Operator

Good day, everyone, and welcome to Cricut Fourth Quarter 2025 Earnings Conference Call. [Operator Instructions] Please note, this conference is being recorded.

Now, it’s my pleasure to turn the call over to the Senior Vice President and Head of Investor Relations, Jim Suva. Please proceed.

Jim Suva
Senior Vice President of Finance, Treasurer & Investor Relations

Thank you, operator, and good afternoon, everyone. Thank you for joining us on Cricut’s Fourth Quarter 2025 Earnings Call.

Please note that today’s call is being webcast and recorded on the Investor Relations section of the company’s website. A replay of the webcast will also be available following today’s call. For your reference, accompanying slides used on today’s call, along with a supplemental data sheet, have been posted to the Investor Relations section of the company’s website, investor.cricut.com.

Joining me on the call today are Ashish Arora, Chief Executive Officer; and Kimball Shill, Chief Financial Officer. Today’s prepared remarks have been recorded, after which Ashish and Kimball will host live Q&A.

Before we begin, we would like to remind everyone that our prepared remarks contain forward-looking statements, and management may make additional forward-looking statements, including statements regarding our strategies, business, expenses, tariffs, capital allocation and results of operations in response to your questions. These statements do not guarantee future performance, and therefore, undue reliance should not be placed upon them.

These statements are based on current expectations

Two employees at a Smoothie King franchise in Ann Arbor were terminated Monday after a viral video captured them refusing to serve a couple because the husband was wearing a hoodie bearing President Donald Trump’s name, prompting a swift corporate investigation and public backlash over alleged political discrimination.

The incident unfolded Sunday afternoon at the Smoothie King location on Jackson Road, a bustling strip in this liberal-leaning college town home to the University of Michigan. Erika Lindemyer and her husband, Jake, entered the store seeking smoothies when two young female workers behind the counter expressed discomfort with Jake’s attire and declined to take their order.

In the 90-second video filmed by Erika and posted to TikTok, the confrontation escalates as the couple accuses the employees of discrimination. “We were just wanting a smoothie, and you literally looked at us and I asked you if everything was OK and you said, ‘We don’t feel comfortable serving you’ because of my husband’s hoodie,” Erika says in the footage. “That is discrimination.”

One employee responds calmly, “Okay, well, have a great day,” while the other adds, “I said Trump discriminates [against] us.” As the argument intensifies, the second worker insists, “We have a right to refuse service,” and directs the couple to the door. Erika retorts that the refusal is “illegal” and threatens to call police before exiting, lamenting, “What’s embarrassing is that we’re American citizens and I wanted to get a smoothie.”

The video quickly spread across social media platforms, amassing hundreds of thousands of views on X (formerly Twitter) and TikTok by Monday morning. Accounts like Libs of TikTok and Leftism amplified the clip, with Leftism identifying one employee as Janiyah Mishelle Williams of Ann Arbor. “She refused to serve customers at @SmoothieKing because the husband wore a Trump hoodie,” Leftism posted, garnering widespread attention.

Smoothie King, a New Orleans-based chain with over 1,300 locations specializing in blended fruit drinks, responded swiftly. In a statement posted to X on Monday evening, the company affirmed its “zero tolerance for discrimination of any kind, including political affiliation.” It confirmed that following an investigation, the franchise owner had taken “immediate action,” and the two employees “are no longer with the business.”

“We were deeply concerned to learn of an incident involving a guest who was refused service at a franchised location in Michigan yesterday,” the statement read. “Every guest and team member deserves to feel welcomed. We remain firmly committed to upholding our brand standards and ensuring our stores are inclusive environments where everyone feels cared for and respected.” The franchise owner also apologized directly to the Lindemyers and mandated retraining for all staff on guest experience protocols.

Williams, who claims to be a minor, posted her own videos on TikTok in response, captioning one “refusing service to Trumpies gone wrong” and another “I lowkey might be cooked.. why does my job support Trump?” She doubled down in subsequent clips, framing the standoff as “good vs. evil” and urging viewers to report Erika’s video for removal, citing lack of consent and racist comments from predominantly white users.

By Monday morning, Williams launched a GoFundMe campaign seeking $700 for “support for safety after online harassment,” boasting about her refusal to serve Trump supporters and detailing threats that made returning to work unsafe. The fundraiser raised nearly $400 before being disabled later that day, following calls from critics like Leftism for the platform to intervene. In a later X post, Williams claimed Trump had legalized the right to refuse service — a misstatement, as federal law does not explicitly protect political affiliation, though local ordinances in Ann Arbor prohibit discrimination based on political beliefs in public accommodations.

Public reaction was polarized, reflecting broader national divides. Conservative commentators hailed the firings as a victory against “woke” bias, with X users like Ryan Ermanni of FOX 2 Detroit noting, “Smoothie King has FIRED two employees in Michigan.” Calls for boycotts emerged briefly before the terminations, with one X post warning, “Boycott Smoothie King” if action wasn’t taken. Others, like podcaster Jeremy from The Quartering, mocked the employees’ decision, saying it “ruined her life” over an entry-level job.

On the other side, some defended the workers’ right to feel safe, with Reddit threads in r/AnnArbor debating whether the hoodie constituted a threat in a progressive enclave. “If they felt unsafe, they shouldn’t be forced to serve someone,” one commenter wrote on Times of India. Instagram reactions included calls for lawsuits, with users tagging Smoothie King and decrying discrimination.

The episode echoes past controversies, such as 2018 incidents where Trump supporters were denied service over MAGA hats at restaurants in New York and Virginia, sparking debates on free speech versus private business rights. Legal experts note that while the Civil Rights Act protects against discrimination based on race, religion and other traits, political views fall into a gray area, often governed by state or local laws. In Michigan, Ann Arbor’s human rights ordinance explicitly bans bias in public services based on “political beliefs,” potentially exposing the franchise to complaints.

Smoothie King, founded in 1973 and now franchised globally, has emphasized inclusivity in its response, aiming to avoid the fate of brands like Bud Light, which faced boycotts over political missteps. Franchise owners operate independently but adhere to corporate standards, and this incident highlights challenges in enforcing uniform policies amid polarized times.

As of Tuesday, no police report was filed, per local sources, and the Lindemyers have not indicated plans for legal action. Williams continued posting online, unrepentant, while job hunt speculation swirled in conservative circles. The viral storm underscores how everyday encounters can ignite national debates in an election year, with Ann Arbor’s progressive vibe — where Trump garnered just 20% of the vote in 2024 — amplifying the clash.

Experts like University of Michigan political science professor Jenna Bednar told local media that such incidents reflect deepening societal rifts. “In a diverse community like ours, service refusals based on politics erode trust,” she said. Meanwhile, Smoothie King’s stock (part of parent company) dipped slightly amid the chatter, though analysts attribute it to broader market trends.

The franchise has reopened normally, with retraining underway. For the Lindemyers, what started as a quick stop ended in vindication — and a free smoothie voucher from corporate.

For many years, internal material handling was considered a secondary function, necessary to feed lines, clear areas and move materials between departments.

This is changing. Rising operational complexity and higher volumes are transforming internal flows into a lever for continuity, labor sustainability and reduced congestion within plants. SKU proliferation, omnichannel strategies, flexible production schedules and multi-shift operations are increasing pressure on material movements. Disruptions in these flows can slow production, increase Work-in-Progress (WIP) and create bottlenecks in critical areas. Internal logistics, once invisible, is now treated as part of the industrial system.

A more complex operating environment

Manufacturing is no longer based solely on homogeneous batches and linear sequences. Lines are supplied more frequently and with product variants. The result is a higher density of movements on wheels (carts, containers and dedicated carriers) that must reach the line regularly to sustain continuity. At the same time, several sectors are reducing the use of heavy vehicles near production. In automotive, pharma, food and packaging, forklifts are being replaced with lighter and more ergonomic solutions. Drivers include safety, congestion, space constraints and costs related to licensing, insurance and maintenance.

The workforce variable

Labor availability is another structural element. Repetitive manual handling requires physical force, increases injury risk and is difficult to sustain over three shifts. Improving ergonomics is no longer a collateral benefit but a way to protect uptime, reduce turnover and retain qualified personnel.

Not only automation: the gradual transition

The debate around automation in internal logistics is often framed as a choice between manual handling and fully autonomous systems such as AGVs, AMRs or industrial robots. Adoption, however, tends to be more incremental. Many plants are not yet prepared for full automation due to investment levels, layout implications, integration requirements and the rigidity associated with fixed automated flows. This is creating space for an intermediate category: operator-assist electric solutions that remove physical effort, support flow continuity and retain operator flexibility. These systems require no infrastructure, no software integration and no plant modifications, and typically deliver a faster ROI than full automation.

Across sectors, three priorities are shaping decisions on internal handling upgrades:

1. Labor sustainability → reducing strain, injuries and turnover
2. Operational continuity → regular line feeding, including multi-shift
3. Flexibility → avoiding rigid systems that limit layouts and product mix

There is also growing interest in reducing heavy vehicles in high-density human areas for safety and space configuration reasons.

Renova’s proposal in the operator-assist segment

In this context, operator-assist technologies represent a strategic intermediate layer between manual processes and autonomous systems. Renova has developed a dedicated material handling range, including cart movers and electric tow tugs, designed to prioritize ergonomics, ensure continuity across multiple shifts, and provide high operational flexibility.

A range designed for operational versatility

Renova’s new material handling line covers a wide range of applications, from line-side movements in tight spaces to heavy-duty movements in aerospace, marine and waste-handling environments. With capacity to move wheeled loads up to 6 tons, these systems can be deployed in sectors that have significantly increased the density of internal movements over recent years. Globally, industries such as pharma, food & beverage, aerospace and industrial logistics are growing at annual rates of 5–7%, driven by higher volumes, SKU expansion and multi-shift production. In Europe, this trend is reinforced by the progressive reduction of forklifts near production and the rise of operator-assist solutions as a stable intermediate category.

The range includes Cart Movers and Electric Tow Tugs.The MCE 400/500 cart mover models handle up to 5-ton carts, while the MTE electric tow tug series covers 1.5 to 6-ton applications. Compact models such as MTE 1000/1500 are suited for line-side, end-of-line and machine feeding; MTE 100W is optimized for two-wheel carts often used in the textile industry; and MTE 3500, MTE 6000 and MTE 6000S address heavier towing tasks typical of waste handling, airport and marine sectors.

Integrated with ergonomic handles, the heavy-duty design enables precise maneuverability both indoors and outdoors, including irregular surfaces, tight layouts and non-linear paths. The systems easily overcome obstacles while maintaining full control and operational safety, with compliance to ISO 11228. The Plug&Play lithium battery system supports multi-shift operations without charging downtime, and no operator license is required, reducing training costs and expanding workforce eligibility. Both the device and the battery system come with a two-year warranty, ensuring operational continuity and lower lifecycle costs. For sectors with specific requirements, including chemical and pharmaceutical, ATEX configurations are available.

Balancing efficiency, continuity and flexibility

Ultimately, the shift in internal handling is being driven as much by economics as by ergonomics. Plants are seeking continuity with fewer forklift interventions, shorter integration cycles and a lower total cost of ownership, all while facing tighter layouts and more demanding labor models. Operator-assist systems respond to these constraints by offering a scalable upgrade path that does not require infrastructure, software integration or specialized licensing.

If warehouse and fulfilment operations have already been heavily automated, the open question for the coming decade is how far internal flows can evolve without compromising flexibility. Renova’s new Material Handling range moves precisely in this direction, enabling a more balanced distribution of tasks between operators, equipment and automated systems, and opening the discussion on what the next stage of internal handling might look like inside modern plants.

Sources:

• 2025 Warehouse Automation & Order Fulfillment Study – Peerless Research Group
• 2025 Warehouse Automation Industry Outlook- Modern Materials Handling
• Warehouse Automation Market Report 2025–2029-ResearchAndMarkets.com
• OSHA 2023 Work-Related Injury & Illness Summary (PDF)
• OSHA Warehousing Hazards & Safety Guidance

Drone strikes damaged Amazon Web Services data centers in the Middle East, disrupting cloud operations and prompting the company to urge customers to move critical workloads out of the region.

AWS confirmed that two of its data center facilities in the United Arab Emirates were directly struck, while a separate strike near a site in Bahrain also caused infrastructure damage. The attacks disrupted power systems and caused structural damage, impairing two of the three data center sites that make up AWS’s UAE cloud region.

As a result, businesses that rely on AWS to run their websites, store data and process transactions experienced more error rates, slower performance and service interruptions. 

AWS confirmed that two of its data center facilities in the United Arab Emirates were directly struck and another site in Bahrain also sustained damage. (Hamad I Mohammed/Reuters)

AWS said full recovery will depend in part on repairing physical damage and restoring power and connectivity – a process that could take at least a day and potentially longer.

OIL PRICES SURGE AFTER STRIKES KILL IRAN’S SUPREME LEADER, TANKERS HIT NEAR STRAIT OF HORMUZ

The company has urged its customers in the Middle East to activate disaster recovery plans, restore data from backups in other regions and redirect traffic away from the affected facilities. Customers were advised to consider shifting operations to AWS regions in the United States, Europe or Asia-Pacific.

The damage comes amid unrest after Operation Epic Fury. (Fatemeh Bahrami/Anadolu via Getty Images)

While cloud providers are designed to withstand the loss of a single data center, simultaneous damage to multiple facilities has strained built-in backup systems.

AWS initially described the situation as a localized power issue before later confirming that drone strikes had caused physical damage. The company said it is working with local authorities and prioritizing employee safety as repairs continue.

The company did not say who was responsible for the strikes, but it came amid the ongoing conflict with Iran that has spilled over into the wider region, throwing businesses and economies into uncertainty. 

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When reached for additional details, Amazon referred FOX Business to its AWS Health Dashboard.