Item 1. Financial Statements

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Item 1. Financial Statements

TRACTOR SUPPLY COMPANY

CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share amounts)

(Unaudited)


	For the Fiscal Three				For the Fiscal Six
	Months Ended				Months Ended
	June 27, 2026		June 28, 2025		June 27, 2026		June 28, 2025
Net sales	$	4,541,314	$	4,439,729	$	8,133,360	$	7,906,682
Cost of merchandise sold	2,858,705		2,799,755		5,149,566		5,011,285
Gross profit	1,682,609		1,639,974		2,983,794		2,895,397
Selling, general and administrative expenses	1,021,899		940,063		1,963,052		1,826,269
Depreciation and amortization	130,848		122,099		257,449		242,179
Impairment expense	62,747		—		62,747		—
Operating income	467,115		577,812		700,546		826,949
Interest expense, net	17,103		17,983		36,211		37,624
Income before income taxes	450,012		559,829		664,335		789,325
Income tax expense	89,297		129,786		139,096		179,913
Net income	$	360,715	$	430,043	$	525,239	$	609,412

Net income per share – basic	$	0.69	$	0.81	$	1.00	$	1.15
Net income per share – diluted	$	0.69	$	0.81	$	1.00	$	1.14

Weighted average shares outstanding:
Basic	523,729		530,331		525,068		531,030
Diluted	524,615		532,205		526,416		533,152

Dividends declared per common share outstanding	$	0.24	$	0.23	$	0.48	$	0.46

The accompanying notes are an integral part of these Consolidated Financial Statements.


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TRACTOR SUPPLY COMPANY

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share amounts)

(Unaudited)


	June 27, 2026		December 27, 2025		June 28, 2025
ASSETS
Current assets:
Cash and cash equivalents	$	231,588	$	194,109	$	225,810
Inventories	3,518,451		3,084,086		3,090,306
Prepaid expenses and other current assets	298,482		202,557		227,649
Income taxes receivable	205,995		27,045		—
Total current assets	4,254,516		3,507,797		3,543,765
Property and equipment, net	3,223,898		3,026,544		2,884,660
Operating lease right-of-use assets	4,110,840		3,938,427		3,655,729
Goodwill and other intangible assets	506,249		398,755		399,622

Other assets	66,318		62,156		75,019
Total assets	$	12,161,821	$	10,933,679	$	10,558,795
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	1,760,347	$	1,390,833	$	1,519,094
Accrued employee compensation	74,935		114,841		72,305
Other accrued expenses	878,948		653,482		614,221

Current portion of finance lease liabilities	10,315		5,426		3,437
Current portion of operating lease liabilities	463,556		449,867		410,249
Income taxes payable	1,648		—		143,346

Total current liabilities	3,189,749		2,614,449		2,762,652
Long-term debt	2,153,826		1,764,974		1,673,472
Finance lease liabilities, less current portion	42,933		30,722		26,318
Operating lease liabilities, less current portion	3,874,348		3,691,880		3,443,879
Deferred income taxes	100,109		95,042		19,841
Other long-term liabilities	169,291		155,319		142,324
Total liabilities	9,530,256		8,352,386		8,068,486
Stockholders’ equity:

Common stock	7,136		7,128		7,124
Additional paid-in capital	1,473,959		1,441,269		1,399,333
Treasury stock	(6,641,872)		(6,386,229)		(6,191,887)
Accumulated other comprehensive income	—		—		—
Retained earnings	7,792,342		7,519,125		7,275,739
Total stockholders’ equity	2,631,565		2,581,293		2,490,309
Total liabilities and stockholders’ equity	$	12,161,821	$	10,933,679	$	10,558,795

Preferred Stock (shares in thousands): $1.00 par value; 40 shares authorized; no shares were issued or outstanding during any period presented.

Common Stock (shares in thousands): $0.008 par value; 2,000,000 shares authorized for all periods presented. 892,018, 890,991, and 890,521 shares issued; 521,845, 527,017, and 529,990 shares outstanding at June 27, 2026, December 27, 2025, and June 28, 2025, respectively.

Treasury Stock (at cost, shares in thousands): 370,173, 363,974, and 360,531 shares at June 27, 2026, December 27, 2025, and June 28, 2025, respectively.

The accompanying notes are an integral part of these Consolidated Financial Statements.


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TRACTOR SUPPLY COMPANY

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands)

(Unaudited)


	For the Fiscal Three				For the Fiscal Six
	Months Ended				Months Ended
	June 27, 2026		June 28, 2025		June 27, 2026		June 28, 2025
Net income	$	360,715	$	430,043	$	525,239	$	609,412
Other comprehensive loss:
Change in fair value of interest rate swaps, net of taxes	—		—		—		(1,217)
Total other comprehensive loss	—		—		—		(1,217)
Total comprehensive income	$	360,715	$	430,043	$	525,239	$	608,195

The accompanying notes are an integral part of these Consolidated Financial Statements.


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TRACTOR SUPPLY COMPANY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands)

(Unaudited)


	Common Stock				Additional Paid-in Capital		Treasury Stock		Accum. Other Comp. Income		Retained Earnings		Total Stockholders’ Equity
Shares		Dollars
Stockholders’ equity at December 27, 2025	527,017		$	7,128	$	1,441,269	$	(6,386,229)	$	—	$	7,519,125	$	2,581,293
Common stock issuance under stock award plans & ESPP	820		6		9,589		—		—		—		9,595
Share-based compensation expense	—		—		17,631		—		—		—		17,631
Repurchase of shares to satisfy tax obligations	—		—		(14,102)		—		—		—		(14,102)
Repurchase of common stock	(2,324)		—		—		(118,811)		—		—		(118,811)
Cash dividends paid to stockholders	—		—		—		—		—		(126,381)		(126,381)

Net income	—		—		—		—		—		164,524		164,524
Stockholders’ equity at March 28, 2026	525,513		$	7,134	$	1,454,387	$	(6,505,040)	$	—	$	7,557,268	$	2,513,749

Common stock issuance under stock award plans & ESPP	207		2		4,323		—		—		—		4,325
Share-based compensation expense	—		—		15,531		—		—		—		15,531
Repurchase of shares to satisfy tax obligations	—		—		(282)		—		—		—		(282)
Repurchase of common stock	(3,875)		—		—		(136,832)		—		—		(136,832)
Cash dividends paid to stockholders	—		—		—		—		—		(125,641)		(125,641)

Net income	—		—		—		—		—		360,715		360,715
Stockholders’ equity at June 27, 2026	521,845		$	7,136	$	1,473,959	$	(6,641,872)	$	—	$	7,792,342	$	2,631,565


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	Common Stock				Additional Paid-in Capital		Treasury Stock		Accum. Other Comp. Income		Retained Earnings		Total Stockholders’ Equity
Shares		Dollars
Stockholders' equity at December 28, 2024	532,190		$	7,116	$	1,376,532	$	(6,025,238)	$	1,217	$	6,910,707	$	2,270,334
Common stock issuance under stock award plans & ESPP	777		7		7,009		—		—		—		7,016
Share-based compensation expense	—		—		13,226		—		—		—		13,226
Repurchase of shares to satisfy tax obligations	—		—		(13,960)		—		—		—		(13,960)
Repurchase of common stock	(1,727)		—		—		(93,827)		—		—		(93,827)
Cash dividends paid to stockholders	—		—		—		—		—		(122,401)		(122,401)
Change in fair value of interest rate swaps, net of taxes	—		—		—		—		(1,217)		—		(1,217)
Net income	—		—		—		—		—		179,369		179,369
Stockholders' equity at March 29, 2025	531,240		$	7,123	$	1,382,807	$	(6,119,065)	$	—	$	6,967,675	$	2,238,540

Common stock issuance under stock award plans & ESPP	197		1		4,298		—		—		—		4,299
Share-based compensation expense	—		—		12,750		—		—		—		12,750
Repurchase of shares to satisfy tax obligations	—		—		(522)		—		—		—		(522)
Repurchase of common stock	(1,447)		—		—		(72,822)		—		—		(72,822)
Cash dividends paid to stockholders	—		—		—		—		—		(121,979)		(121,979)
Change in fair value of interest rate swaps, net of taxes	—		—		—		—		—		—		—
Net income	—		—		—		—		—		430,043		430,043
Stockholders’ equity at June 28, 2025	529,990		$	7,124	$	1,399,333	$	(6,191,887)	$	—	$	7,275,739	$	2,490,309

The accompanying notes are an integral part of these Consolidated Financial Statements.


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TRACTOR SUPPLY COMPANY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(Unaudited)


	For the Fiscal Six Months Ended
	June 27, 2026		June 28, 2025
Cash flows from operating activities:
Net income	$	525,239	$	609,412
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	257,449		242,179
Impairment expense	62,747		—
Gain on disposition of property and equipment	(41,465)		(33,421)
Share-based compensation expense	33,162		25,976
Deferred income taxes	(3,010)		(24,054)
Change in assets and liabilities:
Inventories	(429,655)		(231,907)
Prepaid expenses and other current assets	(91,619)		(26,400)
Accounts payable	363,375		271,691
Accrued employee compensation	(39,906)		(28,848)
Other accrued expenses	178,720		(15,892)
Income taxes	(177,303)		160,308
Other	15,402		53,531
Net cash provided by operating activities	653,136		1,002,575
Cash flows from investing activities:
Capital expenditures	(435,713)		(351,644)
Proceeds from sale of property and equipment	69,938		42,906
Acquisition of VIP Petcare, net of cash acquired	(129,838)		—
Acquisition of Allivet, net of cash acquired	—		(139,936)
Net cash used in investing activities	(495,613)		(448,674)
Cash flows from financing activities:
Borrowings under debt facilities	3,000,000		1,315,000
Repayments under debt facilities	(2,610,000)		(1,475,000)
Debt issuance costs	(2,506)		—

Principal payments under finance lease liabilities	(1,445)		(2,056)
Repurchase of shares to satisfy tax obligations	(14,384)		(14,482)
Repurchase of common stock	(253,607)		(169,979)
Net proceeds from issuance of common stock	13,920		11,315
Cash dividends paid to stockholders	(252,022)		(244,380)
Net cash used in financing activities	(120,044)		(579,582)
Net increase (decrease) in cash and cash equivalents	37,479		(25,681)
Cash and cash equivalents at beginning of period	194,109		251,491
Cash and cash equivalents at end of period	$	231,588	$	225,810
Supplemental disclosures of cash flow information:
Cash paid for interest, net of amounts capitalized	$	35,043	$	38,901
Cash paid for federal income taxes (a)	178,711		29,979
Cash paid for state income taxes	2,658		12,839
Supplemental disclosures of non-cash activities:
Non-cash accruals for property and equipment	$	159,604	$	130,807
Increase in operating lease liabilities resulting from new or modified right-of-use assets	402,476		439,149
Increase (decrease) in finance lease liabilities resulting from new or modified right-of-use assets	14,091		(105)

(a) Cash paid for federal income taxes for the fiscal six months ended June 27, 2026 included $166.6 million of cash paid for the purchase of transferable federal tax credits.


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The accompanying notes are an integral part of these Consolidated Financial Statements.


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TRACTOR SUPPLY COMPANY

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Note 1 - General

Nature of Business

Founded in 1938, Tractor Supply Company (the “Company,” “Tractor Supply,” “we,” “our,” or “us”) is the largest rural lifestyle retailer in the United States (“U.S.”). The Company is focused on supplying the needs of recreational farmers, ranchers, and all those who enjoy living the rural lifestyle (which we refer to as the “Out Here” lifestyle). The Company's stores are located primarily in towns outlying major metropolitan markets and in rural communities. The Company also owns and operates the following: Petsense, LLC (“Petsense by Tractor Supply”), a small-box pet specialty supply retailer focused on meeting the needs of pet owners, primarily in small and mid-sized communities, and offering a variety of pet products and services; Allivet, a leading online pet pharmacy; and VIP Petcare, the largest provider of mobile veterinary care in the U.S. At June 27, 2026, the Company operated a total of 2,672 retail stores in 49 states (2,463 Tractor Supply retail stores and 209 Petsense by Tractor Supply retail stores) and also offered an expanded assortment of products through the Tractor Supply mobile application and online at TractorSupply.com, Petsense.com, Allivet.com, and VIPPetcare.com.

Basis of Presentation

The accompanying interim unaudited Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These statements should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended December 27, 2025 (the “2025 Form 10-K”). The results of operations for our interim periods are not necessarily indicative of results for the full fiscal year.

On May 28, 2026, the Company completed its acquisition of VIP Petcare, the veterinary services business of PetIQ. Pursuant to the agreement governing the transaction, the Company acquired 100% of the equity interest in VIP Petcare for a purchase price of $133.8 million.

New Accounting Pronouncements Not Yet Adopted

In May 2026, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2026-02, “Environmental Credits and Environmental Credit Obligations (Topic 818).” The ASU is intended to improve the financial accounting for and disclosure of environmental credits and environmental credit obligations. The ASU is required to be adopted for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. Early adoption is permitted. The amendments should be applied on a retrospective basis through a cumulative-effect adjustment to the opening balance of retained earnings as of the beginning of the annual reporting period of adoption. The Company is currently evaluating the impact of adoption on its financial disclosures.

Supplier Finance Program

The Company has an agreement with a third-party financial institution that allows certain participating suppliers the ability to finance payment obligations from the Company. The third-party financial institution has separate arrangements with the Company’s suppliers and provides them with the option to request early payment for invoices confirmed by the Company. The Company does not determine the terms or conditions of the arrangement between the third-party and its suppliers and receives no compensation from the third-party financial institution. The Company’s obligation to its suppliers, including amounts due and scheduled payment dates, are not impacted by the suppliers’ decisions to finance amounts under the arrangement. A greater number of suppliers began participating in the supplier finance program during the fiscal three and six months ended June 27, 2026 compared to the fiscal three and six months ended June 28, 2025, driving a larger balance in outstanding payment obligations under the program as of June 27, 2026 as compared to December 27, 2025 and June 28, 2025. The Company’s outstanding payment obligations under the supplier finance program, which are included in accounts payable on the Company’s Consolidated Balance Sheets, were $179.0 million, $30.6 million, and $34.2 million at June 27, 2026, December 27, 2025, and June 28, 2025, respectively.


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Note 2 - Fair Value of Financial Instruments

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants on the measurement date. The Company uses a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include:

Level 1 - defined as observable inputs such as quoted prices in active markets;
Level 2 - defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and
Level 3 - defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The Company’s financial instruments consist of cash and cash equivalents, short-term credit card receivables, trade payables, and debt instruments. Due to their short-term nature, the carrying values of cash and cash equivalents, short-term credit card receivables, and trade payables approximate current fair value at each balance sheet date.

As described in further detail in Note 5 to the Consolidated Financial Statements, the Company had $2.17 billion, $1.78 billion and $1.69 billion in borrowings under its debt facilities at June 27, 2026, December 27, 2025 and June 28, 2025, respectively. The fair values of the Company’s $150 million 3.70% Senior Notes due 2029 (the “3.70% Senior Notes”) and the borrowings under the Company’s revolving credit facility (the “Revolving Credit Facility”) were determined based on market interest rates (Level 2 inputs). The carrying value of borrowings in the 3.70% Senior Notes and the Revolving Credit Facility approximate fair value for each period reported.

The fair values of the Company’s $650 million 1.750% Senior Notes due 2030 (the “1.75% Senior Notes”) and $750 million 5.250% Senior Notes due 2033 (the “5.25% Senior Notes”) are determined based on quoted prices in active markets, which are considered Level 1 inputs. The carrying value and the fair value of the 1.75% Senior Notes and the 5.25% Senior Notes, net of discounts, were as follows (in thousands):


	June 27, 2026				December 27, 2025				June 28, 2025
	Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value
1.75% Senior Notes	$	644,037	$	573,599	$	643,349	$	576,765	$	642,660	$	562,426
5.25% Senior Notes	$	743,323	$	756,848	$	742,834	$	778,215	$	742,346	$	763,155

Note 3 - Acquisition of VIP Petcare

Preliminary Allocation of the Purchase Price

The Company has applied the acquisition method of accounting for the VIP Petcare acquisition, in accordance with ASC 805 “Business Combinations,” with respect to the identifiable assets and liabilities of VIP Petcare which have been measured at estimated fair value as of the date of the business combination.

The aggregate purchase price was allocated to the identifiable assets acquired and liabilities assumed based upon their estimated fair values at the acquisition date, primarily using Level 2 and Level 3 inputs. Level 2 and Level 3 inputs are described in further detail in Note 2 to the Consolidated Financial Statements. These fair value estimates represent management’s best estimate of future cash flows (including sales, cost of sales, income taxes, etc.), discount rates, competitive trends, market comparables, and other factors. Inputs used were generally determined from historical data supplemented by current and anticipated market conditions and growth rates.

Although the determination of the preliminary fair values is substantially complete, certain fair value estimates are based on preliminary information and are subject to change during the measurement period, which ends once the Company has determined that it has obtained all necessary information that existed as of the acquisition date or has determined that such information is unavailable and cannot extend beyond one year from the acquisition date. At June 27, 2026, the fair values that


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are based on preliminary information relate primarily to intangible assets, deferred income taxes, and certain working capital adjustments. The amount of consideration transferred that exceeds the fair value of the identifiable assets, net of liabilities, is recorded as goodwill, which is indicative of the expected synergies the acquisition of VIP Petcare will bring to the Company’s portfolio offering for companion animal customers and the additional growth opportunities expected as a result of acquiring VIP Petcare. The goodwill recorded is not deductible for tax purposes.

The purchase consideration and preliminary estimated fair value of VIP Petcare’s net assets acquired are shown below (in thousands):


	Preliminary Allocation of the Purchase Price
Fair value of assets acquired
Cash and cash equivalents	$	524
Inventories	4,710
Prepaid expenses and other current assets	4,627
Property and equipment	11,182
Operating lease right-of-use assets	3,910

Identifiable intangible assets	41,200
Total assets acquired	66,153
Less: liabilities assumed
Accounts payable	6,139
Other accrued expenses	9,371
Current portion of operating lease liabilities	1,982
Deferred income taxes	8,855
Operating lease liabilities, less current portion	2,130
Other long-term liabilities	8,169
Total liabilities assumed	36,646
Goodwill	100,856
Total fair value of consideration transferred	$	130,363

$9.5 million in acquisition costs related to the VIP Petcare acquisition were expensed as incurred and are included in the selling, general, and administrative expenses in the Consolidated Statements of Income.

The results of operations of VIP Petcare have been included in the Consolidated Financial Statements since the date of the acquisition.


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Note 4 – Net Income Per Share

The Company presents both basic and diluted net income per share on the Consolidated Statements of Income. Basic net income per share is calculated by dividing net income by the weighted average number of shares outstanding during the period. Diluted net income per share is calculated by dividing net income by the weighted average diluted shares outstanding during the period. Dilutive shares are computed using the treasury stock method for share-based awards. Performance-based restricted share units are included in diluted shares only if the related performance conditions are considered satisfied as of the end of the reporting period. Net income per share is calculated as follows (in thousands, except per share amounts):


	Fiscal Three Months Ended
	June 27, 2026					June 28, 2025
	Income		Shares	Per Share Amount		Income		Shares	Per Share Amount
Basic net income per share:	$	360,715	523,729	$	0.69	$	430,043	530,331	$	0.81
Dilutive effect of share-based awards	—		886	—		—		1,874	—
Diluted net income per share:	$	360,715	524,615	$	0.69	$	430,043	532,205	$	0.81

	Fiscal Six Months Ended
	June 27, 2026					June 28, 2025
	Income		Shares	Per Share Amount		Income		Shares	Per Share Amount
Basic net income per share:	$	525,239	525,068	$	1.00	$	609,412	531,030	$	1.15
Dilutive effect of share-based awards	—		1,348	—		—		2,122	(0.01)
Diluted net income per share:	$	525,239	526,416	$	1.00	$	609,412	533,152	$	1.14

Anti-dilutive stock awards excluded from the above calculations totaled approximately 4.7 million shares for the fiscal three months ended June 27, 2026 and approximately 1.3 million shares for the fiscal three months ended June 28, 2025. Anti-dilutive stock awards excluded from the above calculations totaled approximately 3.3 million shares for the fiscal six months ended June 27, 2026 and approximately 0.8 million shares for the fiscal six months ended June 28, 2025.


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Note 5 – Debt

The following table summarizes the Company’s outstanding debt as of the dates indicated (in millions):


	June 27, 2026		December 27, 2025		June 28, 2025
5.25% Senior Notes	$	750.0	$	750.0	$	750.0
1.75% Senior Notes	650.0		650.0		650.0
3.70% Senior Notes (a)	150.0		150.0		150.0
Senior credit facilities:
Revolving Credit Facility	620.0		230.0		140.0
Total outstanding borrowings	2,170.0		1,780.0		1,690.0
Less: unamortized debt discounts and issuance costs	(16.2)		(15.0)		(16.5)
Total debt	2,153.8		1,765.0		1,673.5
Less: current portion of long-term debt	—		—		—
Long-term debt	$	2,153.8	$	1,765.0	$	1,673.5

Outstanding letters of credit	$	38.6	$	78.6	$	77.0

(a) Also referred to herein as the “Note Purchase Facility,” referring to the Note Purchase and Private Shelf Agreement dated as of August 14, 2017 by and among the Company, PGIM, Inc. and the noteholders party thereto, as amended through November 2, 2022, under which the notes were purchased.

On May 19, 2026, the Company entered into an Amended and Restated Credit Agreement, by and among the Company, as Borrower, certain lenders, and Wells Fargo Bank, National Association, as administrative agent (the “Amended Credit Agreement”). The credit facility provided pursuant to the Amended Credit Agreement (the “2026 Senior Credit Facility”) amends and restates the Company’s existing credit agreement. Outstanding borrowings under the existing senior credit facility were refinanced under the Amended Credit Agreement.

Borrowings under the 2026 Senior Credit Facility bore interest either at the bank’s base rate (6.750% at June 27, 2026) plus an additional amount ranging from 0.000% to 0.250% (0.000% at June 27, 2026) or at adjusted Secured Overnight Financing Rate (3.644% at June 27, 2026) plus an additional amount ranging from 0.750% to 1.250% (1.000% at June 27, 2026), adjusted based on the Company’s public credit ratings. The Company was also required to pay, quarterly in arrears, a commitment fee related to unused capacity on the Revolving Credit Facility ranging from 0.075% to 0.150% per annum (0.090% at June 27, 2026), adjusted based on the Company’s public credit ratings.

Covenants and Default Provisions of the Debt Agreements

As of June 27, 2026, the 2026 Senior Credit Facility and the Note Purchase Facility (collectively, the “Debt Agreements”) required quarterly compliance with respect to one material covenant: a leverage ratio. This ratio is calculated on a trailing twelve-month basis at the end of each fiscal quarter. The leverage ratio compares total funded debt to earnings before interest, taxes, depreciation, amortization, share based compensation and rent expense. The leverage ratio was required to be less than or equal to 4.00 to 1.00 as of the last day of each fiscal quarter. The Debt Agreements also contain certain other restrictions regarding additional subsidiary indebtedness, business operations, subsidiary guarantees, mergers, consolidations and sales of assets, transactions with subsidiaries or affiliates, and liens. As of June 27, 2026, the Company was in compliance with the debt covenant.

The Debt Agreements contain customary events of default, including payment defaults, breaches of representations and warranties, covenant defaults, cross-defaults to other material indebtedness, certain events of bankruptcy and insolvency, material judgments, certain ERISA events, and invalidity of loan documents. Upon certain changes of control, amounts outstanding under the Debt Agreements could become due and payable. In addition, under the Note Purchase Facility, upon an event of default or change of control, the make whole payment as described in the Company’s 2025 Form 10-K may become due and payable.

The Note Purchase Facility also requires that, in the event the Company amends its 2026 Senior Credit Facility, or any subsequent credit facility of $100 million or greater, such that it contains covenant or default provisions that are not provided in the Note Purchase Facility or that are similar to those contained in the Note Purchase Facility but which contain percentages, amounts, formulas, or grace periods that are more restrictive than those set forth in the Note Purchase Facility or are otherwise


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more beneficial to the lenders thereunder, the Note Purchase Facility shall be automatically amended to include such additional or amended covenants and/or default provisions.

Note 6 – Capital Stock and Dividends

Capital Stock

The authorized capital stock of the Company consists of common stock and preferred stock. The Company is authorized to issue 2.00 billion shares of common stock. The Company is also authorized to issue 40 thousand shares of preferred stock, with such designations, rights and preferences as may be determined from time to time by the Company's Board of Directors.

Dividends

During the first six months of fiscal 2026 and fiscal 2025, the Company's Board of Directors declared the following cash dividends:


Date Declared	Dividend Amount Per Share of Common Stock		Record Date	Date Paid

May 13, 2026	$	0.24	May 27, 2026	June 9, 2026
February 10, 2026	$	0.24	February 24, 2026	March 10, 2026


May 14, 2025	$	0.23	May 28, 2025	June 10, 2025
February 12, 2025	$	0.23	February 26, 2025	March 11, 2025

On August 5, 2026, the Company’s Board of Directors declared a quarterly cash dividend of $0.24 per share of the Company’s outstanding common stock. The dividend will be paid on September 8, 2026 to stockholders of record as of the close of business on August 24, 2026.

Note 7 – Treasury Stock

The Company’s Board of Directors has authorized common stock repurchases under a share repurchase program, which was most recently increased by $1.00 billion on February 12, 2025. The total amount authorized under the program, which has been increased from time to time, is currently $7.50 billion, exclusive of any fees, commissions, or other expenses related to such repurchases. The share repurchase program does not have an expiration date. The repurchases may be made from time to time on the open market or in privately negotiated transactions. The timing and amount of any shares repurchased under the program will depend on a variety of factors, including price, corporate and regulatory requirements, capital availability, and other market conditions. Repurchased shares are accounted for at cost and will be held in treasury for future issuance. The program may be limited, temporarily paused, or terminated at any time without prior notice. As of June 27, 2026, the Company had remaining authorization under the share repurchase program of $873.4 million, exclusive of any fees, commissions, or other expenses.

The following table provides the number of shares repurchased, average price paid per share, and total cost of share repurchases during the fiscal three and six months ended June 27, 2026 and June 28, 2025, respectively (in thousands, except per share amounts):


	Fiscal Three Months Ended				Fiscal Six Months Ended
	June 27, 2026		June 28, 2025		June 27, 2026		June 28, 2025
Total number of shares repurchased	3,875		1,447		6,199		3,174
Average price paid per share	$	34.92	$	51.10	$	40.86	$	52.89
Total cost of share repurchases (a)	$	136,832	$	72,822	$	255,643	$	166,649

(a) Effective January 1, 2023, the Company’s share repurchases are subject to a 1% excise tax as a result of the Inflation Reduction Act of 2022. Excise taxes incurred on share repurchases represent direct costs of the repurchase and are recorded as a part of the cost basis of the shares within treasury stock. The cost of shares repurchased may differ from the repurchases of common stock amounts in the consolidated statements of cash flows due to unsettled share repurchases at the end of a period and excise taxes incurred on share repurchases.


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Note 8 – Income Taxes

The Company’s effective income tax rate was 19.8% in the second quarter of fiscal 2026 compared to 23.2% in the second quarter of fiscal 2025. The decrease was primarily driven by the income tax benefit associated with the purchase of transferable federal income tax credits, as well as the one-time charges associated with the restructuring of the Petsense business and the acquisition costs associated with VIP Petcare.

The Company’s effective income tax rate was 20.9% in the first six months of fiscal 2026 compared to 22.8% in the first six months of fiscal 2025. The decrease was primarily driven by the income tax benefit associated with the purchase of transferable federal income tax credits, partially offset by permanent differences and other discrete tax items.

Note 9 – Commitments and Contingencies

Letters of Credit

At June 27, 2026, the Company had $38.6 million in outstanding letters of credit and contractual commitments of approximately $34.8 million related to the construction of our newest distribution center in Nampa, Idaho.

Litigation

The Company is involved in various litigation matters arising in the ordinary course of business. The Company believes that, based upon information currently available, any estimated loss related to such matters has been adequately provided for in accrued liabilities to the extent probable and reasonably estimable. Accordingly, the Company currently expects these matters will be resolved without a material adverse effect on its consolidated financial position, results of operations, or cash flows. However, litigation and other legal matters involve an element of uncertainty. Future developments in such matters, including adverse decisions or settlements or resulting required changes to the Company's business operations, could affect our consolidated operating results when resolved in future periods or could result in liability or other amounts material to the Company's Consolidated Financial Statements.

Note 10 – Segment Reporting

The Company has one reportable segment which is the retail sale of products that support the rural lifestyle. The following table indicates the percentage of net sales represented by each of our major product categories during the fiscal three and six months ended June 27, 2026 and June 28, 2025:


		Fiscal Three Months Ended				Fiscal Six Months Ended
Product Category		June 27, 2026		June 28, 2025		June 27, 2026		June 28, 2025
Livestock, Equine & Agriculture (a)		32	%	31	%	31	%	31	%
Seasonal & Recreation (b)		26		26		23		23
Companion Animal (c)		21		21		23		23
Truck, Tool & Hardware (d)		14		15		15		15
Clothing, Gift & Décor (e)		7		7		8		8
Total		100	%	100	%	100	%	100	%

Note: Net sales by major product categories for the prior period have been reclassified to conform to the current year presentation.

(a)	Includes livestock and equine feed & equipment, poultry, fencing, and sprayer & chemicals.
(b)	Includes tractor & rider, lawn & garden, bird feeding, power equipment, and other recreational products.
(c)	Includes food, treats and equipment for dogs, cats, and other small animals as well as dog wellness.
(d)	Includes truck accessories, trailers, generators, lubricants, batteries, and hardware and tools.
(e)	Includes clothing, footwear, toys, snacks, and decorative merchandise.

The measure of segment assets is reported on the Company’s Consolidated Balance Sheets as total consolidated assets.


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Within the reportable segment, there are significant expense categories regularly provided to the Chief Operating Decision Maker and included in the measure of the segment’s net income as shown below:


	Fiscal Three Months Ended				Fiscal Six Months Ended
	June 27, 2026		June 28, 2025		June 27, 2026		June 28, 2025
Net Sales	$	4,541,314	$	4,439,729	$	8,133,360	$	7,906,682
Less:
Cost of merchandise sold	2,858,705		2,799,755		5,149,566		5,011,285
Personnel expense (a)	558,003		525,315		1,082,929		1,014,602
Depreciation and amortization	130,848		122,099		257,449		242,179
Impairment expense	62,747		—		62,747		—
Other segment expenses (b)	463,896		414,748		880,123		811,667
Interest expense, net	17,103		17,983		36,211		37,624
Income tax expense	89,297		129,786		139,096		179,913
Segment net income	$	360,715	$	430,043	$	525,239	$	609,412

Reconciliation of segment profit:
Adjustments and reconciling items	—		—		—		—
Consolidated net income	$	360,715	$	430,043	$	525,239	$	609,412

(a) Personnel expenses include wages, salaries, and other forms of personnel compensation.

(b) Other segment expenses include occupancy expenses, advertising expenses, and other operating expenses within Selling, General, and Administrative expenses as described in Note 1 of the Company’s 2025 Form 10-K.

Note 11 - Impairment and Restructuring

During the second quarter of fiscal 2026, the Company completed a strategic reassessment of the Petsense business including an evaluation of the current operations and future growth outlook for that business. As a result of this review, management approved a plan to restructure the business, including the closure of approximately 75 stores. These planned store closures and the corresponding decrease in expected future cash flow due to the closures resulted in a downward adjustment of the future financial forecast for the Petsense business. This also signaled that potential impairment indicators existed for both the goodwill asset and tradename intangible asset that are related to the Petsense reporting unit. The Company performed assessments of the fair value of inventories and tangible long-lived assets and concluded that impairment charges were necessary. Finally, the Company evaluated other restructuring charges as a result of these planned closures.

As a result of these assessments, the Company recognized pre-tax charges totaling $71.7 million during the three and six months ended June 27, 2026. These charges are as follows (in thousands):


	Fiscal Three and Six Months Ended
	June 27, 2026		June 28, 2025
Goodwill and intangible asset impairment	$	33,161	$	—
Other long-lived asset impairment and restructuring charges	32,586		—
Inventory impairment	5,926		—
Total impairment and restructuring charges	$	71,673	$	—

Goodwill

Goodwill is allocated to each identified reporting unit, which is defined as an operating segment or one level below the operating segment. Goodwill is not amortized, but is evaluated for impairment annually and whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable. The aforementioned planned closure of approximately 75 Petsense stores and the corresponding decrease in expected cash flow due to the closures resulted in a downward adjustment of the future financial forecast for the Petsense business. This indicated that it was more likely than not


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that the carrying value of the Petsense reporting unit exceeded its fair value. As a result, the Company performed an interim impairment assessment as of the date of the approved closure plan.

The Company conducted a quantitative impairment analysis of the Petsense reporting unit using the income approach. The determination of fair value under the income approach requires management to make subjective judgments involving, among other items, forecasts of projected financial information (such as revenue growth rates, profit margins, tax rates, and capital expenditures) and selection of a discount rate that reflects the risk inherent in estimated future cash flows. These are unobservable inputs classified as Level 3 inputs under the fair value hierarchy.

As a result of the quantitative impairment analysis of the Petsense reporting unit, it was determined that the carrying value exceeded the fair value, resulting in a pre-tax impairment loss of approximately $22.2 million in the fiscal six months ended June 27, 2026.

The changes in the carrying amount of goodwill by reporting unit for the fiscal three and six months ended June 27, 2026 and June 28, 2025 are as follows (in thousands):


	Fiscal Three and Six Months Ended						Fiscal Three and Six Months Ended
	June 27, 2026						June 28, 2025
	Tractor Supply		Petsense		Consolidated		Tractor Supply		Petsense		Consolidated
Net goodwill, beginning of year	$	324,563	$	22,161	$	346,724	$	224,258	$	22,161	$	246,419
Impairment expense	—		(22,161)		(22,161)		—		—		—
Acquisition of Allivet	—		—		—		100,882		—		100,882
Acquisition of VIP Petcare	100,856		—		100,856		—		—		—
Net goodwill, end of period	$	425,419	$	—	$	425,419	$	325,140	$	22,161	$	347,301

Other Intangible Assets

The Company had approximately $80.8 million and $52.3 million of intangible assets other than goodwill at June 27, 2026 and June 28, 2025, respectively. These identifiable intangible assets included the Petsense tradename intangible asset, which had a carrying value of $23.1 million at June 28, 2025. The intangible asset balance represents the carrying value of certain indefinite-lived assets, which are not subject to amortization as they have an indefinite useful life on the basis that they are expected to contribute cash flows beyond the foreseeable horizon, and certain definite-lived assets. These assets are evaluated for impairment annually and whenever events or changes in circumstances indicate the carrying value of the asset may not be recoverable.

The aforementioned planned closure of approximately 75 Petsense stores and the corresponding decrease in expected future cash flow due to the closures resulted in a downward adjustment of the future financial forecast for the Petsense business. This indicated that it was more likely than not that the carrying value of the Petsense tradename asset exceeded its fair value. We conducted a quantitative impairment analysis in the second quarter of fiscal 2026 using the relief-from-royalty method to measure the estimated fair value of the tradename intangible asset at the measurement date. The determination of fair value requires management to make subjective judgments involving forecasts of projected revenue growth rates, royalty rates, and tax rates, as well as the selection of a discount rate that reflects the risk inherent in estimated future cash flows. These are unobservable inputs classified as Level 3 inputs under the fair value hierarchy. If actual results are not consistent with our estimates and assumptions used in estimating future cash flows and asset fair values, we may be exposed to additional impairment losses in a future period. As a result of the quantitative impairment analysis, it was determined that the carrying value of the Petsense tradename was in excess of the fair value, resulting in a pre-tax impairment loss of approximately $11.0 million, included in the impairment expense income statement caption, in the fiscal three and six months ended June 27, 2026.


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