Company: SPWH
Filing Date: 2025-04-02
Form Type: 10-K
Source: 0000950170-25-048890
Chunk: 230

Company: SPORTSMAN'S WAREHOUSE HOLDINGS, INC.
Filing Date: 2025-04-02
Form: 10-K
Item: Item 1B
Chunk 230
---
 tensions;

•consumer preferences, buying trends and overall economic trends; 

•changes or anticipated changes to laws and government regulations related to some of the products we sell, in particular regulations relating to the sale of firearms and ammunition; 

•our ability to identify and respond effectively to local and regional trends and customer preferences; 

•our ability to provide quality customer service that will increase our conversion of shoppers into paying customers; 

•the success of our omni-channel strategy and our e-commerce platform;

•competition in the regional market of a store; 

•atypical weather; 

•new product introductions and changes in our product mix; and 

•changes in pricing and average ticket sales. 

We operate in a complex regulatory and legal environment that could negatively impact the demand for our products, which could significantly affect our operations and financial results. State, local, and federal laws and regulations relating to products that we sell may change, sometimes significantly, as a result of political, economic or social events. For instance, in November 2022, Oregon passed a ballot measure that bans firearms and magazines with a capacity of over ten rounds, and that, among other things, imposes complex permitting and training requirements for the purchases of firearms.  On December 6, 2022, a state circuit court judge in Oregon temporarily blocked the enforcement of such legislation and later granted a permanent injunction on November 21, 2023. The measure was also being challenged in a related case in federal court and was on appeal to the Ninth Circuit Court of Appeals. However, due to the recent ruling of a similar capacity restriction case in California (Duncan vs. Bonta), the Oregon federal court case will likely be remanded to the lower court. 

Recently, on March 12, 2025, the Oregon Court of Appeals ruled that the ballot measure is constitutional under Oregon's state constitution and gave the plaintiffs 35 days to appeal the decision.  As a result, sales of firearms in Oregon may be halted or substantially diminished until all permitting and training programs are fully developed by 

44

the state and/or law enforcement agencies. If that were to occur, it could result in a substantial decline in our sales of firearms and related products and reduce traffic to our stores in Oregon, which could have a substantial impact on our sales and gross margin. 

A pending bill in the Oregon House (HB 3075) seeks to delay the implementation of the permitting requirement until July 2026 and provides for certain exemptions (notably for law enforcement and military members