What Calavo Growers, Inc. told the SEC could break it.

Calavo derives a substantial portion of revenue from a relatively small number of customers: its largest (undisclosed) customer represented approximately 14%, 12% and 12% of net sales in fiscal 2025, 2024 and 2023, and its top ten customers accounted for approximately 51%, 50% and 60% of consolidated net sales in those years; the loss of, or a significant reduction in purchases by, any of these large retail/foodservice customers could materially adversely affect its business, financial condition and results.

“our top ten customers accounting for approximately 51%, 50%, and 60% of consolidated net sales in fiscal years 2025, 2024, and 2023, including our largest customer representing approximately 14%, 12%, and 12% of net sales in those years.”

Calavo's supply chain and workforce are concentrated in Mexico: of 1,969 employees as of October 31, 2025, 1,676 were in Mexico (substantially all of whom are union-represented), it procures and packs avocados in Mexico (including through its ~83%-owned Avocados de Jalisco packinghouse in Jalisco), and it maintains owned facilities there; Mexican labor actions, currency/IVA-refund and tax disputes with the SAT, phytosanitary/border issues or political-economic instability could disrupt supply and raise costs.

“As of October 31, 2025, we had 1,969 employees, of which 293 were in the U.S. and 1,676 were in Mexico.”

Calavo faces significant cross-border food-safety and trade regulation: in fiscal 2025 it incurred $5.1 million of discrete costs from an FDA detention hold on certain Mexican avocado imports (a fungicide found on grower fruit) amid heightened FDA border testing/inspection, its Mexican operations are subject to USDA APHIS and Mexican SADER phytosanitary certification for Hass avocado importation, and the Tomato Suspension Agreement's anti-dumping duties on most fresh Mexican tomatoes (plus tariffs) can reduce import demand and create pricing/volume volatility — any of which can raise costs and disrupt supply.

“Avocado gross profit decreased by $9.1 million, or 18%, reflecting lower carton volumes and the impact of $5.1 million in discrete costs associated with the FDA detention hold on certain avocado imports from Mexico in July and August 2025, where the fungicide was present on fruit purchased from a grower and is never applied in Calavo facilities.”

Calavo's Fresh and Prepared businesses depend on agricultural commodities — primarily avocados and tomatoes — whose volume and quality are subject to seasonal trends and whose prices are volatile (avocado average sale price per carton swung sharply year to year, and abundant U.S. tomato supply pressured fiscal-2025 pricing/volumes); commodity and consumer-price inflation increases its product and SG&A costs, which it may be unable to fully offset through price increases if consumers lack the buying power, compressing margins.

“The principal effect of inflation in both commodity and consumer prices on our operating results is to increase costs, both for products sold and selling, general and administrative expenses.”

Calavo's guacamole production capacity is consolidated in a single manufacturing plant in the state of Michoacán, Mexico, so any significant production disruption at that site — natural disaster, labor action, regulatory/phytosanitary intervention, security incident or equipment failure — could limit the availability of some or all of its guacamole products and adversely affect its Prepared segment results.

“our production capacity for guacamole products is consolidated in a single manufacturing plant in the state of Michoacán, Mexico. Any significant production disruptions at this manufacturing site could result in a limitation of the availability of some or all our guacamole products.”