Smith & Wesson Brands Earnings Call Transcripts
Fiscal Year 2026
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Net sales grew 17% year-over-year to $135.7 million, driven by strong handgun demand and new products, with EBITDA up 21% and significant market share gains. Q4 sales are expected to rise 10%–12%, with higher margins and continued cash generation.
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Q2 saw $124.7M in sales and $15M EBITDA, with strong cash flow from inventory reduction and new products driving nearly 40% of sales. Q3 sales are expected to rise 8–10% year-over-year, with gross margins and ASPs increasing, and Q4 projected to be the strongest quarter.
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Q1 sales reached $85.1 million with strong new product demand, though net sales and gross margin declined year-over-year. Inventory levels are healthy, and Q2 sales are expected to rise sequentially but remain below last year. The Smith & Wesson Academy reopened, and a $0.13 dividend was authorized.
Fiscal Year 2025
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Q4 sales and margins declined year-over-year due to macroeconomic headwinds, but new products drove market share gains in handguns. Fiscal 2026 is expected to mirror 2025, with continued cost pressures from tariffs and inflation, and a focus on inventory and debt reduction.
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Q3 sales declined 15.7% year-over-year, but new products drove over 41% of sales and supported market share gains in handguns. Margins and revenue are expected to remain under pressure due to soft demand and inventory reduction, with full-year revenue likely down 10%.
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Q2 sales rose 3.8% year-over-year, driven by new products, but demand softened late in the quarter due to inflation and increased promotional activity. Full-year revenue is expected to decline 5%-10%, with margins under pressure and continued focus on innovation and disciplined capital allocation.
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Q1 sales fell 22.7% year-over-year amid softer demand and inflation, but gross margin improved and new products drove 41% of sales. Inventory rose in anticipation of a strong fall, and a new $50M buyback was authorized. Full-year revenue and margin growth are expected.
Fiscal Year 2024
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The meeting covered board elections, approval of executive compensation, and rejection of a shareholder proposal for a human rights impact assessment. Fiscal 2024 saw strong revenue growth, new product launches, and a major facility relocation.
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Q4 and full-year revenue and shipments grew double digits, outpacing a declining market, with strong new product launches and robust cash generation. Fiscal 2025 is expected to see mid- to high-single-digit growth, with a stronger second half driven by new products and election tailwinds.