American Outdoor Brands, Inc.’s earnings on an adjusted basis were down 24.5 percent in the fiscal second quarter ended October 31 as sales declined 5 percent and gross margins eroded.  The parent of a wide range of hunting and outdoor brands said in-store sell-through for its products remains strong, but orders continue to be impacted by “cautious retailer buying.”

Second Quarter Fiscal 2026 Financial Highlights

  • Quarterly net sales were $57.2 million, a decrease of $3.0 million, or 5.0 percent, compared with net sales of $60.2 million for the comparable quarter last year.
  • Quarterly gross margin was 45.6 percent, compared with quarterly gross margin of 48.0 percent for the comparable quarter last year.
  • Quarterly GAAP net income was $2.1 million, or 16 cents per diluted share, compared with GAAP net income of $3.1 million, or 24 cents per diluted share, for the comparable quarter last year.
  • Quarterly non-GAAP net income was $3.7 million, or 29 cents per diluted share, compared with non-GAAP net income of $4.9 million, or 37 cents per diluted share, for the comparable quarter last year. GAAP to non-GAAP adjustments for net income exclude acquired intangible amortization, stock compensation, and other costs.
  • Quarterly non-GAAP Adjusted EBITDA was $6.5 million, or 11.3 percent of net sales, compared with Adjusted EBITDA of $7.5 million, or 12.4 percent of net sales, for the comparable quarter last year.

Brian Murphy, president and CEO, said, “Our commitment to innovation, paired with disciplined execution of our long-term strategy to enter new outdoor categories, is fueling the strength of our growth brands and the engagement we are seeing from consumers and retail partners. Pull-through of our products at retail was notably strong during the quarter, with total POS up 4 percent year-over-year. Together, these factors enabled us to deliver second-quarter results that surpassed our expectations, even amid a dynamic retail backdrop.

“Similar to our first quarter, retailer ordering patterns during the second quarter continued to vary by partner. That said, purchasing activity – including purchasing activity from our largest e-commerce retailer – was largely concentrated in the final two months of the quarter, driving strong late-quarter orders and yielding total revenue that declined just 5 percent year over year, a favorable result given recent market conditions.

“Our results also reflected the continued expansion of our product and brand offerings within our existing retail partner network, including the mass-market channel, in alignment with our long-term growth strategy. Our partners are increasingly turning to our innovative and popular brands, such as Caldwell and BOG, to strengthen their assortments and help drive consumer foot traffic. Taken together, these trends reinforce our view that our strategy is effective and that our brands are continuing to win at retail.

“Our innovation engine was firing on all cylinders this quarter. New products drove over 31 percent of net sales, demonstrating the power and consistency of our pipeline. We also locked in several launches for SHOT Show in January, including major expansions to our successful Caldwell ClayCopter and Claymore lines for shotgun enthusiasts. At SHOT, we’ll unveil the Caldwell ClayCopter Surface-to-Air Launcher – a complete reimagining of our handheld disc launcher into a compact, lightweight, wireless ground unit featuring a 50-disc hopper and seamless integration with our new Caldwell Clays app. Multiple units can be tethered together for greater challenge and fun, laying the groundwork for future gamification. The Caldwell Clays app also makes Caldwell the only brand to bring disc- and clay-shooting together for the first time. Users can pair ClayCopter Surface-to-Air units with our new wireless electronic clay thrower, the Claymore Connect, coordinating disc and clay launches simultaneously for the most dynamic shotgun-training and recreational shooting experience ever. I believe our innovation pipeline is the strongest in our company’s history – and this is only the beginning. We don’t just participate in categories, we reshape them.”

Andrew Fulmer, chief financial officer, said, “In the second quarter, net sales came in well ahead of our expectations, and we delivered solid gross margins of over 45 percent. This performance is noteworthy given the actions we took to clear certain slow-moving inventory, and the higher tariff and freight costs we absorbed during the period. Our balance sheet remains strong and continues to give us the flexibility to support our strategic objectives. During the quarter, we repurchased approximately 74,000 shares of our common stock for $662,000, and we ended the period debt-free with $3.1 million in cash. We believe this solid financial position allows us to continue pursuing disciplined growth opportunities that drive long-term value for our shareholders.”

Third Quarter and Fiscal 2026 Outlook
Fulmer continued, “You’ll recall that in our prior fiscal year, which ended April 30, 2025, we reported that retailers had accelerated approximately $10 million in orders originally slated for our current fiscal year, as they sought to get ahead of impending tariffs. That action allowed us to deliver full fiscal 2025 net sales of $222 million – a favorable result, but one that created a challenging comparison for fiscal 2026. We are now seven months into fiscal 2026, and we are pleased with our performance – especially given the macro challenges that have characterized the year: tariffs, cautious retailer buying, and an uncertain consumer environment.

“Based on what we know today, we believe the full fiscal year could deliver net sales down 13 percent to 14 percent from last year’s $222 million. That percentage would include the $10 million in orders accelerated into our prior year. Adjusting for those orders, the underlying net sales decline would be approximately 5 percent – performance we would view as extremely positive given the current environment. We expect net sales in the third quarter to decline approximately 8 percent year over year, reflecting current retailer dynamics. Lastly, we expect gross margin for both the full year and the third quarter to be in the range of 42 percent to 43 percent, and we expect Adjusted EBITDA for the full year to be in the range of 4.0 percent to 4.5 percent of net sales.”

Image courtesy American Outdoor Brands