Clarus Corp. reported sales grew 4.1 percent the third quarter ended September 30 as a 16 percent jump in its Adventure segment offset a 1 percent decline in its Outdoor segment, which includes Black Diamond. The decrease in Outdoor sales was due to a shift in timing for independent global distributor revenues into the second quarter, lower DTC revenues, and lower PIEPS revenue due to its sale, partially offset by a 16 percent increase in North America wholesale revenue.

Third quarter highlights

  • Sales of $69.3 million compared to $67.1 million.
  • Gross margin was 35.1 percent compared to 35.0 percent; adjusted gross margin of 35.1 percent compared to 37.8 percent.
  • Net loss of $1.6 million, or $(0.04) per diluted share, compared to net loss of $3.2 million, or $(0.08) per diluted share.
  • Adjusted net income of $1.8 million, or 5 cents per diluted share, compared to adjusted net income of $1.9 million, or 5 cents per diluted share.
  • Adjusted EBITDA of $2.8 million with an adjusted EBITDA margin of 4.0 percent compared to $2.4 million with an adjusted EBITDA margin of 3.6 percent.

Management Commentary
“During the third quarter, we continued to navigate a challenging global consumer landscape,” said Warren Kanders, Clarus’ executive chairman. “Amidst the macro uncertainty, particularly with respect to evolving tariff policies and consumer behavior, our focus is on controlling what we can to position Clarus for sustainable, profitable growth as market conditions normalize. We continued to make incremental progress against our operational initiatives, reflected in Q3 revenue and adjusted EBITDA growth year-over-year. Under the new leadership team, Adventure segment sales increased 16 percent, supported by solid results in the core Australia market. A key highlight in the Outdoor segment has been the success of the revamped Black Diamond apparel line, which saw sales growth of 29 percent over the prior year period. We continued to advance our overall strategic plan during the quarter, prioritizing our best customers and most profitable products and styles in Outdoor, and simplified the organizational structure at Adventure.”

“As we look toward the future, we are focused on unlocking the intrinsic value at each of the Outdoor and Adventure segments, especially as we consider the disconnect between the sum of the parts value of our two segments and today’s market valuation. After multiple quarters of disciplined execution and operational progress, Black Diamond is emerging from a period of considerable transformation as a more resilient and focused business poised to capitalize on growth opportunities ahead. At Adventure, we are taking steps to align our cost structure and strategic roadmap with market realities. We continue to believe that the business is only beginning to tap into significant growth opportunities in the Americas and in Europe, and we are committed to fitting more vehicles across the globe to drive this growth. Across both segments, we are focused on near-term actions that will enhance profitability and set the stage for long-term value creation.”

Third Quarter 2025 Financial Results

  • Sales in the third quarter were $69.3 million compared to $67.1 million in the same year‐ago quarter. Sales in the Outdoor segment decreased 1 percent to $48.7 million, compared to $49.3 million in the year-ago quarter. Sales in the Adventure segment, which includes , which includes the Rhino-Rack, MaxTrax and RockyMounts businesses, increased 16 percent to $20.7 million, compared to $17.8 million in the year-ago quarter.
  • The decrease in Outdoor sales was due to a shift in timing for independent global distributor revenues into the second quarter, lower global direct-to-consumer revenues, and lower PIEPS revenue due to its sale in July 2025, partially offset by an increase in North America wholesale revenue. North America wholesale sales at Outdoor were up $3.1 million or 16 percent.
  • Increased sales in the Adventure segment reflected a favorable wholesale market in Australia for Rhino-Rack and increased contributions from the acquisition of RockyMounts. RockyMounts contributed $1.5 million of the growth compared to the prior year period.
  • Gross margin in the third quarter was 35.1 percent compared to 35.0 percent in the year‐ago quarter. The increase in gross margin was primarily due to higher volumes at the Adventure segment and a favorable product mix at the Outdoor segment. These increases were partially offset by an unfavorable product mix within the Adventure segment, tariff impacts at both segments, lower volumes at the Outdoor segment due to the sale of PIEPS, and unfavorable foreign currency impacts at the Outdoor segment.
  • Selling, general and administrative expenses in the third quarter were $26.2 million compared to $27.9 million in the same year‐ago quarter. The decrease was primarily due to lower employee-related expenses, lower costs from PIEPS due to its sale, as well as other expense reduction initiatives across both segments and at Corporate to manage costs.
  • Net loss in the third quarter of 2025 was $1.6 million, or 4 cents per diluted share, compared to net loss of $3.2 million, or 8 cents a diluted share in the year-ago quarter.
  • Adjusted net income in the third quarter of 2025 was $1.8 million, or 5 cents per diluted share, compared to adjusted net income of $1.9 million, or 5 cents per diluted share, in the year-ago quarter. Adjusted net loss excludes legal cost and regulatory matters expenses, inventory reserves, restructuring charges and transaction costs, as well as non-cash items for intangible amortization, disposal of internally developed software, contingent consideration benefits, and stock-based compensation.
  • Adjusted EBITDA from continuing operations in the third quarter was $2.8 million, or an adjusted EBITDA margin of 4.0 percent, compared to adjusted EBITDA from continuing operations of $2.4 million, or an adjusted EBITDA margin of 3.6 percent, in the same year‐ago quarter.
  • Net cash used in operating activities for the three months ended September 30, 2025, was $5.7 million compared to net cash used of $8.3 million in the prior year quarter. Capital expenditures in the third quarter of 2025 were $1.2 million compared to $1.1 million in the prior year quarter. Free cash flow for the third quarter of 2025 was an outflow of $6.9 million.

Liquidity at September 30, 2025 vs. December 31, 2024

  • Cash and cash equivalents totaled $29.5 million compared to $45.4 million.
  • Total debt of $2.0 million compared to $1.9 million.

Image courtesy Black Diamond