Sturm, Ruger & Company, Inc. reported a sharp decline in earnings in the first quarter due to incremental expenses associated with negotiating a Strategic Cooperation Agreement with Beretta Holding S.A. and organizational changes implemented in February.

On May 4, Ruger and Beretta entered an agreement with Beretta that enables Beretta to nominate up to two independent board members and increase its ownership stake in Ruger to 25 percent. The agreement comes after Italy-based Beretta had acquired a 9.95 percent stake in Ruger last year and eventually nominated a slate of four director candidates for election to Ruger’s board. In late March, Beretta made an offer to acquire up to 20.05 percent of Ruger’s outstanding shares at a premium. 

Ruger adopted a shareholder-rights plan, or poison pill, last fall and ultimately charged that Beretta was contemplating a hostile takeover.

First Quarter 2026 Financial Highlights

  • Ruger achieved net sales of $141.4 million, a 4.1 percent increase over the $135.7 million achieved in the corresponding period in 2025.
  • Diluted earnings were 1 cents per share compared to 46 cents per share in the corresponding period
    in 2025.
  • On an adjusted basis, diluted earnings for the first quarter of 2026 were 27 cents per share compared to 46 cents per share in the corresponding period in 2025.

Ruger said it incurred legal, professional and advisory fees and other expenses totaling approximately $3.2 million related to the agreement negotiations and other related matters during the quarter. These expenses are “largely non-recurring, limited in duration and do not, in the opinion of management, relate to the underlying performance of the core business. Additional Agreement-related expenses may be incurred in the near term.”

Ruger said it also incurred a one-time non-recurring expense of $1.7 million, or 7 cents per share, not included in the adjusted earnings per share.

Additionally, in February, the company executed a reduction-in-force as part of broader efforts to structurally align the organization to strategic priorities and the future operating model. These actions are consistent with the changes outlined in the 2026 Plan and, more broadly, the Ruger 2030 framework. The moves improve efficiency, enhance accountability and position the company for long-term profitable growth. The associated severance and related expense of $2.5 million were recognized in the quarter and are not, in the opinion of management, indicative of ongoing operations.”

Taken together, the “two discrete items reflect actions to ensure the company’s independence and strengthen its operational foundation,” both of which Ruger said support shareholder interests,” according to Ruger.

As previously disclosed, the Board of Directors declared a dividend of 11 cents per share for the first quarter for shareholders of record as of May 14, 2026, payable on May 29, 2026. This dividend equates to approximately 40 percent of adjusted net income of 27 cents per share for the first quarter of 2026.

“Our first quarter results reflect both the strength of our underlying business and the actions we have taken to position Ruger for the future,” said Todd Seyfert, president and CEO. “Building on our momentum in 2025, we continue to focus on innovation, have great demand across our offerings and see encouraging signs in the market. This quarter was our fourth consecutive quarter of year-over-year sales growth as we continue to outperform the market in top-line sales.”

Additional Highlights

  • The estimated sell-through of the company’s products from the independent distributors to retailers in Q1 2026 increased by 3.2 percent from Q1 2025, exceeding a 1.6 percent increase in adjusted NICS during the same period.
  • Sales of new products, including the RXM pistol, Marlin 1894 lever-action rifles, American Centerfire Rifle Generation II, Glenfield rifles, Harrier rifles, and the Ruger Red Label III Shotgun, represented $51.6 million, or 41 percent, of firearm sales for the quarter. New product sales include only major new products that were introduced in the past two years.
  • Compared to the first quarter of 2025, the company’s finished goods inventories decreased
    95,800 units while distributors’ inventories decreased 26,400 units, reflecting strong retail pull
    through of our new products.
  • For Q1 2026, cash generated from operations totaled $18.8 million. As of March 28, 2026, Ruger’s cash and short-term investments totaled $105.2 million. The company’s current ratio is 3.5 to 1 and there is no debt.
  • In the first three months of 2026, capital expenditures totaled $4.8 million. The company expects capital expenditures to total $30 million for the year for continued investments in new product introductions, expanded capacity for product lines in greatest demand, upgraded manufacturing capabilities and strengthened facility infrastructure.
  • In the first 3 months, the company returned $1.3 million to its shareholders through the payment of quarterly dividends. The company did not repurchase any shares of its common stock during the period.

“While we are extremely excited about our 2026 plan and approach, we remain focused on improving our overall cost structure and profitability,” Seyfert added. “The actions we took during the quarter – both in protecting the interests of shareholders and driving cost out of the organization – are already contributing to a more focused and efficient operating model. As these temporary expenses roll off, we expect improved visibility into the underlying earnings power of the business.”

Image courtesy Ruger