Cricut (CRCT) investor relations material

Executive summary

• Q2 2026 revenue was $156.3 million, down 9% year-over-year, with platform revenue up 5% to $85.0 million and products revenue down 22% to $71.3 million, reflecting a platform-first strategy and double-digit machine sell-out growth.

• Net income rose to $39.1 million, up 59–60% year-over-year, driven by improved gross margins, IEEPA tariff refunds, and a royalty settlement.

• Paid subscribers increased by 93,000 to 3.1 million, with ARPU up 5% to $56.37 and active users nearing 6 million.

• Investments in innovation, marketing, and AI-powered features, including a new global campaign, are expected to drive long-term growth.

• Focus remains on user acquisition, engagement, and monetization through expanded product offerings and marketing.

Financial highlights

• Q2 2026 revenue was $156.3 million, down 9–9.2% year-over-year.

• Net income reached $39.1 million (25% of sales), up from $24.5 million in Q2 2025.

• Platform revenue grew 5% to $85.0 million; product revenue fell 22% to $71.3 million.

• Gross margin improved to 74.5% (up from 59–60.2% in Q2 2025), boosted by $17.9 million in IEEPA tariff refunds and a $6.4 million royalty settlement.

• Operating income was $47.4 million (30.3% of revenue), with an effective tax rate of 22.4%.

Outlook and guidance

• Platform revenue is expected to grow each quarter, with product and platform growth projected in the second half of 2026.

• Profitability and positive cash flow are anticipated for each quarter and the full year.

• No detailed margin guidance due to ongoing tariff and cost uncertainties.

• Management expects continued cost pressures from global supply chain disruptions and higher input costs.

• Continued investment in R&D, marketing, and international expansion.