BRP (DOO) Q1 2026 earnings summary

Executive summary

• Q1 revenues declined 7.7%–8% year-over-year to approximately CA$1.85 billion, mainly due to lower shipments, industry softness, and inventory right-sizing, but net income surged to CA$161 million, driven by FX gains and lower expenses.

• Normalized diluted EPS fell 70% to CA$0.47, while reported diluted EPS rose to CA$2.19 due to non-recurring items.

• Free cash flow increased 34% to CA$162 million, and network inventory was reduced by 21% year-over-year.

• Outperformed the North American powersports industry at retail, especially in Canada and Latin America, despite softness in the U.S., EMEA, and Asia-Pacific.

• Announced CEO retirement by fiscal year-end and received Red Dot Design Team of the Year 2025 award.

Financial highlights

• Gross profit fell 24% to CA$395 million, with gross margin dropping to 21.4% from 26.1% year-over-year.

• Normalized EBITDA was CA$200.8 million; normalized net income dropped 71% to CA$34.6 million.

• Operating income fell 51% to CA$93.9 million; free cash flow from continuing operations rose to CA$162 million.

• Diluted EPS rose to CA$2.19 from CA$0.56, driven by FX gains; normalized EPS was CA$0.47.

• Net cash from operating activities increased to CA$214.5 million from CA$141.4 million.

Outlook and guidance

• No formal FY26 guidance issued due to ongoing macroeconomic and tariff uncertainty.

• Q2 expected to be the last quarter of significant network inventory reduction, with financial performance similar to Q1.

• New product introductions anticipated at the August Dealer Event to drive H2 demand; double-digit top-line growth and strong EBITDA/EPS improvement possible in H2 if retail trends hold.