Solo Brands (DTC) Q1 2026 earnings summary

Executive summary

• Net sales for Q1 2026 were $62.9 million, down 18.6% year-over-year, mainly due to declines in Solo Stove and Chubbies, but cost reduction and profitability focus led to improved operating loss and positive adjusted EBITDA.

• Operating expenses dropped significantly due to disciplined spend management, payroll reductions, and restructuring, including a reduction in force and compensation adjustments.

• Product innovation and selective investment continued, with new launches in Stove and Watersports divisions performing well and supporting sales momentum in April and early May.

• The company completed a corporate simplification merger, consolidating all equity into Class A shares and simplifying its tax structure.

• Full-year 2026 outlook reaffirmed, emphasizing disciplined execution, cash generation, and sustainable profitability.

Financial highlights

• Consolidated net sales were $62.9 million, down 18.6% year-over-year, with gross profit of $32.9 million (52.3% margin), reflecting lower sales and margin compression from tariffs and channel mix.

• Net loss attributable was $5.5 million ($2.18 per share), improved from $12.2 million ($8.27 per share) last year; adjusted net loss was $7.5 million ($2.98 per share) versus $4.7 million ($3.18 per share).

• Adjusted EBITDA was $1.6 million (2.5% margin), down from $3.5 million (4.5% margin), mainly due to tariff impacts and retail order timing.

• SG&A expenses decreased 14.8% to $33.2 million, reflecting lower distribution, employee, and marketing costs.

• Cash and cash equivalents at quarter end: $16.5 million, with $63.6 million available under the revolving credit facility.

Outlook and guidance

• Full-year 2026 outlook reaffirmed, with net sales expected between $280 million and $310 million and adjusted EBITDA guidance of $24 million to $30 million.

• Guidance assumes continued uneven demand, tariff impacts, and benefits from ongoing payroll reductions and restructuring.

• Management expects to remain in compliance with financial covenants for at least the next twelve months, supported by cost reduction initiatives and potential tariff refunds.

• Investments of $3–$4 million planned for growth capital, focused on product innovation.

• Business is expected to remain strongest in the second and fourth quarters.