American Outdoor Brands Reports Decline in Revenue and Profitability for Q2 Fiscal 2026

American Outdoor Brands, Inc. reported its financial results for the second quarter of fiscal 2026, revealing a decline in both revenue and profitability compared to the same period last year. For the three months ended October 31, 2025, the company generated net sales of $57.2 million, a decrease of 5.0% from $60.2 million in the prior year. Gross profit also fell to $26.1 million, down from $28.9 million, resulting in a gross margin of 45.6%, which is a 240 basis point decline year-over-year. The company recorded net income of $2.1 million, or $0.16 per diluted share, compared to $3.1 million, or $0.24 per diluted share, in the same quarter last year.

For the six-month period ending October 31, 2025, American Outdoor Brands experienced a more significant downturn, with net sales of $86.9 million, down 14.7% from $101.9 million in the previous year. The company reported a net loss of $4.8 million, or $(0.37) per diluted share, contrasting sharply with a net income of $746,000, or $0.06 per diluted share, for the same period in the prior year. The decline in sales was attributed to several factors, including reduced consumer demand and inventory management actions by key customers, particularly in the e-commerce channel, which saw a 23.7% drop in sales.

Operationally, the company noted a decrease in its e-commerce sales, which fell to $31.1 million for the six months, down from $40.8 million. Traditional channel sales also declined by 8.7%, reflecting a broader trend of reduced consumer spending. Despite these challenges, new products introduced in the last two fiscal years accounted for 31.4% of net sales in the most recent quarter, indicating some level of product adoption among consumers. The company’s inventory levels increased to $124.0 million, up from $104.7 million, as it prepared for seasonal demand and new product launches.

In terms of strategic developments, American Outdoor Brands has been focusing on cost management, with total operating expenses decreasing by 7.1% in the most recent quarter. The company has also been actively repurchasing its common stock, utilizing $3.2 million to buy back shares during the first half of the fiscal year. Looking ahead, the company anticipates that its future capital requirements will depend on various factors, including net sales performance, product development spending, and potential acquisitions. The management expressed a commitment to investing in growth strategies while navigating the current market conditions, which include increased tariffs and supply chain challenges.

Overall, American Outdoor Brands is facing significant headwinds in its financial performance, with a clear need to adapt to changing market dynamics and consumer preferences. The company’s outlook remains cautious as it aims to stabilize its operations and return to profitability in the coming quarters.