Byrna Technologies Reports 45.7% Revenue Decline in Q3 2026

Byrna Technologies Inc. reported a significant decline in financial performance for the third quarter and nine months ended August 31, 2026, compared to the same periods in the previous year. The company generated net revenue of $15.3 million for the third quarter, a decrease of 45.7% from $28.2 million in the prior year. For the nine-month period, revenue fell by 26.7% to $60.7 million from $82.9 million. The decline was attributed to lower sales in both direct-to-consumer (DTC) and wholesale channels, with DTC sales dropping to $10.0 million from $16.3 million and wholesale sales decreasing to $3.7 million from $7.9 million. Additionally, Byrna recognized no royalty revenue from its LATAM Licensing Agreement during the quarter, compared to $0.3 million in the prior year.

The company's cost of goods sold (COGS) also decreased significantly, falling to $3.1 million in the third quarter from $11.3 million, primarily due to lower sales volumes and the receipt of tariff refunds totaling approximately $2.3 million. Gross profit for the quarter was $12.2 million, resulting in a gross margin of 79.5%, up from 60.1% in the previous year, largely due to the tariff refunds. However, operating expenses increased to $15.1 million from $14.1 million, driven by higher bad debt expenses and marketing costs. Byrna reported a net loss of $2.9 million for the quarter, a decline from a net income of $2.2 million in the same period last year.

In terms of operational developments, Byrna Technologies made a strategic acquisition of Hero Defense Systems, LLC, in August 2026, for a total consideration of $1.7 million. This acquisition is expected to enhance Byrna's product offerings in the less-lethal defense market. The company also ceased in-house ammunition production at its Fort Wayne, Indiana facility, opting to source ammunition from a third-party manufacturer. This decision led to significant inventory write-downs and impairment charges, totaling $6.0 million and $3.5 million, respectively, impacting the company's financial results.

As of August 31, 2026, Byrna's total assets decreased to $64.6 million from $84.5 million at the end of the previous fiscal year, with cash and cash equivalents dropping to $8.4 million. The company reported an accumulated deficit of approximately $59.3 million. Looking ahead, Byrna's management expressed confidence in the demand for less-lethal products and plans to continue expanding its product portfolio. However, the company acknowledged the need to generate sufficient revenue to fund operations and manage its cash flow effectively, particularly in light of the recent regulatory issues concerning its chemical irritant defense sprays.