GrowGeneration Reports 7.5% Sales Increase to $38.4 Million in Q1 2026

GrowGeneration Corp. reported its financial results for the first quarter of 2026, revealing a net sales increase of 7.5% to $38.4 million, compared to $35.7 million in the same period last year. The growth was primarily driven by the Cultivation and Gardening segment, which generated $31.9 million in sales, up from $30.9 million. This increase was attributed to a rise in durable product sales, reflecting heightened capital investments by customers. However, the company faced challenges due to the closure of four retail locations during the quarter, which impacted overall sales performance.

The company's cost of sales also rose, increasing by 10.2% to $28.7 million, which was in line with the sales growth but outpaced it due to a higher sales mix of durable products and inventory disposal costs associated with the retail closures. Gross profit remained stable at $9.7 million, but the gross profit margin decreased to 25.4% from 27.2% year-over-year, primarily due to the lower margins associated with durable products and additional costs incurred during the retail location closures.

Operating expenses saw a significant reduction, dropping 23.4% to $15.0 million, down from $19.6 million in the prior year. This decline was largely due to the closure of underperforming retail locations and cost rationalization initiatives. The company reported a loss from operations of $5.3 million, an improvement from the $9.9 million loss in the same quarter of 2025. The net loss for the quarter was $4.9 million, or $0.08 per share, compared to a net loss of $9.4 million, or $0.16 per share, in the previous year.

As of March 31, 2026, GrowGeneration operated 19 retail locations across nine states, having closed four stores during the quarter. The company continues to evaluate its retail footprint to optimize operations and leverage its online sales platform. Additionally, the company has been focusing on expanding its proprietary brand offerings and enhancing its e-commerce capabilities. The strategic restructuring plan initiated in 2024 has been largely completed, with no significant additional costs expected in the future.

Looking ahead, GrowGeneration remains cautious about the evolving trade environment and its potential impact on costs and supply chains. The company is actively monitoring these developments and adjusting its strategies accordingly. Management believes that the current liquidity position is sufficient to fund operations and meet obligations for at least the next twelve months, although additional financing may be required for future growth initiatives.