Rocky Brands Reports 9.1% Net Sales Increase to $124.4 Million in Q1 2026

Rocky Brands, Inc. reported a net sales increase of 9.1% for the first quarter of 2026, reaching $124.4 million compared to $114.1 million in the same period last year. The growth was driven by higher sales across all three of its reportable segments: Wholesale, Retail, and Contract Manufacturing. However, the company experienced a decline in gross margin, which fell to 36.5% from 41.2% year-over-year, primarily due to increased costs associated with tariffs and sourcing variances. Net income for the quarter was $1.3 million, a significant decrease from $4.9 million in the prior year, resulting in earnings per share of $0.17, down from $0.66.

In terms of operational metrics, Rocky Brands reported a decrease in inventory levels, which fell by 1.6% to $172.6 million compared to the previous year. The company’s total debt also decreased by 5.0% to $122.2 million, reflecting ongoing efforts to manage its financial obligations effectively. The company maintained a strong liquidity position with cash and cash equivalents of $1.7 million and $48.5 million available under its asset-based lending facility as of March 31, 2026.

Strategically, Rocky Brands has focused on expanding its Retail segment, which saw a 16.5% increase in sales to $42.7 million, attributed to enhancements in its e-commerce platform and increased digital marketing efforts. The company also reported growth in its Contract Manufacturing segment, with sales rising 25.0% to $3.3 million, largely due to increased orders from the U.S. Military. The Wholesale segment contributed $78.4 million in sales, up 4.8% from the previous year, driven by demand for key styles and brands.

Looking ahead, Rocky Brands is navigating a complex macroeconomic environment characterized by evolving tariffs and trade policies. The company has begun filing for refunds related to previously paid tariffs following recent court rulings, which may provide additional financial relief. Management remains cautious about potential impacts from ongoing tariff changes and is implementing strategies to mitigate risks, including adjusting product pricing and sourcing strategies. The company’s outlook emphasizes a commitment to leveraging its brand portfolio and operational efficiencies to drive future growth while maintaining compliance with financial covenants associated with its credit facilities.