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Leatt Corporation — Third Quarter 2026 Earnings Summary

LEAT

  • Financial Performance:

    • Q3 2026 global revenues increased 43% year-over-year to $20.46 million, compared to $14.34 million in Q3 2025, marking the highest quarterly revenue in four years.
    • For the nine months ended September 30, 2026, revenues increased 23% to $56.36 million, compared to $45.89 million in the same period in 2025.
    • Q3 2026 net income increased 309% to $2.20 million ($0.35 basic, $0.34 diluted per share), compared to $0.54 million ($0.09 basic, $0.08 diluted) in Q3 2025.
    • Net income for the nine months ended September 30, 2026, increased 74% to $4.88 million ($0.78 basic, $0.76 diluted per share), compared to $2.80 million ($0.45 basic, $0.43 diluted) in 2025.
    • Gross profit for Q3 2026 increased 48% to $9.32 million; gross profit margin improved to 45% from 43% for the nine-month period.
    • Operating costs grew 15% in Q3 2026 while revenues grew 43%, lifting the net margin to 10.8% from 3.8% a year ago.
    • Cash flows provided by operating activities were $4.59 million for the first nine months of 2026, compared to $1.45 million in the same period in 2025.
    • Cash, cash equivalents, and restricted cash increased by $2.27 million since year-end to $15.50 million at September 30, 2026.
    • Inventory decreased by $1.60 million since year-end to $19.30 million, reflecting strong sell-through.
    • The current ratio at September 30, 2026, was 4.7:1.
    • Accounts receivable increased to $13.63 million from $7.90 million at December 31, 2025.
    • Total liabilities decreased to $11.65 million from $9.81 million at December 31, 2025, primarily due to the repayment of a short-term loan and notes payable.
    • Total stockholders' equity increased to $47.33 million from $42.23 million at December 31, 2025.

  • Guidance and Future Outlook:

    • Management expressed optimism that the momentum gained in Q3 2026 will continue into the fourth quarter and sustain a solid year for 2026.
    • The company anticipates robust international re-ordering patterns and continued domestic sales momentum at dealer and consumer levels.
    • Leatt plans to continue investing in building the brand as a global consumer brand and expanding its pipeline of innovative products.
    • Management noted potential geopolitical headwinds but remains confident in the traction gained.

  • Business Segments and Product Lines:

    • Sales to global distributors increased 52%, dealer direct revenues increased 24%, and consumer direct sales increased 25% in Q3 2026.
    • U.S. revenues increased 24% to $5.33 million in Q3 2026; international revenues increased 50% to $15.12 million.
    • Body armor sales increased by $2.93 million, helmet sales by $2.25 million, and other products/parts/accessories by $1.04 million in Q3 2026.
    • Neck brace sales declined slightly by $0.11 million in Q3 2026, contrasting with a 39% volume growth in the prior-year quarter.
    • Consumer direct sales for the nine months ended September 30, 2026, increased 48% to $5.24 million.
    • Helmet sales for the nine months ended September 30, 2026, were up 48%, and footwear revenues were up 67%.
    • Launched GRiTT by Leatt, the company's first consumable product line (premium bike care products), with initial shipments exceeding expectations.
    • Launched two MTB flat-pedal riding shoes featuring SuperTack technology designed to maximize grip.
    • Introduced the 2027 MOTO 5.5 Racewear range featuring HeatGrip technology, a durable inner-knee material replacing leather.

  • Market and Competitive Landscape:

    • The company operates in the MOTO, MTB, ADV, and extreme/high-velocity sports protective equipment market.
    • Participation in these sports remains strong, driving demand for the expanding product line.
    • The company is actively building out its global team of sales, marketing, and brand management professionals.
    • The company recently held a global distributor conference in Barcelona, reporting high enthusiasm among partners regarding the product pipeline and brand expansion.

  • Risks and Challenges:

    • Potential geopolitical headwinds remain a factor, though management believes traction will continue.
    • Forward-looking statements involve risks and uncertainties, including factors described in the company's Form 10-K filed March 24, 2026, which could cause actual results to differ materially from expectations.
    • Specific risks include market growth expectations, competition, and the ability to achieve profitability from increased production volumes.

  • Management Commentary and Tone:

    • CEO Sean Macdonald described Q3 2026 as a "strong quarter by nearly every measure," highlighting broad-based growth across product categories.
    • Macdonald attributed gross profit growth in part to the recoupment of global trade tariffs levied on U.S. imports.
    • Founder and Chairman Dr. Christopher Leatt emphasized the depth of the product pipeline and the company's focus on innovation to improve the riding experience.
    • The tone of management commentary is confident and optimistic regarding future growth and brand engagement.

  • Other Key Points:

    • The company repurchased $181,555 of common stock during the first nine months of 2026 under its share repurchase program.
    • A conference call to discuss results was held on November 12, 2026, at 10:00 am ET.
    • The company maintains an OTCQB listing under the ticker symbol LEAT.
    • Product royalty income increased to $204,397 in Q3 2026 from $51,300 in Q3 2025.
    • Research and development costs were $742,050 in Q3 2026 compared to $688,223 in Q3 2025.
    • Advertising and marketing expenses were $1,452,666 in Q3 2026 compared to $1,157,331 in Q3 2025.