Solo Brands, Inc. — Fiscal 2026 Third Quarter Earnings Summary

Financial Performance:

• Consolidated net sales for the three months ended September 30, 2026, were $43.7 million, a 17.6% decrease from $53.0 million in the prior year period.
• Consolidated net sales for the nine months ended September 30, 2026, were $195.1 million, a 12.4% decrease from $222.5 million in the prior year period.
• Gross profit for the third quarter was $27.7 million (63.4% of net sales), compared to $31.8 million (60.0% of net sales) in the prior year; adjusted gross profit was $28.2 million (64.4% of net sales) versus $32.2 million (60.6% of net sales).
• Gross profit for the nine months was $113.6 million (58.3% of net sales), compared to $131.1 million (58.9% of net sales) in the prior year; adjusted gross profit was $116.0 million (59.5% of net sales) versus $131.9 million (59.3% of net sales).
• Operating expenses for the third quarter were $42.1 million, a 12.3% decrease from $48.0 million in the prior year.
• Operating expenses for the nine months were $129.3 million, a 22.9% decrease from $167.7 million in the prior year.
• Selling, general & administrative expenses for the third quarter were $31.6 million, a 20.0% decrease from $39.5 million in the prior year.
• Selling, general & administrative expenses for the nine months were $107.4 million, a 14.9% decrease from $126.2 million in the prior year.
• Restructuring, contract termination, and impairment charges were $6.0 million for the third quarter (up from $1.9 million) and $8.2 million for the nine months (down from $18.0 million).
• Net loss attributable to Solo Brands, Inc. for the third quarter was $20.8 million ($8.08 diluted loss per share), compared to $15.0 million ($9.22 diluted loss per share) in the prior year.
• Net loss attributable to Solo Brands, Inc. for the nine months was $30.6 million ($12.03 diluted loss per share), compared to $40.7 million ($26.59 diluted loss per share) in the prior year.
• Adjusted net loss attributable to Solo Brands, Inc. for the third quarter was $11.6 million ($4.51 adjusted diluted loss per share), compared to $7.1 million ($4.33 adjusted diluted loss per share) in the prior year.
• Adjusted net loss attributable to Solo Brands, Inc. for the nine months was $15.2 million ($5.96 adjusted diluted loss per share), compared to $11.8 million ($7.71 adjusted diluted loss per share) in the prior year.
• Adjusted EBITDA for the third quarter was $(2.1) million (-4.9% of net sales), an improvement from $(5.1) million (-9.6% of net sales) in the prior year.
• Adjusted EBITDA for the nine months was $13.0 million (6.6% of net sales), an improvement from $8.9 million (4.0% of net sales) in the prior year.
• Net cash provided by operating activities for the nine months ended September 30, 2026, was $26.0 million, compared to net cash used of $53.0 million in the prior year period.
• Cash and cash equivalents were $40.2 million as of September 30, 2026, compared to $20.0 million as of December 31, 2025.
• Inventory was $59.2 million as of September 30, 2026, a decrease from $81.6 million as of December 31, 2025.
• Outstanding borrowings under the 2025 Term Loan were $264.4 million as of September 30, 2026, including interest paid-in-kind; no borrowings were outstanding under the 2025 Revolving Credit Facility.
• Availability under the 2025 Revolving Credit Facility was $50.3 million as of September 30, 2026.
• Deferred revenue was $1.2 million as of September 30, 2026, down from $1.6 million as of December 31, 2025.

Guidance and Future Outlook:

• Full-year 2026 net sales guidance is updated to a range of $270 million to $290 million, based on the lower end of the original guidance range.
• Full-year 2026 adjusted EBITDA guidance is updated to a range of $21 million to $25 million.
• Management indicated entering the holiday 2026 season with a leaner inventory position, strong liquidity, and growing momentum in newest products.
• The company remains focused on driving sustainable growth, profitability, and long-term shareholder value.

Business Segments and Product Lines:

• Solo Stove:
  • Third quarter net sales were $24.7 million, down 19.9% from the prior year, driven by lower unit volumes in core fire pits and retail channel softness, partially mitigated by new product introductions.
  • Nine months net sales were $73.4 million, down 22.9% from the prior year.
  • Segment adjusted EBITDA for the third quarter was $2.3 million (9.4% of net sales), up from $1.4 million (4.4% of net sales).
  • Segment adjusted EBITDA for the nine months was $4.3 million (5.9% of net sales), up from $3.3 million (3.4% of net sales).
  • New products launched over the past year represented nearly half of the Solo Stove website sales during the third quarter.
• Chubbies:
  • Third quarter net sales were $13.7 million, down 16.8% from the prior year, reflecting variability in customer demand across DTC and retail channels.
  • Nine months net sales were $91.0 million, down 12.2% from the prior year.
  • Segment adjusted EBITDA for the third quarter was $0.2 million (1.2% of net sales), an improvement from a loss of $1.2 million (-7.5% of net sales).
  • Segment adjusted EBITDA for the nine months was $20.2 million (22.2% of net sales), compared to $21.5 million (20.8% of net sales).
• Watersports:
  • Third quarter net sales were $5.3 million, down 7.4% from the prior year, due to softer sales on less promotional activity in DTC, partially offset by increased retail demand.
  • Nine months net sales were $30.6 million, up 32.4% from the prior year, driven by an expanded partnership with a key retail customer, partially offset by softer DTC sales.
  • Segment adjusted EBITDA for the third quarter was $0.5 million (8.9% of net sales), compared to $0.5 million (8.3% of net sales).
  • Segment adjusted EBITDA for the nine months was $5.3 million (17.4% of net sales), up from $2.8 million (12.3% of net sales).
• The company is expanding consumer engagement through influencer-led marketing, social commerce initiatives, and platforms such as TikTok Shop.

Market and Competitive Landscape:

• The company operates in a highly competitive market, as noted in forward-looking statement risk factors.
• Sales declines were attributed to softness in the retail channel for Solo Stove and variability in customer demand for Chubbies.
• The Watersports segment saw growth driven by an expanded partnership with a key customer within the retail channel.

Risks and Challenges:

• Revenue performance remains below expectations.
• The company faces risks related to its ability to continue as a going concern, limited liquidity, and reliance on cash generated from operations.
• Significant debt obligations exist, including $264.4 million in outstanding borrowings under the 2025 Term Loan.
• The company is subject to risks regarding tariffs, reliance on third-party manufacturers outside the U.S., and potential supply chain disruptions.
• Restructuring and cost-reduction efforts are ongoing, including the closure of the Oru manufacturing facility and distribution centers, which resulted in inventory write-offs and impairment charges.
• The company has not provided a quantitative reconciliation of forecasted adjusted EBITDA to forecasted GAAP net income due to the inability to calculate certain reconciling items with confidence without unreasonable effort.

Management Commentary and Tone:

• John Larson, President and CEO, stated that while the third quarter is typically the seasonally smallest sales quarter, the company made measurable progress strengthening the business.
• Management highlighted improved segment profitability, generation of more than $6 million of operating cash flow, and advancement of the transformation strategy through disciplined execution.
• Management expressed encouragement regarding improving consumer engagement and the strong response to recent product innovation.
• The tone reflected a focus on building a more resilient, leaner, cash-generative company.

Other Key Points:

• Effective January 1, 2026, the Company completed a Corporate Simplification transaction resulting in all outstanding Class B common stock being cancelled and exchanged for Class A common stock on a one-for-one basis.
• The 2025 Credit Agreement amendment entered into on June 13, 2025, consists of a $240 million term loan and a $90 million revolving credit facility.
• A conference call to discuss results was scheduled for November 12, 2026, at 9:00 a.m. ET.
• The company employs approximately 300 associates and is headquartered in Grapevine, Texas.