Turning Point Brands — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total consolidated net sales increased 27.0% year-over-year to $151.1 million.
• Gross profit increased 20.9% to $85.2 million.
• Net income decreased 81.4% to $3.9 million.
• Adjusted EBITDA decreased 41.3% to $18.4 million, driven by increased sales and marketing investments.
• Diluted EPS was $0.19 compared to $1.13 in the prior year period; Adjusted Diluted EPS was $0.41 compared to $1.05.
• Consolidated selling, general, and administrative (SG&A) expenses increased 69.1% to $75.3 million.
• Ending cash was $251.3 million; net debt was $48.7 million.
• Total liquidity ended the quarter at $322.8 million, including $71.5 million of asset-backed revolving credit facility capacity.

Guidance and Future Outlook:

• Reaffirmed full-year 2026 guidance for Modern Oral Gross Sales of $330-$350 million.
• Reaffirmed full-year 2026 guidance for Modern Oral Net Sales of $260-$270 million.
• Reaffirmed full-year 2026 guidance for Adjusted EBITDA of $70-$80 million.

Business Segments and Product Lines:

• Stoker's segment net sales increased 52.0% to $113.8 million, representing 75% of total net sales; segment gross profit increased 41.5% to $63.7 million.
• Modern Oral gross sales increased 114.2% to $93.9 million, with net sales increasing 102.9% to $74.4 million, accounting for 49.2% of total company net sales.
• Zig-Zag segment net sales decreased 15.5% to $37.3 million, representing 25% of total net sales; segment gross profit decreased 15.6% to $21.4 million.
• Stoker's segment gross profit margin decreased to 56.0% from 60.2% due to a product mix shift toward Modern Oral.
• Zig-Zag segment gross profit margin decreased slightly to 57.4% from 57.5%.
• Investments in FRE and ALP are expanding distribution and strengthening consumer engagement in the nicotine pouch category.

Market and Competitive Landscape:

• The company positions itself to become a leading player in the rapidly growing nicotine pouch category.
• Products are available in more than 220,000 retail outlets in North America.

Risks and Challenges:

• Gross profit margins decreased in both segments due to product mix shifts and increased sales and marketing investments.
• Net income and Adjusted EBITDA declined significantly compared to the prior year period.
• Forward-looking statements involve risks and uncertainties, including regulatory factors and market conditions that may cause actual results to differ materially from expectations.

Management Commentary and Tone:

• CEO David Glazek expressed high optimism, stating he has "never been more optimistic about its future" and has "tremendous confidence in our team, our brands and our strategy."
• Management highlighted continued growth in Modern Oral and progress across heritage brands.
• The company remains focused on maximizing long-term shareholder value through the nicotine pouch opportunity.

Other Key Points:

• The Company repurchased 167,161 shares during the quarter for a total cost of $10.0 million at an average price of $59.82 per share.
• Total cost of repurchased common stock increased to $31.171 million as of September 30, 2026, from $47.637 million at December 31, 2025.
• A conference call to review results was scheduled for November 9, 2026, at 9:00 a.m. Eastern.
• The press release includes non-GAAP financial measures including EBITDA, Adjusted EBITDA, Adjusted Net Income, and Adjusted Diluted EPS with reconciliations provided.