STURM RUGER & CO INC (RGR)
SIC breadcrumb: Manufacturing > SIC Major Group 34 > SIC 3480 Ordnance & Accessories, (No Vehicles/Guided Missiles)
SEC company page: https://www.sec.gov/edgar/browse/?CIK=95029. Latest filing source: 0001174947-26-000243.
Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
|---|---|---|---|---|
| Revenue | 546,057,000 | USD | 2025 | 2026-03-02 |
| Net income | -4,391,000 | USD | 2025 | 2026-03-02 |
| Assets | 341,997,000 | USD | 2025 | 2026-03-02 |
Financials
Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-03-02. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000095029.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.
| Metric | 2009 | 2010 | 2011 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | 664,328,000 | 522,256,000 | 495,635,000 | 410,506,000 | 568,868,000 | 730,736,000 | 595,842,000 | 543,767,000 | 535,643,000 | 546,057,000 | |||||
| Net income | 87,472,000 | 52,142,000 | 50,933,000 | 32,291,000 | 90,398,000 | 155,899,000 | 88,332,000 | 48,215,000 | 30,563,000 | -4,391,000 | |||||
| Operating income | 134,409,000 | 76,349,000 | 67,009,000 | 39,375,000 | 119,148,000 | 203,136,000 | 103,456,000 | 52,084,000 | 31,654,000 | -12,299,000 | |||||
| Gross profit | 219,554,000 | 154,008,000 | 134,358,000 | 99,548,000 | 191,441,000 | 279,557,000 | 180,085,000 | 133,619,000 | 114,415,000 | 81,151,000 | |||||
| Diluted EPS | 4.59 | 2.91 | 2.88 | 1.82 | 5.09 | 8.78 | 4.96 | 2.71 | 1.77 | -0.27 | |||||
| Operating cash flow | 104,800,000 | 101,191,000 | 119,812,000 | 49,587,000 | 143,806,000 | 172,339,000 | 77,231,000 | 33,901,000 | 55,504,000 | 54,308,000 | |||||
| Capital expenditures | 35,215,000 | 33,596,000 | 10,541,000 | 20,296,000 | 24,229,000 | 28,776,000 | 27,730,000 | 15,796,000 | 20,821,000 | 15,846,000 | |||||
| Dividends paid | 5,816,000 | 6,317,000 | 42,718,000 | 110,789,000 | 11,829,000 | 10,122,000 | |||||||||
| Share buybacks | 1,999,000 | 24,002,000 | 2,841,000 | 14,018,000 | 64,850,000 | 1,995,000 | 222,000 | 11,811,000 | 34,408,000 | 26,100,000 | |||||
| Assets | 346,879,000 | 284,318,000 | 335,532,000 | 348,961,000 | 348,258,000 | 442,343,000 | 484,763,000 | 398,817,000 | 384,034,000 | 341,997,000 | |||||
| Stockholders' equity | 265,900,000 | 230,149,000 | 264,242,000 | 285,458,000 | 264,699,000 | 363,661,000 | 316,738,000 | 331,721,000 | 319,582,000 | 283,760,000 | |||||
| Cash and cash equivalents | 87,126,000 | 63,487,000 | 38,492,000 | 35,420,000 | 20,147,000 | 21,044,000 | 65,173,000 | 15,174,000 | 10,028,000 | 18,451,000 | |||||
| Free cash flow | 69,585,000 | 67,595,000 | 109,271,000 | 29,291,000 | 119,577,000 | 143,563,000 | 49,501,000 | 18,105,000 | 34,683,000 | 38,462,000 |
Ratios
| Metric | 2009 | 2010 | 2011 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Net margin | 13.17% | 9.98% | 10.28% | 7.87% | 15.89% | 21.33% | 14.82% | 8.87% | 5.71% | -0.80% | |||||
| Operating margin | 20.23% | 14.62% | 13.52% | 9.59% | 20.94% | 27.80% | 17.36% | 9.58% | 5.91% | -2.25% | |||||
| Return on equity | 32.90% | 22.66% | 19.28% | 11.31% | 34.15% | 42.87% | 27.89% | 14.53% | 9.56% | -1.55% | |||||
| Return on assets | 25.22% | 18.34% | 15.18% | 9.25% | 25.96% | 35.24% | 18.22% | 12.09% | 7.96% | -1.28% | |||||
| Current ratio | 2.65 | 3.17 | 3.26 | 4.07 | 2.87 | 4.26 | 2.22 | 4.29 | 4.25 | 3.87 |
Financial Charts
Quarterly
Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-06. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000095029.json.
| Quarter | End Date | Revenue | Net Income | Diluted EPS | Method |
|---|---|---|---|---|---|
| 2022-Q2 | 2022-07-02 | 1.17 | reported discrete quarter | ||
| 2022-Q3 | 2022-10-01 | 1.03 | reported discrete quarter | ||
| 2023-Q1 | 2023-04-01 | 0.81 | reported discrete quarter | ||
| 2023-Q2 | 2023-07-01 | 142,804,000 | 16,185,000 | 0.91 | reported discrete quarter |
| 2023-Q3 | 2023-09-30 | 120,893,000 | 7,431,000 | 0.42 | reported discrete quarter |
| 2023-Q4 | 2023-12-31 | 130,617,000 | 10,249,000 | derived Q4 = FY annual - nine-month YTD | |
| 2024-Q1 | 2024-03-30 | 136,820,000 | 7,084,000 | 0.40 | reported discrete quarter |
| 2024-Q2 | 2024-06-29 | 130,761,000 | 8,264,000 | 0.47 | reported discrete quarter |
| 2024-Q3 | 2024-09-28 | 122,287,000 | 4,738,000 | 0.28 | reported discrete quarter |
| 2024-Q4 | 2024-12-31 | 145,775,000 | 10,477,000 | derived Q4 = FY annual - nine-month YTD | |
| 2025-Q1 | 2025-03-29 | 135,738,000 | 7,768,000 | 0.46 | reported discrete quarter |
| 2025-Q2 | 2025-03-29 | 7,768,000 | reported discrete quarter | ||
| 2025-Q2 | 2025-06-28 | 132,491,000 | -1.05 | reported discrete quarter | |
| 2025-Q3 | 2025-09-27 | 126,766,000 | 1,582,000 | 0.10 | reported discrete quarter |
| 2025-Q4 | 2025-12-31 | 151,062,000 | 3,485,000 | derived Q4 = FY annual - nine-month YTD | |
| 2026-Q1 | 2026-03-28 | 141,356,000 | 128,000 | 0.01 | reported discrete quarter |
Quarterly Charts
Macro Cross-References
- CPIAUCSL - Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
- UNRATE - Unemployment Rate
- FEDFUNDS - Federal Funds Effective Rate
- CES0500000003 - Average Hourly Earnings of All Employees, Total Private
- DFEDTARU - Federal Funds Target Range - Upper Limit
- DFEDTARL - Federal Funds Target Range - Lower Limit
- DGS3MO - Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity
- DGS2 - Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
- DGS10 - Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
- DGS30 - Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity
- T10Y2Y - 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
- CPILFESL - Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
- CPIUFDSL - Consumer Price Index for All Urban Consumers: Food
- CPIENGSL - Consumer Price Index for All Urban Consumers: Energy
- CUSR0000SAH1 - Consumer Price Index for All Urban Consumers: Shelter
- PCEPI - Personal Consumption Expenditures: Chain-type Price Index
- PCEPILFE - Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index
- PPIACO - Producer Price Index by Commodity: All Commodities
- T10YIE - 10-Year Breakeven Inflation Rate
- U6RATE - Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons
- PAYEMS - All Employees, Total Nonfarm
- CIVPART - Labor Force Participation Rate
- EMRATIO - Employment-Population Ratio
- UNEMPLOY - Unemployed
- CE16OV - Employment Level
- ICSA - Initial Claims
- JTSJOL - Job Openings: Total Nonfarm
- JTSQUR - Quits: Total Nonfarm
- GDPC1 - Real Gross Domestic Product
- A191RL1Q225SBEA - Real Gross Domestic Product: Percent Change from Preceding Period
- INDPRO - Industrial Production: Total Index
- TCU - Capacity Utilization: Total Index
- HOUST - New Privately-Owned Housing Units Started: Total Units
- PERMIT - New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
- RSAFS - Advance Retail Sales: Retail Trade
- PCE - Personal Consumption Expenditures
- DSPIC96 - Real Disposable Personal Income
- PSAVERT - Personal Saving Rate
- M2SL - M2
- BOPGSTB - U.S. International Trade in Goods and Services: Balance
- MSPUS - Median Sales Price of Houses Sold for the United States
- HSN1F - New One Family Houses Sold: United States
- RHORUSQ156N - Homeownership Rate in the United States
- TTLCONS - Total Construction Spending: Total Construction in the United States
- RRVRUSQ156N - Rental Vacancy Rate in the United States
- TOTALSL - Total Consumer Credit Owned and Securitized
- REVOLSL - Revolving Consumer Credit Owned and Securitized
- DRCCLACBS - Delinquency Rate on Credit Card Loans, All Commercial Banks
- GDP - Gross Domestic Product
- GPDI - Gross Private Domestic Investment
- GCE - Government Consumption Expenditures and Gross Investment
- PCEC - Personal Consumption Expenditures
- NETEXP - Net Exports of Goods and Services
- GFDEBTN - Federal Debt: Total Public Debt
- GFDEGDQ188S - Federal Debt: Total Public Debt as Percent of Gross Domestic Product
- FYFSD - Federal Surplus or Deficit
- FGRECPT - Federal Government Current Receipts
- FGEXPND - Federal Government: Current Expenditures
- MANEMP - All Employees, Manufacturing
- USCONS - All Employees, Construction
- USTRADE - All Employees, Retail Trade
- USFIRE - All Employees, Financial Activities
- USGOVT - All Employees, Government
- AWHAETP - Average Weekly Hours of All Employees, Total Private
- DGORDER - Manufacturers' New Orders: Durable Goods
- NEWORDER - Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft
- BUSINV - Total Business Inventories
- EXPGS - Exports of Goods and Services
- IMPGS - Imports of Goods and Services
- IR - Import Price Index (End Use): All Commodities
- PPIFIS - Producer Price Index by Commodity: Final Demand
Latest quarter (10-Q)
Latest 10-Q source: 0001174947-26-000554.
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Company Overview Sturm, Ruger & Company, Inc. (the “Company”) is principally engaged in the design, manufacture, and sale of firearms to domestic customers. Approximately 99% of sales are from firearms. Export sales accounted for approximately 5% of total sales for each of the three month periods ended March 28, 2026 and March 29, 2025. The Company’s design and manufacturing operations are located in the United States and almost all product content is domestic. The Company’s firearms are sold through a select number of independent wholesale distributors, principally to the commercial sporting market. The Company also manufactures investment castings made from steel alloys and metal injection molding (“MIM”) parts for internal use in its firearms and for sale to unaffiliated, third-party customers. Less than 1% of sales are from the castings segment. Orders for many models of firearms from the independent distributors tend to be stronger in the first quarter of the year and weaker in the third quarter of the year. This is due in part to the timing of the distributor show season, which occurs during the first quarter. Results of Operations During the three months ended March 28, 2026, the Company executed on its Ruger 2030 plan – strengthening operational responsiveness, enhancing the product portfolio and positioning the Company for sustainable long-term growth. Activity in the quarter included: · The Company’s Board of Directors advancing a deliberate and independent refreshment process, which saw the retirement of three existing directors and the addition of three new directors with relevant operational, industrial and strategic expertise while maintaining continuity during a period of leadership transition. · The appointment of a new CFO in April of 2026, along with other ongoing organizational realignment designed to improve efficiency and effectiveness. · The generation of $18.8 million in cash from operations, versus $11.1 million over the same period last year. · New product sales reaching $51.6 million, or 41%, of total firearm sales for the quarter. New product sales include only major new products that were introduced in the past two years and include the RXM pistol, Marlin 1894 lever-action rifles, American Centerfire Rifle Generation II, Glenfield rifles, Harrier rifles and the Ruger Red Label III Shotgun. · The increase of estimated sell-through of the Company’s products from the independent distributors to retailers by 3.2% from Q1 2025, exceeding a 1.6% increase in adjusted NICS during the same period. At the same time, compared to the first quarter of 2025, the Company’s finished goods inventories decreased 95,800 units while distributors’ inventories decreased 26,400 units, reflecting strong retail pull through of the Company’s new products. · The Hebron Facility is operating at target capacity, as of March 28, 2026. 22 As announced on May 4, 2026, Ruger and Beretta Holding entered an Agreement that reflects a shared commitment to long-term value creation, constructive engagement, and stability for Ruger’s shareholders, employees, customers and industry partners. Throughout that process, the Company took actions to protect the interests of all shareholders and to maintain focus on executing its long-term strategy. These efforts resulted in professional fees and advisory costs totaling $3.2 million during the quarter. These costs are largely non-recurring in nature and do not reflect the underlying performance of the core business. With the Agreement now in place, the Company expects these costs to be limited in duration, though some additional expenses may be incurred in the near term. Additionally, in February, the Company executed a reduction-in-force as part of broader efforts to structurally align the organization to strategic priorities and the future operating model. These actions are consistent with the changes outlined in the 2026 Plan and, more broadly, the Ruger 2030 framework. The moves improve efficiency, enhance accountability and position the Company for long-term profitable growth. The associated severance and related cost of $2.5 million were recognized in the quarter and are not indicative of ongoing operations. As a result of the factors listed above, the results of operations for the three month period ending March 28, 2026 were negatively impacted, on a non-GAAP basis, by $0.26 per share (see the Non-GAAP Financial Performance Measures below.) The impact was as follows: · Additional general and administrative expenses of $3.2 million, or $0.15 per share, related to the proxy contest with Beretta. · Increased general and administrative expenses of $2.5 million, or $0.11 per share, related to the leadership/governance transition and organizational realignment Demand The estimated unit sell-through of the Company’s products from the independent distributors to retailers increased 3% in the first three months of 2026 compared to the prior year period. For the same period, National Instant Criminal Background Check System (“NICS”) background checks (as adjusted by the National Shooting Sports Foundation (“NSSF”)) increased 2%. Estimated sell-through from the independent distributors to retailers and total adjusted NICS background checks for the trailing five quarters follow: 2026 2025 Q1 Q4 Q3 Q2 Q1 Estimated Units Sold from Distributors to Retailers (1) 376,400 473,800 370,600 328,500 364,700 Total adjusted NICS Background Checks (thousands) (2) 3,877 4,295 3,249 3,251 3,817 (1) The estimates for each period were calculated by taking the beginning inventory at the distributors, plus shipments from the Company to distributors during the period, less the ending inventory at distributors. These estimates are only a proxy for actual market demand as they: · Rely on data provided by independent distributors that are not verified by the Company, 23 · Do not consider potential timing issues within the distribution channel, including goods-in-transit, and · Do not consider fluctuations in inventory at retail. (2) NICS background checks are performed when the ownership of most firearms, either new or used, is transferred by a Federal Firearms Licensee. NICS background checks are also performed for permit applications, permit renewals, and other administrative reasons. The adjusted NICS data presented above was derived by the NSSF by subtracting out NICS checks that are not directly related to the sale of a firearm, including checks used for concealed carry (“CCW”) permit application checks, as well as checks on active CCW permit databases. The adjusted NICS checks represent less than half of the total NICS checks. Adjusted NICS data can be impacted by changes in state laws and regulations and any directives and interpretations issued by governmental agencies. Orders Received and Ending Backlog The Company uses the estimated unit sell-through of its products from the independent distributors to retailers, along with inventory levels at the independent distributors and at the Company, as the key metrics for planning production levels. The Company generally does not use the orders received or ending backlog for planning production levels. The units ordered, value of orders received, average sales price of units ordered, and ending backlog for the trailing five quarters are as follows (dollars in millions, except average sales price): (All amounts shown are net of Federal Excise Tax of 10% for handguns and 11% for long guns.) 2026 2025 Q1 Q4 Q3 Q2 Q1 Units Ordered 525,300 550,300 286,500 355,900 410,000 Orders Received $ 211.0 $ 160.2 $ 87.9 $ 113.7 $ 154.0 Average Sales Price of Units Ordered $ 402 $ 322 $ 307 $ 319 $ 376 Ending Backlog $ 329.7 $ 285.0 $ 227.0 $ 263.1 $ 275.2 Average Sales Price of Ending Unit Backlog $ 475 $ 524 $ 543 $ 534 $ 552 Production The Company reviews the estimated sell-through from the independent distributors to retailers, as well as inventory levels at the independent distributors and at the Company to plan production levels. The Company’s overall production in the first quarter of 2026 decreased 4% from the fourth quarter of 2025. 24 Summary Unit Data Firearms unit data for the trailing five quarters are as follows (dollar amounts shown are net of Federal Excise Tax of 10% for handguns and 11% for long guns): 2026 2025 Q1 Q4 Q3 Q2 Q1 Units Ordered 525,300 550,300 286,500 355,900 410,000 Units Produced 342,800 357,800 344,900 381,600 372,000 Units Shipped 375,600 424,400 361,600 361,400 356,700 Average Sales Price of Units Shipped $ 375 $ 355 $ 336 $ 349 $ 379 Ending Unit Backlog 693,600 543,900 418,000 493,100 498,600 Inventories During the first three months of 2026, the Company’s finished goods inventory decreased by 32,800 units and distributor inventories of the Company’s products decreased by 800 units. Inventory unit data for the trailing five quarters follows: 2026 2025 Q1 Q4 Q3 Q2 Q1 Company Inventory 34,700 67,500 134,100 150,700 130,500 Distributor Inventory (1) 161,500 162,300 211,700 220,700 187,900 Total Inventory (2) 196,200 229,800 345,800 371,400 318,400 (1) Distributor ending inventory is provided by the Company’s independent distributors. These numbers do not include goods-in-transit inventory that has been shipped from the Company but not yet received by the distributors. (2) This total does not include inventory at retailers. The Company does not have access to data on retailer inventories of the Company’s products. 25 Net Sales, Cost of Products Sold, and Gross Profit Net sales, cost of products sold, and gross profit data for the three months ended (dollars in millions): March 28, 2026 March 29, 2025 Change % Change Net firearms sales $ 140.9 $ 135.2 $ 5.7 4.2% Net castings sales 0.5 0.5 — (15.3% ) Total net sales 141.4 135.7 5.7 4.1% Cost of products sold 113.3 105.8 7.5 7.0% Gross profit $ 28.1 $ 29.9 $ (1.8 ) (7.3% ) Gross margin 19.9% 22.0% (2.1% ) (9.5% ) Total consolidated net sales and net firearms sales increased slightly for the three months ended March 28, 2026. Sales of new products, including the RXM pistol, Marlin 1894 lever-action rifles, American Centerfire Rifle Generation II, Glenfield rifles, Harrier rifles, and the Ruger Red Label III Shotgun represented $51.6 million or 41% of firearm sales in the three months ended March 28, 2026. New product sales include only major new products that were introduced in the past two years. The decreased gross profit for the three months ended March 28, 2026 is attributable to unfavorable leveraging of fixed costs resulting from decreased production, exacerbated by the $0.8 million of deferred revenue related to sales promotions. The decrease in gross margin for the three months ended March 28, 2026 is attributable to the aforementioned factors. Selling and General and Administrative Expenses Selling and general and administrative expenses data for the three months ended (dollars in millions): March 28, 2026 March 29, 2025 Change % Change Selling expenses $ 9.3 $ 9.4 $ (0.1 ) (0.6% ) General and administrative expenses 20.7 12.0 8.7 72.1% Total operating expenses $ 30.0 $ 21.4 $ 8.6 40.2% Selling expenses for the three months ended March 28, 2026 were substantially comparable to the corresponding period in the prior year. 26 The increase in general and administrative expenses for the three months ended March 28, 2026 was primarily attributable to $3.2 million in legal fees incurred related to the Beretta Strategic Cooperation Agreement, $2.5 million in severance costs, increased to share based compensation, which included a one-time non-recurring expense of $1.7 milli [Excerpt truncated for page length; source filing is linked above.]
Latest 10-K MD&A
ITEM 7—MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Company Overview Sturm, Ruger & Company, Inc. (the “Company”) is principally engaged in the design, manufacture, and sale of firearms to domestic customers. Approximately 99% of sales are from firearms. Export sales represent approximately 5% of total sales. The Company’s design and manufacturing operations are located in the United States and almost all product content is domestic. The Company’s firearms are sold through a select number of independent wholesale distributors, principally to the commercial sporting market. The Company also manufactures investment castings made from steel alloys and metal injection molding (“MIM”) parts for internal use in its firearms and for sale to unaffiliated, third-party customers. Less than 1% of sales are from the castings segment. Results of Operations - 2025 Product Demand The estimated sell-through of the Company’s products from the independent distributors to retailers in 2025 increased 5% from 2024. In 2025, adjusted NICS decreased 4% from 2024. The increase in the sell-through of the Company’s products despite the decrease in adjusted NICS background checks may be attributable to new product introductions, like the Ruger American Rifle Generation II bolt-action rifles, the Marlin lever-action rifles, Glenfield and Harrier rifles, and the RXM pistol, which helped offset aggressive promotions, discounts, rebates, and the extension of payment terms offered by the Company’s competitors. Estimated sell-through from distributors to retailers and total adjusted NICS background checks: 2025 2024 2023 Estimated Units Sold from Distributors to Retailers (1) 1,537,600 1,471,300 1,406,600 Total Adjusted NICS Background Checks (2) 14,612,300 15,239,000 15,848,000 (1) The estimates for each period were calculated by taking the beginning inventory at the distributors, plus shipments from the Company to distributors during the period, less the ending inventory at distributors. These estimates are only a proxy for actual market demand as they: · Rely on data provided by independent distributors that are not verified by the Company, · Do not consider potential timing issues within the distribution channel, including goods-in-transit, and · Do not consider fluctuations in inventory at retail. 25 (2) NICS background checks are performed when the ownership of most firearms, either new or used, is transferred by a Federal Firearms Licensee. NICS background checks are also performed for permit applications, permit renewals, and other administrative reasons. The adjusted NICS data presented above was derived by the NSSF by subtracting NICS checks that are not directly related to the sale of a firearm, including checks used for concealed carry (“CCW”) permit application checks as well as checks on active CCW permit databases. Adjusted NICS data can be impacted by changes in state laws and regulations and any directives and interpretations issued by governmental agencies. Orders Received and Ending Backlog The Company uses the estimated unit sell-through of its products from the independent distributors to retailers, along with inventory levels at the independent distributors and at the Company, as the key metrics for planning production levels. The units ordered, value of orders received and ending backlog, net of Federal Excise Tax, for the trailing three years are as follows (dollars in millions, except average sales price): 2025 2024 2023 Orders Received $ 515.8 $ 533.3 $ 433.8 Average Sales Price of Orders Received $ 322 $ 377 $ 374 Ending Backlog $ 285.0 $ 252.9 $ 229.0 Average Sales Price of Ending Backlog $ 524 $ 568 $ 522 Production The Company reviews the estimated sell-through from the independent distributors to retailers, as well as inventory levels at the independent distributors and at the Company, to plan production levels and manage inventories. These reviews resulted in an increase in total unit production of 6% in 2025 compared to 2024. 26 Annual Summary Unit Data Firearms unit data for orders, production, and shipments follows: 2025 2024 2023 Units Ordered 1,602,700 1,414,300 1,159,000 Units Produced 1,456,300 1,379,500 1,398,200 Units Shipped 1,504,000 1,407,800 1,367,500 Average Sales Price $ 364 $ 377 $ 395 Units – Backlog 543,900 445,300 438,800 Inventories The Company’s finished goods inventory decreased by 47,700 units during 2025, while distributor inventories of the Company’s products decreased by 33,500 units during the same period. Inventory data follows: 2025 2024 2023 Units – Company Inventory 67,500 115,200 143,500 Units – Distributor Inventory (3) 162,300 195,800 259,300 Total inventory (4) 229,800 311,000 402,800 (3) Distributor ending inventory as provided by the independent distributors of the Company’s products. These numbers do not include goods-in-transit inventory that has been shipped from the Company but not yet received by the distributors. (4) This total does not include inventory at retailers. The Company does not have access to data on retailer inventories. 27 Year ended December 31, 2025, as compared to year ended December 31, 2024: Net Sales, Cost of Products Sold, and Gross Profit Net sales, cost of products sold, and gross profit data for the year ended December 31, (dollars in millions): 2025 2024 Change % Change Net firearms sales $ 543.5 $ 532.6 $ 10.9 2.0 % Net casting sales 2.6 3.0 (0.4 ) (14.9 )% Total net sales 546.1 535.6 10.5 1.9 % Cost of products sold 464.9 421.2 43.7 10.4 % Gross profit $ 81.2 $ 114.4 $ (33.2 ) (29.1 )% Gross margin 14.9% 21.4% (6.5 )% (30.4 )% Firearms sales increased 2%, driven by a 7% increase in unit shipments, partially offset by the $5.7 million reduction related to the close out of 67,000 units of discontinued models in the second quarter of 2025. New products represented $169.5 million or 33% of firearms sales in 2025, an increase from $159.3 million or 32% of firearms sales in 2024. New product sales include only major new products that were introduced in the past two years. In 2025, new products included the RXM pistol, American Centerfire Rifle Generation II, Marlin 1894 lever-action rifles, Glenfield rifles, Harrier rifles, and the Ruger Red Label Shotgun, as well as the Super Wrangler revolver, which was only included for a portion of the year. The decreased gross profit for the year ended December 31, 2025 is attributable to inventory rationalization write-offs and the aforementioned sales reductions taken in the second quarter of 2025, $4.3 million of operating costs at the new Hebron facility that was acquired in July, increased costs associated with material and technology, a product mix shift toward products with relatively lower margins that remain in relatively stronger demand and increased sales promotional expenses, partially off-set by favorable deleveraging of fixed costs resulting from increased production. The decrease in gross margin for the year ended December 31, 2025 is attributable to the aforementioned factors. 28 Selling, General and Administrative Selling and general and administrative expenses data for the year ended December 31, (dollars in millions): 2025 2024 Change % Change Selling expenses $ 39.1 $ 38.8 $ 0.3 0.8% General and administrative expenses 54.2 44.0 10.2 23.2% Other operating expenses 0.2 — 0.2 100.0% Total operating expenses $ 93.5 $ 82.8 $ 10.7 12.9% Selling expenses for the year ended December 31, 2025 were substantially unchanged from 2024, as increases in promotional and marketing initiatives was largely offset by decreases in spending on industry shows, personnel costs, and shipping expenses. The increase in general and administrative expenses for the year ended December 31, 2025 was primarily attributable to expenses incurred due to the Company’s leadership transition and organizational realignment, as well as increased information technologies related expenses and professional fees associated with the purchase of the Anderson Manufacturing assets and the implementation of the Rights Plan. Operating (Loss) Income Operating loss was $12.3 million or 2.3% of sales in 2025. This is a decrease of $43.9 million from 2024 operating income of $31.6 million or 5.9% of sales. Other Operating Income (Expense), Net Other income data for the year ended December 31, (dollars in millions): 2025 2024 Change % Change Royalty income $ 1.4 $ 0.8 $ 0.6 63.5 % Interest income 3.2 4.9 (1.7 ) (33.3 )% Interest expense (0.1 ) (0.1 ) — (7.8 )% Other income, net 0.6 0.5 0.1 18.9 % Other income $ 5.1 $ 6.1 $ (1.0 ) (16.1 )% 29 The decrease in other income for the year ended December 31, 2025 was primarily the result of decreases in interest income due to decreased interest rates earned on short-term investments and other income, partially offset by increased royalty income. Income Taxes and Net Income The effective income tax rate was 38.7% in 2025 and 19.1% in 2024. The Company's 2025 and 2024 effective tax rates differ from the statutory federal tax rate due principally to research and development tax credits, state income taxes, and the nondeductibility of certain executive compensation. As a result of the foregoing factors, consolidated net loss was $4.4 million in 2025. This represents a decrease of $35.0 million from 2024 consolidated net income of $30.6 million. 30 Non-GAAP Financial Measure In an effort to provide investors with additional information regarding its results, the Company refers to various United States generally accepted accounting principles (“GAAP”) financial measures and two non-GAAP financial measures, EBITDA and EBITDA margin, which management believes provides useful information to investors. These non-GAAP measures may not be comparable to similarly titled measures being disclosed by other companies. In addition, the Company believes that the non-GAAP financial measures should be considered in addition to, and not in lieu of, GAAP financial measures. The Company believes that EBITDA and EBITDA margin are useful to understanding its operating results and the ongoing performance of its underlying business, as EBITDA provides information on the Company’s ability to meet its capital expenditure and working capital requirements, and is also an indicator of profitability. The Company believes that this reporting provides better transparency and comparability to its operating results. The Company uses both GAAP and non-GAAP financial measures to evaluate its financial performance. Non-GAAP Reconciliation – EBITDA EBITDA (Unaudited, dollars in thousands) Year ended December 31, 2025 2024 Net (loss) income $ (4,391 ) $ 30,563 Inventory rationalization 17,002 — Income tax (benefit) expense (2,770 ) 7,212 Depreciation and amortization expense 22,871 22,063 Interest expense 94 102 Interest income (3,259 ) (4,885 ) EBITDA $ 29,547 $ 55,055 EBITDA margin 5.4 % 10.3 % Net income margin (0.8 )% 5.7 % EBITDA is defined as earnings before interest, taxes, and depreciation and amortization. The Company calculates this by adding the amount of interest expense, income tax expense and depreciation and amortization expenses that have been deducted from net income back into net income, and subtracting the amount of interest income that was included in net income from net income to arrive at EBITDA. The Company’s EBITDA calculation also excludes certain non-recurring, non-cash, non-operating expenses. 31 Quarterly Data To supplement the summary annual unit data and discussion above, the same data for the last eight quarters follows: 2025 Q4 Q3 Q2 Q1 Units Ordered 550,300 286,500 355,900 410,000 Units Produced 357,800 344,900 381,600 372,000 Units Shipped 424,400 361,500 361,400 356,700 Estimated Units Sold from Distributors to Retailers 478,800 370,600 328,500 364,700 Total Adjusted NICS BackgroundChecks 4,294,600 3,249,000 3,251,000 3,817,000 Average Unit Sales Price $ 355 $ 336 $ 349 $ 379 Units – Backlog 543,900 418,000 493,100 498,600 Units – Company Inventory 67,500 134,100 150,700 130,500 Units – Distributor Inventory (5) 162,300 211,700 220,700 187,900 2024 Q4 Q3 Q2 Q1 Units Ordered 374,300 316,900 250,500 472,600 Units Produced 364,300 330,300 370,400 314,500 Units Shipped 398,700 327,400 336,300 345,400 Estimated Units Sold from Distributors to Retailers 410,500 336,300 327,800 396,700 Total Adjusted NICS BackgroundChecks 4,460,000 3,432,000 3,364,000 3,983,000 Average Unit Sales Price $ 364 $ 371 $ 386 $ 394 Units – Backlog 445,300 469,700 480,200 566,000 Units – Company Inventory 115,200 149,600 146,700 112,600 Units – Distributor Inventory (5) 195,800 207,600 216,500 208,000 (5) Distributor ending inventory as provided by the independent distributors of the Company’s products. 32 Orders Received and Ending Backlog (in millions except average sales price, net of Federal Excise Tax) 2025 Q4 Q3 Q2 Q1 Orders Received $ 160.2 $ 87.9 $ 113.7 $ 154.0 Average Sales Price of Orders Received $ 322 $ 307 $ 319 $ 376 Ending Backlog $ 285.0 $ 227.0 $ 263.1 $ 275.2 Average Sales Price of Ending Backlog $ 524 $ 543 $ 534 $ 552 2024 Q4 Q3 Q2 Q1 Orders Received $ 126.3 $ 109.4 $ 99.5 $ 198.2 Average Sales Price of Orders Received $ 337 $ 345 $ 397 $ 419 Ending Backlog $ 252.9 $ 268.7 $ 272.2 $ 296.2 Average Sales Price of Ending Backlog $ 568 $ 572 $ 567 $ 523 Fourth Quarter Net Sales and Gross Profit Analysis Net sales, cost of products sold, and gross profit data for the three months ended December 31, (dollars in millions): 2025 2024 Change % Change Net firearms sales $ 150.6 $ 145.3 $ 5.3 3.7 % Net casting sales 0.5 0.5 — (7.0 )% Total net sales 151.1 145.8 5.3 3.6 % Cost of products sold 124.1 112.6 11.5 10.2 % Gross profit $ 27.0 $ 33.2 $ (6.2 ) (18.8 )% Gross margin 17.8 % 22.8 % (5.0 )% (21.9 )% 33 Results of Operations - 2024 Year ended December 31, 2024, as compared to year ended December 31, 2023 Annual Summary Unit Data Firearms unit data for orders, production, shipments and ending inventory, and castings setups (a measure of foundry production) are as follows: 2024 2023 2022 Units Ordered 1,414,300 1,159,000 1,083,800 Units Produced 1,379,500 1,398,200 1,733,200 Units Shipped 1,407,800 1,367,500 1,641,000 Average Sales Price $ 377 $ 395 $ 362 Units – Backlog 445,300 438,800 647,300 Units – Company Inventory 115,200 143,500 112,800 Units – Distributor Inventory (1) 195,800 259,300 298,400 Orders Received and Ending Backlog (in millions except average sales price, net of Federal Excise Tax): 2024 2023 2022 Orders Received $ 533.3 $ 433.8 $ 451.2 Average Sales Price of Orders Received (2) $ 377 $ 374 $ 416 Ending Backlog $ 252.9 $ 229.0 $ 314.4 Average Sales Price of Ending Backlog (2) $ 568 $ 522 $ 486 (1) Distributor ending inventory as provided by the independent distributors of the Company’s products. (2) Average sales price for orders received and ending backlog is net of Federal Excise Tax of 10% for handguns and 11% for long guns. 34 Product Demand The estimated sell-through of the Company’s products from the independent distributors to retailers in 2024 increased 5% from 2023. In 2024, adjusted NICS decreased 4% from 2023. The increase in the sell-through of the Company’s products despite the decrease in adjusted NICS background checks may be attributable to new product introductions, like the Ruger American Rifle Generation II bolt-action rifles, the Marlin lever-action rifles, and the RXM pistol, which helped offset aggressive promotions, discounts, rebates, and the extension of payment terms offered by the Company’s competitors. Estimated sell-through from distributors to retailers and total adjusted NICS background checks: 2024 2023 2022 Estimated Units Sold from Distributors to Retailers (1) 1,471,300 1,406,600 1,506,800 Total Adjusted NICS Background Checks (2) 15,239,000 15,848,000 16,425,000 (1) The estimates for each period were calculated by taking the beginning inventory at the distributors, plus shipments from the Company to distributors during the period, less the ending inventory at distributors. These estimates are only a proxy for actual market demand as they: · Rely on data provided by independent distributors that are not verified by the Company, · Do not consider potential timing issues within the distribution channel, including goods-in-transit, and · Do not consider fluctuations in inventory at retail. (2) NICS background checks are performed when the ownership of most firearms, either new or used, is transferred by a Federal Firearms Licensee. NICS background checks are also performed for permit applications, permit renewals, and other administrative reasons. The adjusted NICS data presented above was derived by the NSSF by subtracting NICS checks that are not directly related to the sale of a firearm, including checks used for concealed carry (“CCW”) permit application checks as well as checks on active CCW permit databases. Adjusted NICS data can be impacted by changes in state laws and regulations and any directives and interpretations issued by governmental agencies. 35 Production The Company reviews the estimated sell-through from the independent distributors to retailers, as well as inventory levels at the independent distributors and at the Company, to plan production levels and manage inventories. These reviews resulted in a decrease in total unit production of 1% in 2024 compared to 2023. Inventories The Company’s finished goods inventory decreased by 28,300 units during 2024, while distributor inventories of the Company’s products decreased by 63,500 units during the same period. Inventory data follows: 2024 2023 2022 Units – Company Inventory 115,200 143,500 112,800 Units – Distributor Inventory (3) 195,800 259,300 298,400 Total inventory (4) 311,000 402,800 411,200 (3) Distributor ending inventory as provided by the independent distributors of the Company’s products. These numbers do not include goods-in-transit inventory that has been shipped from the Company but not yet received by the distributors. (4) This total does not include inventory at retailers. The Company does not have access to data on retailer inventories. 36 Quarterly Data To supplement the summary annual unit data and discussion above, the same data for the last eight quarters follows: 2024 Q4 Q3 Q2 Q1 Units Ordered 374,300 316,900 250,500 472,600 Units Produced 364,300 330,300 370,400 314,500 Units Shipped 398,700 327,400 336,300 345,400 Estimated Units Sold from Distributors to Retailers 410,500 336,300 327,800 396,700 Total Adjusted NICS Background Checks 4,460,000 3,432,000 3,364,000 3,983,000 Average Unit Sales Price $ 364 $ 371 $ 386 $ 394 Units – Backlog 445,300 469,700 480,200 566,000 Units – Company Inventory 115,200 149,600 146,700 112,600 Units – Distributor Inventory (5) 195,800 207,600 216,500 208,000 2023 Q4 Q3 Q2 Q1 Units Ordered 316,600 176,300 258,100 408,000 Units Produced 305,200 324,500 387,500 381,000 Units Shipped 337,800 308,400 336,400 384,900 Estimated Units Sold from Distributors to Retailers 384,700 307,400 323,000 391,500 Total Adjusted NICS Background Checks 4,742,000 3,284,000 3,654,000 4,168,000 Average Unit Sales Price $ 383 $ 390 $ 422 $ 387 Units – Backlog 438,800 460,000 592,100 670,400 Units – Company Inventory 143,500 176,100 160,000 108,900 Units – Distributor Inventory (5) 259,300 306,200 305,200 291,800 (5) Distributor ending inventory as provided by the independent distributors of the Company’s products. 37 Orders Received and Ending Backlog (in millions except average sales price, net of Federal Excise Tax) 2024 Q4 Q3 Q2 Q1 Orders Received $ 126.3 $ 109.4 $ 99.5 $ 198.2 Average Sales Price of Orders Received $ 337 $ 345 $ 397 $ 419 Ending Backlog $ 252.9 $ 268.7 $ 272.2 $ 296.2 Average Sales Price of Ending Backlog $ 568 $ 572 $ 567 $ 523 2023 Q4 Q3 Q2 Q1 Orders Received $ 116.7 $ 58.8 $ 102.1 $ 156.2 Average Sales Price of Orders Received $ 369 $ 334 $ 396 $ 383 Ending Backlog $ 229.0 $ 234.8 $ 293.7 $ 327.3 Average Sales Price of Ending Backlog $ 522 $ 510 $ 496 $ 488 Net Sales, Cost of Products Sold, and Gross Profit Net sales, cost of products sold, and gross profit data for the year ended December 31, (dollars in millions): 2024 2023 Change % Change Net firearms sales $ 532.6 $ 540.7 $ (8.1 ) (1.5 )% Net casting sales 3.0 3.0 0.0 0.5 % Total net sales 535.6 543.7 (8.1 ) (1.5 )% Cost of products sold 421.2 410.1 11.1 2.7 % Gross profit $ 114.4 $ 133.6 $ (19.2 ) (14.4 )% Gross margin 21.4 % 24.6 % (3.2 )% (13.0 )% Firearms sales decreased 2% and unit shipments increased 3%, respectively, in 2024. New products represented $159.3 million or 32% of firearms sales in 2024, an increase from $119.0 38 million or 23% of firearms sales in 2023. New product sales include only major new products that were introduced in the past two years. In 2024, new products included the RXM pistol, American Centerfire Rifle Generation II, Marlin 1894 lever-action rifles, Security-380 pistol, Super Wrangler revolver, LC Carbine, and the Small-Frame Autoloading Rifle and the Marlin 1895 Marlin lever-action rifles, which were only included for a portion of the year. The decreased gross profit for the year ended December 31, 2024 is attributable to the decrease in sales, unfavorable deleveraging of fixed costs resulting from decreased production, and a product mix shift toward products with relatively lower margins that remain in stronger demand. The decrease in gross margin for the year ended December 31, 2024 is attributable to the aforementioned factors, partially offset by increased pricing. Selling, General and Administrative Selling and general and administrative expenses data for the year ended December 31, (dollars in millions): 2024 2023 Change % Change Selling expenses $ 38.8 $ 38.8 $ — (0.1 %) General and administrative expenses 44.0 42.7 1.3 3.0 % Total operating expenses $ 82.8 $ 81.5 $ 1.3 1.5 % Selling expenses for the year ended December 31, 2024 were substantially unchanged from 2023, as increased spending on advertising was offset by modest reductions in several selling and marketing initiatives. The increase in general, and administrative expenses for the year ended December 31, 2024 was primarily attributable to increased professional service costs and accrued severances of $1.5 million taken in the first quarter of 2024 related to a reduction in force involving approximately 80 employees. These increases were partially offset by a reduction in incentive compensation expenses. The aforementioned accrued severances were settled in cash and consist of one-time termination charges arising from severance obligations and other customary employee benefit payments in connection with a reduction in force. Operating Income Operating income was $31.6 million or 5.9% of sales in 2024. This is a decrease of $20.4 million from 2023 operating income of $52.1 million or 9.6% of sales. 39 Other Operating Income (Expense), Net Other income data for the year ended December 31, (dollars in millions): 2024 2023 Change % Change Royalty income $ 0.8 $ 0.6 $ 0.2 30.2 % Interest income 4.9 5.5 (0.6 ) (10.6 %) Interest expense (0.1 ) (0.2 ) 0.1 (50.2 %) Other income, net 0.5 0.8 (0.3 ) (41.5 %) Other income $ 6.1 $ 6.7 $ (0.6 ) (10.0 %) The decrease in other income for the year ended December 31, 2024 was primarily the result of decreases in interest income due to decreased interest rates earned on short-term investments and other income, partially offset by increased royalty income. Income Taxes and Net Income The effective income tax rate was 19.1% in 2024 and 18.0% in 2023. The Company's 2024 and 2023 effective tax rates differ from the statutory federal tax rate due principally to research and development tax credits, state income taxes, and the nondeductibility of certain executive compensation. As a result of the foregoing factors, consolidated net income was $30.6 million in 2024. This represents a decrease of $17.6 million from 2023 consolidated net income of $48.2 million. 40 Non-GAAP Financial Measure In an effort to provide investors with additional information regarding its results, the Company refers to various United States generally accepted accounting principles (“GAAP”) financial measures and two non-GAAP financial measures, EBITDA and EBITDA margin, which management believes provides useful information to investors. These non-GAAP measures may not be comparable to similarly titled measures being disclosed by other companies. In addition, the Company believes that the non-GAAP financial measures should be considered in addition to, and not in lieu of, GAAP financial measures. The Company believes that EBITDA and EBITDA margin are useful to understanding its operating results and the ongoing performance of its underlying business, as EBITDA provides information on the Company’s ability to meet its capital expenditure and working capital requirements, and is also an indicator of profitability. The Company believes that this reporting provides better transparency and comparability to its operating results. The Company uses both GAAP and non-GAAP financial measures to evaluate its financial performance. Non-GAAP Reconciliation – EBITDA EBITDA (Unaudited, dollars in thousands) Year ended December 31, 2024 2023 Net income $ 30,563 $ 48,215 Income tax expense 7,212 10,609 Depreciation and amortization expense 22,063 22,383 Interest expense 102 205 Interest income (4,885 ) (5,465 ) EBITDA $ 55,055 $ 75,947 EBITDA margin 10.3% 14.0% Net income margin 5.7% 8.9% EBITDA is defined as earnings before interest, taxes, and depreciation and amortization. The Company calculates this by adding the amount of interest expense, income tax expense and depreciation and amortization expenses that have been deducted from net income back into net income, and subtracting the amount of interest income that was included in net income from net income to arrive at EBITDA. The Company’s EBITDA calculation also excludes certain non-recurring, non-cash, non-operating expenses. 41 Financial Condition Liquidity At December 31, 2025, the Company had cash and cash equivalents of $18.5 million and $74.1 million in short term investments. The Company’s pre-LIFO working capital of $223.9 million, less the LIFO reserve of $67.1 million, resulted in working capital of $156.9 million and a current ratio of 3.9 to 1. The Company also has access to a $40 million unsecured revolving line of credit that is currently undrawn. Capital Resources The Company believes that its cash flow from operations, current cash position, and access to capital markets will continue to be sufficient to meet its anticipated cash requirements and contractual obligations, which includes funding the Company’s capital expenditures, acquisitions, dividend payments, and share repurchases. Operations Cash provided by operating activities was $54.3 million, $55.5 million, and $33.9 million in 2025, 2024, and 2023, respectively. The slight decrease in cash provided in 2025 compared to 2024 is primarily attributable to the decrease in net income, mostly offset by the reduction in inventory in excess of the increase in inventory reserves related to the Company’s inventory rationalization in 2025. The decrease in cash provided in 2024 compared to 2023 is primarily attributable to the decrease in net income in 2024. Third parties supply the Company with various raw materials for its firearms and castings, such as fabricated steel components, walnut, birch, beech, maple and laminated lumber for rifle stocks, wax, ceramic material, metal alloys, various synthetic products and other component parts. There is a limited supply of these materials in the marketplace at any given time, which can cause the purchase prices to vary based upon numerous market factors. If market conditions result in a significant prolonged inflation of certain prices or if adequate quantities of raw materials cannot be obtained, the Company’s manufacturing processes could be interrupted and the Company’s financial condition or results of operations could be materially adversely affected. Investing and Financing Capital expenditures were $30.9 million, $20.8 million, and $15.8 million in 2025, 2024, and 2023, respectively. In 2026, the Company expects capital expenditures to approximate $30 million, much of which will relate to tooling and fixtures for new product introductions and to upgrade and modernize manufacturing equipment. Due to market conditions and business circumstances, actual capital expenditures could vary significantly from the budgeted amount. The Company finances, and intends to continue to finance, all of these activities with funds provided by operations and current cash. 42 Included in capital expenditures amount noted above, on July 1, 2025 the Company completed the asset purchase of Anderson Manufacturing, a manufacturer of firearms and firearm accessories based in Hebron, Kentucky for a total purchase price of $15.8 million, $15 million of which was paid at the closing of such transaction. This strategic purchase included Anderson’s manufacturing facility and machinery and provided Ruger the opportunity to work with a skilled and experienced workforce, strengthening its production capabilities and expanding its product offerings. As of December 31, 2025, the Company had $39.4 million of United States Treasury instruments which mature within one year. The Company also invests available cash in a bank-managed money market fund that invests exclusively in United States Treasury instruments which mature within one year. At December 31, 2025, the Company’s investment in this money market fund totaled $34.7 million. In 2025, the Company repurchased 732,765 shares of its common stock for $26.1 million in the open market. The average price per share purchased was $35.60. These purchases were funded with cash on hand. In 2024, the Company repurchased 835,060 shares of its common stock for $34.4 million in the open market. The average price per share purchased was $41.19. These purchases were funded with cash on hand. In 2023, the Company repurchased 264,062 shares of its common stock for $11.8 million in the open market. The average price per share purchased was $44.71. These purchases were funded with cash on hand. At December 31, 2025, approximately $14.3 million remained authorized for future share repurchases. On January 5, 2023, the Company paid a $5.00 per share special dividend to shareholders of record on December 15, 2022. Including the $5.00 per share special dividend paid on January 5, 2023, the Company paid dividends totaling $10.1 million, $11.8 million, and $110.8 million in 2025, 2024, and 2023, respectively. The quarterly dividend varies every quarter because the Company pays a percentage of earnings rather than a fixed amount per share. The Company’s practice is to pay a dividend of approximately 40% of net income. On March 2, 2026, the Company’s Board of Directors authorized a dividend of 8¢ per share to shareholders of record on March 16, 2026. The payment of future dividends depends on many factors, including internal estimates of future performance, then-current cash, and the Company’s need for funds. The Company provides supplemental discretionary contributions to substantially all employees’ individual 401(k) accounts. 43 Based on its unencumbered assets, the Company believes it has the ability to raise cash through issuance of short-term or long-term debt. Contractual Obligations At December 31, 2025, the Company had approximately $31.7 million in agreements to purchase goods or services that are enforceable and legally binding on the Company, all of which are expected to be settled in less than one year. Additionally, the Company has approximately $1.8 million in operating lease obligations, which will be payable through 2034. The Company expects to fund all of these commitments with cash flows from operations and current cash. Firearms Legislation and Litigation See Item 1A - Risk Factors and Note 20 to the financial statements which are included in the Annual Report on Form 10-K for a discussion of firearms legislation and litigation. Other Operational Matters In the normal course of its manufacturing operations, the Company is subject to occasional governmental proceedings and orders pertaining to workplace safety, firearms serial number tracking and control, waste disposal, air emissions and water discharges into the environment. The Company believes that it is generally in compliance with applicable Bureau of Alcohol, Tobacco, Firearms & Explosives, environmental, and safety regulations and the outcome of any proceedings or orders will not have a material adverse effect on the financial position or results of operations of the Company. If these regulations become more stringent in the future and we are not able to comply with them, such noncompliance could have a material adverse impact on the Company. Currently, there are 13 domestic distributors. Additionally, the Company has 44 and 26 distributors servicing the export and law enforcement markets, respectively. The Company self-insures a significant amount of its product liability, workers’ compensation, medical, and other insurance. It also carries significant deductible amounts on various insurance policies. The Company expects to realize its deferred tax assets through tax deductions against future taxable income. On October 14, 2025, the Company’s Board of Directors (the “Board”) approved the adoption of a limited-duration stockholder rights plan (the “Rights Plan”). The Rights Plan is effective October 14, 2025 (“Effective Date”) and will expire on October 13, 2026. The Board, in consultation with its advisors, adopted the Rights Plan in response to the public announcement by Beretta Holding S.A. (“Beretta”) that it had accumulated a significant economic interest in Ruger’s common stock and intends to engage in discussions with the Company regarding “potential areas of operational and strategic collaborations”. The Rights Plan is intended to ensure that the Board remains in the best position to perform its fiduciary duties and to enable all stockholders to receive fair and equal treatment. It is also designed to allow all stockholders to realize the long-term value of their investment by reducing the likelihood that Beretta would gain control through open market 44 accumulation or other coercive tactics without appropriately compensating the Company’s stockholders or allowing the Board sufficient time to make informed judgments. The Rights Plan is a temporary measure to give the Board time to understand Beretta’s intentions and evaluate options. The summary of the terms of the Rights Plan set forth in Note 22 is hereby incorporated by reference herein; provided, however, that such summary of the Rights Plan is qualified in its entirety by the Rights Plan. Critical Accounting Policies and Estimates The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires management to make assumptions and estimates that affect the reported amounts of assets and liabilities as of the balance sheet date and net sales and expenses recognized and incurred during the reporting period then ended. The Company bases estimates on prior experience, facts and circumstances, and other assumptions, including those reviewed with actuarial consultants and independent counsel, when applicable, that are believed to be reasonable. However, actual results may differ from these estimates. The Company believes that the assumptions and judgments involved in the accounting estimates below have the greatest potential impact on its financial statements, so the Company believes these to be its critical accounting estimates. The methodologies applied for determining the estimates related to the below critical accounting estimates have not changed from the prior year. Product Liability Accrual The Company believes the determination of its product liability accrual is a critical accounting policy. The Company’s management reviews every lawsuit and claim and is in contact with independent and corporate counsel on an ongoing basis. The provision for product liability claims is based upon many factors, which vary for each case. These factors include the type of claim, nature and extent of injuries, historical settlement ranges, jurisdiction where filed, and advice of counsel. An accrual is established for each lawsuit and claim, when appropriate, based on the nature of each such lawsuit or claim. Amounts are charged to product liability expense in the period in which the Company becomes aware that a claim or, in some instances a threat of a claim, has been made when potential losses or costs of defense are probable and can be reasonably estimated. Such amounts are determined based on the Company’s experience in defending similar claims. Occasionally, charges are made for claims made in prior periods because the cumulative actual costs incurred for that claim, or reasonably expected to be incurred in the future, exceed amounts already provided with respect to such claims. Likewise, credits may be taken if cumulative actual costs incurred for that claim, or reasonably expected to be incurred in the future, are less than amounts previously provided. While it is not possible to forecast the outcome of litigation or the timing of related costs, in the opinion of management, after consultation with independent and corporate counsel, there is a remote likelihood that litigation, including punitive damage claims, will have a material adverse effect on the financial position of the Company, but such litigation may have a material impact on the Company’s financial results and cash flows for a particular period. 45 Inventory Valuation and Reserves The Company believes the valuation of its inventory and the related excess and obsolescence reserve is also a critical accounting policy. Inventories are carried at the lower of cost, principally determined by the last-in, first-out (LIFO) method, or market. An actual valuation of inventory under the LIFO method is made at the end of each year based on the inventory levels and the Company’s estimates of the prevailing costs of the many components of inventory existing at that time. The Company determines its excess and obsolescence reserve by projecting the year in which inventory will be consumed into a finished product. Given ever-changing market conditions, customer preferences and the anticipated introduction of new products, projecting the future usage of inventory is subjective. As such, it does not seem prudent to carry inventory at full cost beyond what the Company projects to be needed during the next 36 months. Recent Accounting Pronouncements In December of 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures.” The updated accounting guidance requires expanded income tax disclosures, including the disaggregation of existing disclosures related to the effective tax rate reconciliation and income taxes paid. The guidance is effective for fiscal years beginning after December 15, 2024. Prospective application is required, with retrospective application permitted. Refer to Note 13, Income Taxes, for the updated presentation. In November 2024, the FASB issued ASU No. 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures,” which requires additional disclosure of certain costs and expenses within the notes to the financial statements. The updated standard is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods within annual reporting periods beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application. Early adoption is permitted. The Company is currently evaluating the effect the updated guidance will have on its financial statement disclosures. In December 2025, the FASB issued its final ASU which makes improvements to the Accounting Standards Codification in response to feedback from stakeholders. This standard, issued as ASU 2025-12, specifically updates the Codification for a broad range of Topics arising from technical corrections, unintended application of the Codification, clarifications, and other minor improvements. This update is effective for annual reporting periods beginning after December 15, 2026, including interim reporting periods within those annual reporting periods. The Company is currently evaluating the impact of adopting ASU 2025-12. In September 2025, the FASB issued ASU No. 2025-06, “Intangibles - Goodwill and Other - Internal Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal Use Software.” The standard modernizes and simplifies guidance for internal-use software costs. This guidance is effective for annual reporting periods beginning after December 15, 2027 46 including interim reporting periods within those annual reporting periods. The Company is evaluating the impact of this guidance on its Consolidated Financial Statements. Forward-Looking Statements and Projections The Company may, from time to time, make forward-looking statements and projections concerning future expectations. Such statements are based on current expectations and are subject to certain qualifying risks and uncertainties, such as market demand, sales levels of firearms, anticipated castings sales and earnings, the need for external financing for operations or capital expenditures, the results of pending litigation against the Company, the impact of future firearms control and environmental legislation and accounting estimates, any one or more of which could cause actual results to differ materially from those projected. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “will,” “should,” “could” and other words and terms of similar meaning, typically identify such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date made. The Company undertakes no obligation to publish revised forward-looking statements to reflect events or circumstances after the date such forward-looking statements are made or to reflect the occurrence of subsequent unanticipated events.