# SMITH & WESSON BRANDS, INC. (SWBI)

Informational only - not investment advice.

CIK: 0001092796
SIC: 3480 Ordnance & Accessories, (No Vehicles/Guided Missiles)
SIC breadcrumb: [Manufacturing](/division/D/) > [SIC Major Group 34](/major-group/34/) > [SIC 3480 Ordnance & Accessories, (No Vehicles/Guided Missiles)](/industry/3480/)
Latest 10-K filed: 2026-06-17
SEC page: https://www.sec.gov/edgar/browse/?CIK=1092796
Filing source: https://www.sec.gov/Archives/edgar/data/1092796/000119312526274254/swbi-20260430.htm

## Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
| --- | ---: | --- | ---: | --- |
| Revenue | 523845000 | USD | 2026 | 2026-06-17 |
| Net income | 18481000 | USD | 2026 | 2026-06-17 |
| Assets | 512766000 | USD | 2026 | 2026-06-17 |

## Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-06-17. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001092796.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

| Metric | 2014 | 2015 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | 2026 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Revenue |  |  | 903,188,000 | 606,850,000 | 481,336,000 | 529,618,000 | 1,059,195,000 | 864,126,000 | 479,242,000 | 535,833,000 | 474,661,000 | 523,845,000 |
| Net income |  |  | 127,854,000 | 20,128,000 | 18,410,000 | -61,230,000 | 252,049,000 | 194,494,000 | 36,876,000 | 41,363,000 | 13,425,000 | 18,481,000 |
| Operating income |  |  | 199,939,000 | 27,048,000 | 43,517,000 | 50,305,000 | 319,632,000 | 251,653,000 | 48,407,000 | 47,102,000 | 23,884,000 | 29,211,000 |
| Gross profit |  |  | 375,272,000 | 195,752,000 | 146,284,000 | 165,689,000 | 448,983,000 | 374,564,000 | 154,537,000 | 158,093,000 | 127,183,000 | 141,103,000 |
| Diluted EPS |  |  | 2.25 | 0.37 | 0.33 | -1.10 | 4.55 | 4.08 | 0.80 | 0.89 | 0.30 | 0.41 |
| Operating cash flow |  |  | 123,576,000 | 61,643,000 | 57,099,000 | 94,736,000 | 315,334,000 | 137,814,000 | 16,732,000 | 106,739,000 | -7,223,000 | 114,195,000 |
| Capital expenditures |  |  | 34,876,000 | 18,490,000 | 30,895,000 | 12,441,000 | 22,052,000 | 23,972,000 | 89,565,000 | 90,759,000 | 21,605,000 | 23,748,000 |
| Dividends paid |  |  |  |  |  | 0.00 | 8,223,000 | 15,035,000 | 18,333,000 | 22,020,000 | 23,096,000 | 23,229,000 |
| Share buybacks | 115,887,000 | 30,040,000 | 50,052,000 |  |  | 0.00 | 110,000,000 | 90,000,000 | 0.00 | 10,213,000 | 25,468,000 | 0.00 |
| Assets |  |  | 788,036,000 | 745,060,000 | 766,789,000 | 729,515,000 | 446,388,000 | 497,476,000 | 541,294,000 | 577,428,000 | 559,612,000 | 512,766,000 |
| Liabilities |  |  | 394,874,000 | 322,912,000 | 322,345,000 | 342,397,000 | 180,004,000 | 136,962,000 | 156,671,000 | 177,514,000 | 187,158,000 | 136,207,000 |
| Stockholders' equity |  |  | 393,162,000 | 422,148,000 | 444,444,000 | 387,118,000 | 266,384,000 | 360,514,000 | 384,623,000 | 399,914,000 | 372,454,000 | 376,559,000 |
| Cash and cash equivalents |  |  | 61,549,000 | 48,860,000 | 41,015,000 | 125,011,000 | 113,017,000 | 120,728,000 | 53,556,000 | 60,839,000 | 25,231,000 | 28,190,000 |
| Free cash flow |  |  | 88,700,000 | 43,153,000 | 26,204,000 | 82,295,000 | 293,282,000 | 113,842,000 | -72,833,000 | 15,980,000 | -28,828,000 | 90,447,000 |

### Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

| Metric | 2014 | 2015 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | 2026 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Net margin |  |  | 14.16% | 3.32% | 3.82% | -11.56% | 23.80% | 22.51% | 7.69% | 7.72% | 2.83% | 3.53% |
| Operating margin |  |  | 22.14% | 4.46% | 9.04% | 9.50% | 30.18% | 29.12% | 10.10% | 8.79% | 5.03% | 5.58% |
| Return on equity |  |  | 32.52% | 4.77% | 4.14% | -15.82% | 94.62% | 53.95% | 9.59% | 10.34% | 3.60% | 4.91% |
| Return on assets |  |  | 16.22% | 2.70% | 2.40% | -8.39% | 56.46% | 39.10% | 6.81% | 7.16% | 2.40% | 3.60% |
| Liabilities / equity |  |  | 1.00 | 0.76 | 0.73 | 0.88 | 0.68 | 0.38 | 0.41 | 0.44 | 0.50 | 0.36 |
| Current ratio |  |  | 2.11 | 2.69 | 2.68 | 3.03 | 2.13 | 3.68 | 3.35 | 3.04 | 4.16 | 3.20 |

## Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-06-17. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001092796.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

| Quarter | End date | Revenue | Net income | Diluted EPS | Method |
| --- | --- | ---: | ---: | ---: | --- |
| 2021-Q2 | 2021-10-31 |  |  | 1.05 | reported discrete quarter |
| 2022-Q3 | 2022-01-31 |  |  | 0.65 | reported discrete quarter |
| 2022-Q1 | 2022-07-31 |  |  | 0.07 | reported discrete quarter |
| 2022-Q2 | 2022-10-31 |  |  | 0.21 | reported discrete quarter |
| 2023-Q3 | 2023-01-31 | 129,036,000 | 11,079,000 | 0.24 | reported discrete quarter |
| 2023-Q4 | 2023-04-30 | 144,777,000 | 12,837,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2024-Q3 | 2024-01-31 | 137,484,000 | 7,882,000 | 0.17 | reported discrete quarter |
| 2024-Q4 | 2024-04-30 | 159,147,000 | 26,110,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2024-Q1 | 2024-07-31 | 88,334,000 | -2,106,000 | -0.05 | reported discrete quarter |
| 2024-Q2 | 2024-10-31 | 129,679,000 | 4,134,000 | 0.09 | reported discrete quarter |
| 2025-Q3 | 2025-01-31 | 115,885,000 | 1,663,000 | 0.04 | reported discrete quarter |
| 2025-Q4 | 2025-04-30 | 140,762,000 | 9,735,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2025-Q1 | 2025-07-31 | 85,077,000 | -3,411,000 | -0.08 | reported discrete quarter |
| 2026-Q2 | 2025-10-31 | 124,670,000 | 1,917,000 | 0.04 | reported discrete quarter |
| 2026-Q3 | 2026-01-31 | 135,709,000 | 3,753,000 | 0.08 | reported discrete quarter |
| 2026-Q4 | 2026-04-30 | 178,388,000 | 16,222,000 |  | derived Q4 = FY annual - nine-month YTD |

## Macro Cross-References
- [CPIAUCSL](/indicator/CPIAUCSL/): Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
- [UNRATE](/indicator/UNRATE/): Unemployment Rate
- [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate
- [CES0500000003](/indicator/CES0500000003/): Average Hourly Earnings of All Employees, Total Private
- [DFEDTARU](/indicator/DFEDTARU/): Federal Funds Target Range - Upper Limit
- [DFEDTARL](/indicator/DFEDTARL/): Federal Funds Target Range - Lower Limit
- [DGS3MO](/indicator/DGS3MO/): Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity
- [DGS2](/indicator/DGS2/): Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
- [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
- [DGS30](/indicator/DGS30/): Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity
- [T10Y2Y](/indicator/T10Y2Y/): 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
- [CPILFESL](/indicator/CPILFESL/): Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
- [CPIUFDSL](/indicator/CPIUFDSL/): Consumer Price Index for All Urban Consumers: Food
- [CPIENGSL](/indicator/CPIENGSL/): Consumer Price Index for All Urban Consumers: Energy
- [CUSR0000SAH1](/indicator/CUSR0000SAH1/): Consumer Price Index for All Urban Consumers: Shelter
- [PCEPI](/indicator/PCEPI/): Personal Consumption Expenditures: Chain-type Price Index
- [PCEPILFE](/indicator/PCEPILFE/): Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index
- [PPIACO](/indicator/PPIACO/): Producer Price Index by Commodity: All Commodities
- [T10YIE](/indicator/T10YIE/): 10-Year Breakeven Inflation Rate
- [U6RATE](/indicator/U6RATE/): Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons
- [PAYEMS](/indicator/PAYEMS/): All Employees, Total Nonfarm
- [CIVPART](/indicator/CIVPART/): Labor Force Participation Rate
- [EMRATIO](/indicator/EMRATIO/): Employment-Population Ratio
- [UNEMPLOY](/indicator/UNEMPLOY/): Unemployed
- [CE16OV](/indicator/CE16OV/): Employment Level
- [ICSA](/indicator/ICSA/): Initial Claims
- [JTSJOL](/indicator/JTSJOL/): Job Openings: Total Nonfarm
- [JTSQUR](/indicator/JTSQUR/): Quits: Total Nonfarm
- [GDPC1](/indicator/GDPC1/): Real Gross Domestic Product
- [A191RL1Q225SBEA](/indicator/A191RL1Q225SBEA/): Real Gross Domestic Product: Percent Change from Preceding Period
- [INDPRO](/indicator/INDPRO/): Industrial Production: Total Index
- [TCU](/indicator/TCU/): Capacity Utilization: Total Index
- [HOUST](/indicator/HOUST/): New Privately-Owned Housing Units Started: Total Units
- [PERMIT](/indicator/PERMIT/): New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
- [RSAFS](/indicator/RSAFS/): Advance Retail Sales: Retail Trade
- [PCE](/indicator/PCE/): Personal Consumption Expenditures
- [DSPIC96](/indicator/DSPIC96/): Real Disposable Personal Income
- [PSAVERT](/indicator/PSAVERT/): Personal Saving Rate
- [M2SL](/indicator/M2SL/): M2
- [BOPGSTB](/indicator/BOPGSTB/): U.S. International Trade in Goods and Services: Balance
- [MSPUS](/indicator/MSPUS/): Median Sales Price of Houses Sold for the United States
- [HSN1F](/indicator/HSN1F/): New One Family Houses Sold: United States
- [RHORUSQ156N](/indicator/RHORUSQ156N/): Homeownership Rate in the United States
- [TTLCONS](/indicator/TTLCONS/): Total Construction Spending: Total Construction in the United States
- [RRVRUSQ156N](/indicator/RRVRUSQ156N/): Rental Vacancy Rate in the United States
- [TOTALSL](/indicator/TOTALSL/): Total Consumer Credit Owned and Securitized
- [REVOLSL](/indicator/REVOLSL/): Revolving Consumer Credit Owned and Securitized
- [DRCCLACBS](/indicator/DRCCLACBS/): Delinquency Rate on Credit Card Loans, All Commercial Banks
- [GDP](/indicator/GDP/): Gross Domestic Product
- [GPDI](/indicator/GPDI/): Gross Private Domestic Investment
- [GCE](/indicator/GCE/): Government Consumption Expenditures and Gross Investment
- [PCEC](/indicator/PCEC/): Personal Consumption Expenditures
- [NETEXP](/indicator/NETEXP/): Net Exports of Goods and Services
- [GFDEBTN](/indicator/GFDEBTN/): Federal Debt: Total Public Debt
- [GFDEGDQ188S](/indicator/GFDEGDQ188S/): Federal Debt: Total Public Debt as Percent of Gross Domestic Product
- [FYFSD](/indicator/FYFSD/): Federal Surplus or Deficit
- [FGRECPT](/indicator/FGRECPT/): Federal Government Current Receipts
- [FGEXPND](/indicator/FGEXPND/): Federal Government: Current Expenditures
- [MANEMP](/indicator/MANEMP/): All Employees, Manufacturing
- [USCONS](/indicator/USCONS/): All Employees, Construction
- [USTRADE](/indicator/USTRADE/): All Employees, Retail Trade
- [USFIRE](/indicator/USFIRE/): All Employees, Financial Activities
- [USGOVT](/indicator/USGOVT/): All Employees, Government
- [AWHAETP](/indicator/AWHAETP/): Average Weekly Hours of All Employees, Total Private
- [DGORDER](/indicator/DGORDER/): Manufacturers' New Orders: Durable Goods
- [NEWORDER](/indicator/NEWORDER/): Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft
- [BUSINV](/indicator/BUSINV/): Total Business Inventories
- [EXPGS](/indicator/EXPGS/): Exports of Goods and Services
- [IMPGS](/indicator/IMPGS/): Imports of Goods and Services
- [IR](/indicator/IR/): Import Price Index (End Use): All Commodities
- [PPIFIS](/indicator/PPIFIS/): Producer Price Index by Commodity: Final Demand

## Latest quarter (10-Q)

Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/1092796/000119312526093991/swbi-20260131.htm

Extracted structurally from real Item 2 body heading to real Item 3/4 boundary. Published MD&A gate trimmed front/tail over-capture.
Confidence: high
Filing date: 2026-03-05
Report date: 2026-01-31

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

Please refer to the Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Fiscal 2025 Annual Report and our unaudited condensed consolidated financial statements included in Item 1 of this Quarterly Report on Form 10-Q. This section sets forth key objectives and performance indicators used by us as well as key industry data tracked by us.

This section generally discusses year-to-year comparisons between the three and nine months ended January 31, 2026 and 2025. A discussion of our results of operations, liquidity, and capital resources for the three and nine months ended January 31, 2025 compared to January 31, 2024 is not included in this Quarterly Report on Form 10-Q and can be found in Item 2, "Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Quarterly Report on Form 10-Q for the quarterly period ended January 31, 2025, filed with the Securities and Exchange Commission, or the SEC, on March 6, 2025. See also the discussion below related to an immaterial correction of an error.

Third Quarter Fiscal 2026 Highlights

Our operating results for the three months ended January 31, 2026 included the following:

•
Net sales were $135.7 million, an increase of $19.8 million, or 17.1%, over the comparable quarter last year.

•
Gross margin was 26.2% compared with gross margin of 24.1% for the comparable quarter last year.

•
Net income was $3.8 million, or $0.08 per diluted share, compared with $2.1 million, or $0.05 per diluted share, for the comparable quarter last year.

Our operating results for the nine months ended January 31, 2026 included the following:

•
Net sales were $345.5 million, an increase of $11.6 million, or 3.5%, over the comparable period last year.

•
Gross margin was 25.5% compared with gross margin of 25.9% for the comparable period last year.

•
Net income was $2.3 million, or $0.05 per diluted share, compared with net income of $4.8 million, or $0.11 per diluted share, for the comparable period last year.

Immaterial Correction of an Error

During the fourth quarter of fiscal 2025, we identified an immaterial error related to our accrual for certain legal expenses, resulting in an overstatement of general and administrative expenses in the interim and annual periods for the fiscal year ended April 30, 2024 and during the interim periods for the fiscal year ended April 30, 2025. In accordance with SAB No. 99, Materiality, and SAB No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements, we evaluated the quantitative and qualitative considerations of the error and determined that the related impact was not material to the results of operations, financial position, or cash flows for any historical annual or interim period. Prior year amounts have been adjusted to correct the immaterial error, which overstated general and administrative expenses by $620,000 and $1.5 million and understated income tax expense by $181,000 and $419,000 for the three and nine months ended January 31, 2025, respectively. Related changes to net income, corresponding line items within cash provided by operating activities, and related disclosures within the notes accompanying these financial statements reflect the immaterial correction.

Results of Operations

Net Sales and Gross Profit – For the Three Months Ended January 31, 2026

The following table sets forth certain information regarding net sales and gross profit for the three months ended January 31, 2026 and 2025 (dollars in thousands):

2026

2025

$ Change

% Change

Handguns

$

107,393

$

79,764

$

27,629

34.6%

Long guns

19,255

27,665

(8,410

)

-30.4%

Other products & services

9,061

8,456

605

7.2%

Total net sales

$

135,709

$

115,885

$

19,824

17.1%

Cost of sales

100,120

87,938

12,182

13.9%

Gross profit

$

35,589

$

27,947

$

7,642

27.3%

% of net sales (gross margin)

26.2

%

24.1

%

19

The following table sets forth certain information regarding firearm units shipped by trade channel for the three months ended January 31, 2026 and 2025 (units in thousands):

Total Units Shipped

2026

2025

# Change

% Change

Handguns

256

200

56

28.0%

Long guns

36

46

(10

)

-21.7%

Sporting Goods Channel Units Shipped

2026

2025

# Change

% Change

Handguns

247

193

54

28.0%

Long guns

33

44

(11

)

-25.0%

Professional Channel Units Shipped

2026

2025

# Change

% Change

Handguns

9

7

2

28.6%

Long guns

3

2

1

50.0%

Sales of our handguns increased $27.6 million, or 34.6%, over the comparable quarter last year, primarily as a result of increased shipments of newly introduced products (defined as any new SKU not shipped in the comparable period last year), a shift in product mix to higher priced models, higher consumer demand, and a 2% to 3% price increase on select products that became effective on January 1, 2026. Shipments of new products represented 44.0% of handgun sales in the quarter. Handgun unit shipments into the sporting goods channel increased by 28.0% over the comparable quarter last year while overall demand for handguns decreased by 2.2% (as indicated by adjusted background checks reported in the National Instant Criminal Background Check System, or NICS) partially due to an increase in inventory at our distributors.

Sales of our long guns decreased $8.4 million, or 30.4%, from the comparable quarter last year, primarily as a result of the timing of new product launches in the comparable period last year and lower consumer demand during the period. Shipments of new products represented 27.5% of long gun sales in the period. Long gun unit shipments into the sporting goods channel decreased by 25.0% from the comparable quarter last year while overall demand for long guns decreased by 5.6% (as indicated by NICS). We believe the difference in our unit demand compared to NICS results was driven by stronger relative performance in categories in which we do not participate fully, specifically hunting, and a decrease in inventory at our distributors.

Other products and services revenue increased $605,000, or 7.2%, over the comparable quarter last year, primarily because of higher e-commerce sales.

Newly introduced products represented 38.7% of net sales for the three months ended January 31, 2026 and included four new pistols, four new long guns, and many new product line extensions.

Gross margin for the three months ended January 31, 2026 was 26.2% compared with 24.1% for the comparable quarter last year, primarily driven by favorable fixed-cost absorption from higher production volumes, lower promotional costs, and lower federal firearms excise taxes as a result of the favorable completion of a recent audit, partially offset by higher tariffs on imported materials and components and higher labor costs. We estimate higher tariffs negatively impacted gross margin by approximately 160 basis points when compared to the comparable quarter last year.

Net Sales and Gross Profit – For the Nine Months Ended January 31, 2026

The following table sets forth certain information regarding net sales and gross profit for the nine months ended January 31, 2026 and 2025 (dollars in thousands):

2026

2025

$ Change

% Change

Handguns

$

263,107

$

226,853

$

36,254

16.0

%

Long guns

57,529

77,517

(19,988

)

(25.8

)%

Other products & services

24,821

29,529

(4,708

)

(15.9

)%

Total net sales

$

345,457

$

333,899

$

11,558

3.5

%

Cost of sales

257,444

247,261

10,183

4.1

%

Gross profit

$

88,013

$

86,638

$

1,375

1.6

%

% of net sales (gross margin)

25.5

%

25.9

%

20

The following table sets forth certain information regarding firearm units shipped by trade channel for the nine months ended January 31, 2026 and 2025 (units in thousands):

Total Units Shipped

2026

2025

# Change

% Change

Handguns

635

549

86

15.7

%

Long guns

103

130

(27

)

(20.8

)%

Sporting Goods Channel Units Shipped

2026

2025

# Change

% Change

Handguns

605

516

89

17.2

%

Long guns

93

115

(22

)

(19.1

)%

Professional Channel Units Shipped

2026

2025

# Change

% Change

Handguns

30

33

(3

)

(9.1

)%

Long guns

10

15

(5

)

(33.3

)%

Sales of our handguns increased $36.3 million, or 16%, over the comparable period last year, primarily as a result of increased shipments of newly introduced products, higher consumer demand, and a 2% to 3% price increase on select products that became effective on January 1, 2026. Shipments of new products represented 42.0% of handgun sales in the period. Handgun unit shipments into the sporting goods channel increased by 17.2% over the comparable period last year while overall consumer handgun demand was largely flat (as indicated by NICS).

Sales of our long guns decreased $20.0 million, or 25.8%, from the comparable period last year, primarily as a result of the timing of new product launches in the comparable period last year and lower consumer demand during the period. Shipments of new products represented 38.1% of long gun sales in the period. Long gun unit shipments into the sporting goods channel decreased by 19.1% from the comparable period last year while overall consumer demand for long guns decreased by 7.1% (as indicated by NICS). We believe the difference in our unit demand compared to NICS results was driven by stronger relative performance in categories in which we do not participate fully, specifically hunting.

Other products and services revenue decreased $4.7 million, or 15.9%, from the comparable period last year, primarily because of lower business-to-business, parts, and suppressor sales; partially offset by higher e-commerce sales, which began in the third quarter of fiscal 2025.

Newly introduced products represented 38.3% of net sales for the nine months ended January 31, 2026.

Gross margin for the nine months ended January 31, 2026 was 25.5% compared with 25.9% for the comparable period last year, primarily driven by unfavorable fixed-cost absorption from lower production volumes, higher materials costs, and higher tariffs on imported materials and components, partially offset by favorable inventory adjustments (including standard cost revaluations, shrink, and excess inventory write downs), lower labor costs, lower promotional costs, and lower federal firearms excise taxes as a result of the favorable completion of a recent audit. We estimate higher tariffs negatively impacted gross margin by approximately 120 basis points when compared to the comparable period last year.

Inventory balances decreased $14.6 million between April 30, 2025 and January 31, 2026 as a result of our proactive inventory management and production planning efforts intended to optimize inventory levels and cash flows. While inventory levels, both internally and in the distribution channel, in excess of demand may negatively impact future operating results, it is difficult to forecast the potential impact of distributor inventories on future revenue and income as demand is impacted by many factors, including seasonality, new product introductions, news events, political events, and consumer tastes. We expect our inventory levels to decline during the remainder of the fiscal year.

21

Operating Expenses

The following table sets forth certain information regarding operating expenses for the three months ended January 31, 2026 and 2025 (dollars in thousands):

2026

2025

$ Change

% Change

Research and development

$

2,412

$

2,869

$

(457

)

-15.9

%

Selling, marketing, and distribution

11,170

10,336

834

8.1

%

General and administrative

15,482

12,379

3,103

25.1

%

Gain on sale/disposition of assets

(188

)

(2,382

)

2,194

-92.1

%

Total operating expenses

$

28,876

$

23,202

$

5,674

24.5

%

% of net sales

21.3

%

20.0

[Excerpt truncated for page length; source filing is linked above.]

## Latest 10-K MD&A

Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary.
Confidence: high

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following Management’s Discussion and Analysis of Financial Condition and Results of Operations in conjunction with our consolidated financial statements and the related notes thereto contained elsewhere in this Annual Report on Form 10-K. This discussion contains forward-looking statements that involve risks, uncertainties, and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those set forth under Item 1A, “Risk Factors” and elsewhere in this Annual Report on Form 10-K.

This section generally discusses year-to-year comparisons between fiscal 2026 and fiscal 2025. A discussion of our results of operations, liquidity, and capital resources for fiscal 2025 compared with fiscal 2024 is not included in this Annual Report on Form 10-K and can be found in Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for fiscal 2025, filed with the SEC on June 20, 2025.

2026 Highlights

Our operating results for fiscal 2026 included the following:

•
Net sales of $523.8 million represented an increase of $49.2 million, or 10.4%, over the prior fiscal year.

•
Gross profit increased $13.9 million, or 10.9%, over the prior fiscal year, primarily because of higher sales volume. Gross margin increased by ten basis points from the prior fiscal year primarily due to lower promotional costs and lower federal firearms excise taxes, partially offset by unfavorable fixed-cost absorption and a 100-basis point impact from higher tariffs.

•
Net income was $18.5 million, or $0.41 per diluted share, compared with net income of $13.4 million, or $0.30 per diluted share, for the prior fiscal year.

•
During fiscal 2026, we paid $23.2 million in dividends compared with $23.1 million in fiscal 2025.

•
During fiscal 2026, we repaid $60.0 million on our revolving credit facility.

Key Performance Indicators

We evaluate the performance of our business based upon operating profit and net income, which includes net sales, cost of sales, selling and administrative expenses, and certain components of other income and expense. We also track our return on invested capital, and we use adjusted EBITDAS (earnings before interest, taxes, depreciation, amortization, and stock-based compensation expense, excluding certain non-operational items), which is a non-GAAP financial metric, as a supplemental measure of our performance in order to provide investors with an improved understanding of underlying performance trends. We evaluate the performance of our products using measurements such as gross margin per unit produced, units produced per day, revenue by trade channel, and incoming orders per day.

External Factors that Impact the Firearm Industry

The firearm industry has been subject to many external factors in the past that have significantly increased the volatility of revenue generated by companies within the industry. These factors include, among others, fears surrounding crime and terrorism; significant news events; potential restrictions on the sale or makeup of firearms; actual and potential legislative, judicial, and regulatory actions; economic changes; and changes in the social and political environment, including congressional and presidential elections. See Item 1A, Risk Factors, for further discussion of external factors that impact the firearm industry. Although these external factors have created demand surges and volatility in the firearm market, and often make it difficult to predict demand, we believe that those external factors have also likely contributed to a long-term increase in consumer interest in firearms. We estimate that the annual domestic non-military firearm market is approximately $2.7 billion for handguns and $1.7 billion for long guns, excluding shotguns, based on the latest data for industry shipments as calculated by the National Shooting Sports Foundation, or NSSF, utilizing Firearms and Ammunition Excise Tax data for calendar year 2024. According to calendar 2025 reports by the ATF, the U.S. firearm manufacturing industry grew at a 6.2% compound annual growth

36

rate in units from 2019 through 2024, although there has been wide variation among years (e.g., 2019 to 2020 grew 58.0%). We believe that this expanding base of consumers combined with our strong brand reputation and attractive price points lend support to our goal of continuing to increase our market share.

Results of Operations

Net Sales and Gross Profit

The following table sets forth certain information regarding net sales and gross profit for the fiscal years ended April 30, 2026, 2025, and 2024 (dollars in thousands):

2026

2025

$ Change

% Change

2024

Handguns

$

394,404

$

331,936

$

62,468

18.8

%

$

381,898

Long guns

90,481

103,956

(13,475

)

(13.0

)%

116,491

Other products & services

38,960

38,769

191

0.5

%

37,444

Total net sales

$

523,845

$

474,661

$

49,184

10.4

%

$

535,833

Cost of sales

382,742

347,478

35,264

10.1

%

377,740

Gross profit

$

141,103

$

127,183

$

13,920

10.9

%

$

158,093

% of net sales (gross margin)

26.9

%

26.8

%

29.5

%

The following table sets forth certain information regarding units shipped by trade channel for the fiscal years ended April 30, 2026, 2025, and 2024 (units in thousands):

Total Units Shipped

2026

2025

# Change

% Change

2024

Handguns

935

798

137

17.2

%

836

Long guns

162

175

(13

)

(7.4

)%

228

Sporting Goods Channel Units Shipped

2026

2025

# Change

% Change

2024

Handguns

890

748

142

19.0

%

775

Long guns

149

158

(9

)

(5.7

)%

210

Professional Channel Units Shipped

2026

2025

# Change

% Change

2024

Handguns

45

50

(5

)

(10.0

)%

61

Long guns

13

17

(4

)

(23.5

)%

18

Sales of our handguns increased $62.5 million, or 18.8%, over fiscal 2025, primarily as a result of increased shipments of newly introduced products (defined as any new SKU not shipped in the prior year), higher consumer demand, and a 2% to 3% price increase on select products that became effective on January 1, 2026. Shipments of new products represented 43.6% of handgun sales in the period. Handgun unit shipments into the sporting goods channel increased 19.0% over fiscal 2025, while overall consumer demand decreased 0.2% (as indicated by adjusted background checks for handguns reported to the National Instant Criminal Background Check System, or NICS).

Sales of our long guns decreased $13.5 million, or 13.0%, from fiscal 2025, primarily as a result of the timing of new product launches in fiscal 2025, which were at higher selling prices, combined with lower consumer demand during fiscal 2026. Shipments of new products represented 30.6% of long gun sales in the period. Long gun unit shipments into the sporting goods channel decreased 5.7% from fiscal 2025, while overall consumer demand for long guns decreased 4.6% (as indicated by NICS).

Other products and services sales increased $191,000, or 0.5%, over fiscal 2025, as higher e-commerce and suppressor sales offset lower business-to-business sales. Lower business-to-business sales resulted from the closure of our Deep River facility in fiscal 2025 as part of the Relocation.

37

New products represented 38.1% of net sales for the year ended April 30, 2026 and included four new pistols, four new long guns, and many new product line extensions.

Gross margin for fiscal 2026 was 26.9% compared with 26.8% for fiscal 2025, primarily due to lower promotional costs and lower federal firearms excise taxes as a result of the favorable completion of a recent audit, partially offset by unfavorable fixed-cost absorption from lower production volumes combined with higher tariffs on imported materials and components. We estimate that higher tariffs negatively impacted gross margin by approximately 100 basis points when compared to the comparable period last year.

Inventory balances declined $33.6 million between April 30, 2025 and April 30, 2026 as a result of our proactive inventory management and production planning efforts intended to optimize inventory levels and cash flows. While inventory levels, both internally and in the distribution channel, in excess of demand may negatively impact future operating results, it is difficult to forecast the potential impact of distributor inventories on future revenue and income as demand is impacted by many factors, including seasonality, new product introductions, news events, political events, and consumer tastes. We expect our inventory levels to increase modestly during fiscal 2027.

Operating Expenses

The following table sets forth certain information regarding operating expenses for the fiscal years ended April 30, 2026, 2025, and 2024 (dollars in thousands):

2026

2025

$ Change

% Change

2024

Research and development

$

10,304

$

9,567

$

737

7.7

%

$

7,258

Selling, marketing, and distribution

41,598

41,314

284

0.7

%

40,611

General and administrative

59,999

54,933

5,066

9.2

%

63,133

Gain on sale/disposition of assets, net

(9

)

(2,515

)

2,506

-99.6

%

(11

)

Total operating expenses

$

111,892

$

103,299

$

8,593

8.3

%

$

110,991

% of net sales

21.4

%

21.8

%

20.7

%

Research and development expenses increased $737,000 because of higher tooling-related costs, partially offset by materials and testing costs, which were elevated in the prior year. Selling, marketing, and distribution expenses increased $284,000, primarily as a result of higher profit-related compensation expenses and one-time costs related to the grand opening event for the Academy, partially offset by lower promotional costs. General and administrative expenses increased $5.1 million over the prior year, primarily as a result of higher profit-related and stock-based compensation expenses, and higher legal expenses. During fiscal 2025, we sold certain real estate located adjacent to our former distribution center located in Columbia, Missouri for $2.3 million, net of transaction costs, and recognized a $2.3 million pre-tax gain on sale.

Operating Income

The following table sets forth certain information regarding operating income for the fiscal years ended April 30, 2026, 2025, and 2024 (dollars in thousands):

2026

2025

$ Change

% Change

2024

Operating income

$

29,211

$

23,884

$

5,327

22.3

%

$

47,102

% of net sales (operating margin)

5.6

%

5.0

%

8.8

%

Operating income for fiscal 2026 increased $5.3 million, or 22.3%, over the prior fiscal year, primarily for the reasons outlined above.

38

Other Income/(Expense), net

The following table sets forth certain information regarding other income for the fiscal years ended April 30, 2026, 2025, and 2024 (dollars in thousands):

2026

2025

$ Change

% Change

2024

Other income/(expense), net

$

669

$

(17

)

$

686

NM

$

6,672

Other income for fiscal 2026 increased $686,000, primarily as a result of investment income on our marketable securities.

Interest Expense, net

The following table sets forth certain information regarding interest expense for the fiscal years ended April 30, 2026, 2025, and 2024 (dollars in thousands):

2026

2025

$ Change

% Change

2024

Interest expense, net

$

(4,810

)

$

(4,622

)

$

188

4.1

%

$

(2,055

)

Interest expense increased by $188,000, primarily as a result of lower average cash balances, partially offset by lower average interest rates on debt and lower average debt balances during fiscal 2026 compared with fiscal 2025.

Income Tax Expense

The following table sets forth certain information regarding income tax expense for the fiscal years ended April 30, 2026, 2025, and 2024 (dollars in thousands):

2026

2025

$ Change

% Change

2024

Income tax expense

$

6,589

$

5,820

$

769

13.2

%

$

10,356

% of income from operations (effective tax

   rate)

26.3

%

30.2

%

-3.9

%

We recorded income tax expense of $6.6 million for fiscal 2026, $769,000 higher than the prior fiscal year, primarily because of increased profitability. Our effective tax rates were 26.3% and 30.2% for fiscal 2026 and 2025, respectively. The 2026 rate was impacted favorably as a result of a decrease in state taxable income from the prior year and favorable return to provision adjustments.

Net Income

The following table sets forth certain information regarding net income and the related per share data for the fiscal years ended April 30, 2026, 2025, and 2024 (dollars in thousands, except per share data):

2026

2025

$ Change

% Change

2024

Net income

$

18,481

$

13,425

$

5,056

37.7

%

$

41,363

Net income per share:

Basic

$

0.42

$

0.30

$

0.12

40.0

%

$

0.90

Diluted

$

0.41

$

0.30

$

0.11

36.7

%

$

0.89

Net income increased $5.1 million, or $0.11 per diluted share, over fiscal 2025 primarily for reasons outlined above.

39

Liquidity and Capital Resources

Our principal cash requirements are to finance the growth of our operations, including working capital and capital expenditures, and return capital to our stockholders. Capital expenditures for new product development and repair and replacement of equipment represent important cash needs.

The following table sets forth certain cash flow information for the fiscal years ended April 30, 2026, 2025, and 2024 (dollars in thousands):

2026

2025

$ Change

2024

Operating activities

$

114,195

$

(7,223

)

$

121,418

$

106,739

Investing activities

(28,240

)

(19,173

)

(9,067

)

(81,490

)

Financing activities

(82,996

)

(9,212

)

(73,784

)

(17,966

)

Total cash flow

$

2,959

$

(35,608

)

$

38,567

$

7,283

Operating Activities

Operating activities generally represent the principal source of our cash flow.

Cash provided by operating activities was $114.2 million in fiscal 2026 compared with $7.2 million of cash used in fiscal 2025. Cash provided by operating activities in fiscal 2026 was favorably impacted by a $33.6 million decrease in inventory compared with a $29.3 million increase in inventory in fiscal 2025, a $5.4 million increase in accounts payable compared with a $14.8 million decrease in accounts payable in fiscal 2025, a $6.1 million increase in accrued payroll and incentives compared with an $8.1 million decrease in accrued payroll and incentives in fiscal 2025, a $15.8 million decrease in accounts receivable compared with a $3.2 million decrease in accounts receivable in fiscal 2025, a $519,000 increase in accrued profit sharing compared with a $4.5 million decrease in accrued profit sharing in fiscal 2025, and higher net income. Cash provided by operating activities in fiscal 2026 was unfavorably impacted by a $3.0 million decrease in accrued expenses and deferred revenue compared with a $268,000 decrease in accrued expenses and deferred revenue in fiscal 2025.

Investing Activities

Cash used in investing activities increased $9.1 million for the fiscal 2026 compared with fiscal 2025, primarily as a result of $4.6 million of purchases of marketable securities during fiscal 2026, a $2.1 million increase in capital expenditures related to the Academy, and $2.3 million of proceeds included in fiscal 2025 related to the sale of certain real estate located adjacent to our former distribution center located in Columbia, Missouri.

We currently expect to spend $40.0 to $45.0 million on capital expenditures in fiscal 2027.

Financing Activities

Cash used by financing activities was $83.0 million for fiscal 2026 compared with $9.2 million for fiscal 2025. Cash used by financing activities during fiscal 2026 was primarily the result of $60.0 million in net repayments under our revolving line of credit and $23.2 million in dividend distributions. Cash used in financing activities for fiscal 2025 was primarily the result of $40.0 million of net borrowings, $25.5 million of stock repurchases, and $23.1 million in dividend distributions. We had no stock repurchases during fiscal 2026.

Credit Facilities — We entered into the Second Amended and Restated Credit Agreement on October 3, 2024. The Second Amended and Restated Credit Agreement provides for a revolving line of credit of $175.0 million at any one time, or the Revolving Line. The Revolving Line bears interest at either the Base Rate (as defined in the Second Amended and Restated Credit Agreement) or the Adjusted Term SOFR rate (as defined in the Second Amended and Restated Credit Agreement), plus an applicable margin based on our consolidated leverage ratio. The Second Amended and Restated Credit Agreement also provides a swingline facility in the maximum amount of $5.0 million at any one time (subject to availability under the Revolving Line). Each Swingline Loan (as defined in the Amended and Restated Credit Agreement) bears interest at the Base Rate, plus an applicable margin based on our Adjusted

40

Consolidated Leverage Ratio (as defined in the Second Amended and Restated Credit Agreement). Subject to the satisfaction of certain terms and conditions described in the Second Amended and Restated Credit Agreement, we have an option to increase the Revolving Line by an aggregate amount not exceeding $50.0 million. The Revolving Line matures on the earlier of October 3, 2029 or the date that is six months in advance of the earliest maturity of any Permitted Notes (as defined in the Second Amended and Restated Credit Agreement) under the Second Amended and Restated Credit Agreement.

As of April 30, 2026, we had $20.0 million of borrowings outstanding on the Revolving Line, bearing interest at an average rate of 5.72%, which was equal to the Adjusted Term SOFR rate plus an applicable margin.

The credit agreement for the Revolving Line contains financial covenants relating to maintaining a maximum leverage ratio and a minimum debt service coverage ratio. We were in compliance with all debt covenants as of April 30, 2026.

Share Repurchase Programs – On September 19, 2023, our Board of Directors authorized the repurchase of up to $50.0 million of our common stock, subject to certain conditions, in the open market or in privately negotiated transactions through September 19, 2024, or the 2023 Authorization. During fiscal 2025, we purchased 1,531,763 shares of our common stock for $21.4 million under the 2023 Authorization. The 2023 Authorization expired on September 19, 2024. On September 5, 2024, our Board of Directors authorized the repurchase of up to $50.0 million of our common stock, subject to certain conditions, in the open market or in privately negotiated transactions from September 20, 2024 through September 20, 2025, or the 2024 Authorization. As of April 30, 2026, we had repurchased 312,310 shares of our common stock for $4.1 million under the 2024 Authorization. On September 15, 2025, our Board of Directors authorized the repurchase of up to $50.0 million of our common stock, subject to certain conditions, in the open market or in privately negotiated transactions from September 21, 2025 through September 21, 2026, or the 2025 Authorization. As of April 30, 2026, we had not repurchased any shares of our common stock under the 2025 Authorization.

Finance Lease – We are a party to a material finance lease, which is a $46.2 million lease that has an effective interest rate of approximately 5.0% and is payable in 240 monthly installments through fiscal 2039, as well as a related payment and performance guaranty, dated October 26, 2017, in favor of the Original Missouri Landlord. The building is pledged to secure the amounts outstanding. As part of the Relocation, on January 31, 2023, we entered into the Assignment and Assumption Agreement and the Amended and Restated Guaranty. Because of the Amended and Restated Guaranty, we continue to account for this lease as we have since prior to the Relocation. During fiscal 2025 and 2026, AOUT made payments pursuant to this lease directly to the landlord and we neither received nor paid any cash related to this arrangement. See Note 3 — Leases for additional information.

As of April 30, 2026, we had $28.2 million in cash and cash equivalents on hand.

Based upon our current working capital position, current operating plans, and expected business conditions, we believe that our existing capital resources and credit facilities will be adequate to fund our operations for at least the next 12 months.

Our future capital requirements will depend on many factors, including net sales, the timing and extent of spending to support product development efforts, the expansion of sales and marketing activities, the timing of introductions of new products and enhancements to existing products, and the costs to ensure access to adequate manufacturing capacity. Future equity or debt financing may not be available to us on acceptable terms or at all. If sufficient funds are not available or are not available on acceptable terms, our ability to take advantage of unexpected business opportunities or to respond to competitive pressures could be limited or severely constrained.

Inflation

During fiscal 2026, 2025 and 2024 inflationary pressures resulted in increases in the cost of certain of the components, parts, raw materials, and other supplies necessary for the production of our products, as well as labor costs. We expect that inflation will continue to impact us during fiscal 2027.

41

Critical Accounting Estimates

Management's Discussion and Analysis of Financial Condition and Results of Operations is based upon our consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles. The preparation of these financial statements requires that we make accounting estimates, judgments, and assumptions that can have a meaningful effect on the reporting of consolidated financial statements. See Note 2 — Significant Accounting Policies for additional information.

Critical accounting estimates are defined as those reflective of significant judgments, estimates, and uncertainties, which may result in materially different results under different assumptions and conditions. We believe the following are our critical accounting estimates:

Inventories

Description: We value inventories at the lower of cost, using the first-in, first-out, or FIFO, method, or net realizable value.

Judgments and Uncertainties: An allowance for potential non-saleable inventory as a result of excess stock or obsolescence is based upon a detailed review of inventory, past history, and expected future usage.

Sensitivity of Estimate to Change: The assumptions used to assess inventory valuation consider historical activity. Changes in these estimates can have a significant impact on the assessment of excess and obsolete inventory, which could result in material losses.

Recent Accounting Pronouncements

The nature and impact of recent accounting pronouncements is discussed in Note 2 — Significant Accounting Policies to our consolidated financial statements, which is incorporated herein by reference.

Off-Balance Sheet Arrangements

We do not have any transactions, arrangements, or other relationships with unconsolidated entities that are reasonably likely to affect our liquidity or capital resources. We have no special purpose or limited purpose entities that provide off-balance sheet financing, liquidity, or market or credit risk support or that engage in leasing, hedging, research and development services, or other relationships that expose us to liability that is not reflected in our consolidated financial statements.