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Oct 31, 2024
Smith & Wesson Q2 2025 Earnings Report
Smith & Wesson's Q2 2025 financial results were announced, revealing a mix of growth and challenges.
Key Takeaways
Smith & Wesson reported a 3.8% increase in net sales compared to the same quarter last year, driven by new product innovation. However, overall demand for firearms normalized late in the quarter, impacting expectations for the second half of the fiscal year. The company is focused on managing profitability and maintaining a strong balance sheet amidst a challenging demand environment.
Net sales reached $129.7 million, a 3.8% increase year-over-year.
Gross margin was 26.6%, compared to 25.4% in the prior year.
GAAP net income was $4.1 million, or $0.09 per diluted share.
Adjusted EBITDAS was $18.5 million, representing 14.3% of net sales.
Forward Guidance
Smith & Wesson anticipates a decrease in top-line revenue for the third quarter of fiscal year 2025, projecting a 10-15% decline compared to the previous fiscal year.
Positive Outlook
- New Bodyguard 380 pistol and lever action rifles drove net sales.
- The company authorized a new $50 million share repurchase program.
- A new unsecured $175 million line of credit was secured, increasing available borrowings.
- The board of directors authorized a $0.13 per share quarterly dividend.
- Company expects to maintain and gain share through innovation.
Challenges Ahead
- Overall demand for firearms normalized late in the second quarter.
- Consumer cautiousness with discretionary spending was more pronounced.
- Second quarter results came in below expectations.
- The company reduced expectations for the second half of fiscal 2025.
Historical Earnings Impact
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