American Outdoor 2026 Q2 Earnings EPS Drops 33.3% Amid 5% Revenue Decline

American Outdoor Brands (AOUT) reported fiscal 2026 Q2 earnings on December 9, 2025, with revenue declining 5.0% to $57.20 million and EPS falling 33.3% to $0.16. The company guided for full-year 2026 net sales to decrease 13%-14%, reflecting macroeconomic challenges and inventory management complexities.

Revenue

The total revenue of American Outdoor decreased by 5.0% to $57.20 million in 2026 Q2, down from $60.23 million in 2025 Q2. E-commerce channel net sales amounted to $20.42 million, while traditional channel net sales reached $36.78 million, contributing to the overall decline.

Earnings/Net Income

American Outdoor's EPS declined 33.3% to $0.16 in 2026 Q2 from $0.24 in 2025 Q2. Meanwhile, the company's net income fell to $2.08 million in 2026 Q2, a 33.3% drop from $3.11 million in 2025 Q2. The earnings performance indicates a significant contraction in profitability.

Price Action

The stock price of American Outdoor surged 6.65% during the latest trading day, 12.41% during the most recent full trading week, and 16.67% month-to-date.

Post-Earnings Price Action Review

The strategy of buying American Outdoor (AOUT) shares after their revenue raise quarter-over-quarter on the financial report released date and holding for 30 days resulted in a significant underperformance. The strategy had a CAGR of -8.22% over the past three years, with a maximum drawdown of 0.00% and a Sharpe ratio of -0.16, indicating a high risk and a negative return. The strategy's excess return was -90.21%, meaning it significantly underperformed the benchmark, which had a return of 67.70%.

CEO Commentary

Brian Murphy, President and CEO, highlighted strong business performance driven by innovation and disciplined execution, with second-quarter results surpassing expectations. He noted a 4% year-over-year point-of-sale (POS) growth, emphasizing resilience despite macroeconomic challenges and evolving consumer spending patterns. Strategic priorities include expanding into new outdoor product categories and leveraging innovation to reshape markets, exemplified by the Caldwell Clay Copter’s success. Murphy expressed cautious optimism, acknowledging retailer inventory management complexities but underscored confidence in the company’s agility and innovation pipeline.

Guidance

American Outdoor expects full-year 2026 net sales to decline 13%-14% year-over-year, excluding the $10 million of accelerated orders from the prior year, with underlying sales down ~5%. For Q3, net sales are projected to fall 8% YoY. Adjusted EBITDA is guided to 4%-4.5% of net sales, with gross margin expected at 42%-43% for both Q3 and the full year.

Additional News

American Outdoor Brands announced a $10 million share buyback program, signaling confidence in its undervalued stock. The company also highlighted successful innovation efforts, with new products accounting for 31% of net sales, including the Caldwell Clay Copter. Additionally, management targets inventory reduction to $115 million by fiscal year-end, addressing supply chain challenges and optimizing asset utilization.