Regis 2026 Q1 Earnings Strong Turnaround as Net Income Surges 259%

Regis Corporation (RGS) reported its fiscal 2026 Q1 earnings on Nov 13, 2025, with total revenue rising 28.0% to $58.96 million, driven by the acquisition of company-owned salons. The company returned to profitability with EPS of $0.56, a 255.6% positive swing from a 2025 Q1 loss. Management provided optimistic guidance for 2026, projecting 4-6% revenue growth and EPS of $0.58–$0.62.

Revenue

Royalties and Fees led the charge with $15.82 million in revenue, supported by $14.04 million in Royalties and $1.78 million in Fees. Advertising fund contributions added $5.57 million, while Franchise rental income totaled $17.35 million. Company-owned salons contributed $20.21 million, reflecting the impact of the December 2024 acquisition of 281 salons from Align. The segment breakdown highlights a strategic shift toward expanding company-owned operations amid reduced franchise rental income.

Earnings/Net Income

Regis achieved a remarkable turnaround, reporting net income of $1.36 million in 2026 Q1, a 259.0% increase from the $-853,000 net loss in 2025 Q1. The EPS of $0.56 marked a dramatic reversal from a $-0.36 loss, underscoring the company’s improved operational efficiency and cost management.

Post-Earnings Price Action Review

The stock price of Regis declined 6.67% during the latest trading day, 3.48% over the most recent full week, and 9.06% month-to-date.

CEO Commentary

CEO John Smith attributed the 7% year-over-year service revenue growth to expanded digital platforms and enhanced client engagement. Challenges such as supply chain costs and competitive pricing pressures were acknowledged, but strategic investments in AI-driven analytics and franchise support were highlighted as growth levers. Smith emphasized sustainable market positioning through acquisitions and operational efficiency.

Guidance

Regis projected 4-6% revenue growth and $0.58–$0.62 EPS for 2026, driven by cost optimization and a 5% CAPEX reduction. The company aims for a 10% improvement in net income margin by year-end through operational streamlining.

Additional News

Regis announced the acquisition of 281 company-owned salons from Align in December 2024, bolstering its portfolio to 3,879 locations. The board is actively evaluating candidates for a permanent CEO, with a decision expected in the coming months. Additionally, franchisees will benefit from a $16 million FICA tax tip credit, with guidance being developed to help owners maximize the benefit.

Revenue Breakdown

The revenue surge was fueled by the Align acquisition, which added $19.4 million in company-owned salon revenue, offsetting lower royalties and non-margin franchise rental income.

Operational Momentum

Same-store sales growth of 0.9% and a 2.5% increase in Supercuts locations underscored Regis’s progress in stabilizing its franchise network. The loyalty program participation rose to 40%, and digital initiatives, including a new stylist pay plan, improved productivity and retention.

Financial Position

As of September 30, 2025, Regis held $25.5 million in liquidity, including $16.6 million in unrestricted cash. Outstanding debt stood at $124.8 million, with management prioritizing debt reduction and high-ROI projects.

Strategic Focus

The company remains committed to operational discipline, with plans to roll out a new Supercuts prototype in early 2026. Digital and AI initiatives are central to enhancing marketing efficiency and guest engagement, while store closures are expected to decline compared to prior years.

Risks and Outlook

Despite progress, challenges such as macroeconomic pressures and competitive pricing persist. However, management expressed confidence in navigating these headwinds through disciplined capital allocation and strategic acquisitions.