Smith & Wesson Brands, Inc. Reports Second Quarter Fiscal 2025 Financial Results

Core Insights - Smith & Wesson Brands, Inc. reported Q2 fiscal 2025 net sales of $129.7 million, reflecting a sequential increase of 46.8% and a year-over-year increase of 3.8% [2][5] - The company experienced a gross margin of 26.6%, up from 25.4% in the same quarter last year, and a non-GAAP gross margin of 27.1% [3][4] - The adjusted EPS for Q2 was$ 0.11 per share, while GAAP EPS was $0.09 per share [4][12] Financial Performance - Q2 net sales were$ 129.7 million, an increase of $4.7 million (3.8%) year-over-year and$ 41.3 million (46.8%) sequentially [2] - Gross profit for Q2 was $34.5 million, with a gross margin of 26.6% compared to 25.4% in the prior year [3][12] - GAAP net income was$ 4.1 million, or $0.09 per diluted share, compared to$ 2.5 million, or $0.05 per diluted share, in the same quarter last year [3][12] - Non-GAAP net income was$ 4.8 million, or $0.11 per diluted share, down from$ 6.5 million, or $0.14 per diluted share, in the prior year [4] Operational Insights - The company noted that overall demand for firearms normalized late in the quarter, primarily due to inflation and consumer cautiousness regarding discretionary spending [5] - New products accounted for 44% of sales during the quarter, indicating a strong innovation pipeline [5] - The company has authorized a new$ 50 million share repurchase program and signed a new unsecured $175 million line of credit, increasing total available borrowings by$ 75 million [5] Future Outlook - The company has reduced its expectations for the second half of fiscal 2025, anticipating a top line approximately 10-15% lower than fiscal 2024 [5] - The management remains focused on maintaining profitability and a strong balance sheet while navigating the challenging demand environment [5]