Summary of Sportsman's Warehouse Q2 2026 Earnings Call

1Key Financial Results and Metrics

Net Sales: $295.6 million, a slight increase of 0.6% from $293.9 million in Q2 2025.

Same Store Sales: Essentially flat year-over-year, with a 6.7% increase in the hunting and shooting sports department.

Gross Margin: Improved to 32.5%, up 50 basis points from 32.0% in Q2 2025.

Net Loss: $4.4 million, or -$0.11 per diluted share, compared to a loss of $7.1 million, or -$0.18 per diluted share in the prior year.

Adjusted Net Loss: $3.1 million, or -$0.08 per diluted share, compared to an adjusted loss of $4.7 million, or -$0.12 per diluted share in Q2 2025.

Adjusted EBITDA: $8.7 million, up from $8.3 million in Q2 2025.

Total Inventory: $399 million, down $44.5 million (10%) year-over-year.

Net Debt: $169 million, reduced by $26 million compared to Q2 2025.

2Strategic Updates and Business Highlights

Sales Performance: Growth in hunting and shooting sports driven by strong demand for firearms and ammunition, while fishing sales were negatively impacted by drought conditions.

Inventory Management: Significant reduction in inventory levels, with a focus on aligning inventory with seasonal demand.

E-commerce Growth: Increased by nearly 3%, with hunting and fishing categories leading the growth.

Loyalty Program: Reinvention underway, aiming for a rollout in early 2027 to enhance customer retention and spending.

Operational Improvements: Enhanced in-stock levels (over 80%) and improved inventory efficiency, positioning the company favorably for the back half of the year.

3Forward Guidance and Outlook

Full Year Guidance:

Net sales expected to range from a decline of 1% to an increase of 1% compared to the previous year.

Adjusted EBITDA projected between $30 million and $36 million.

Capital expenditures anticipated to be between $20 million and $25 million, focusing on technology and store maintenance.

Market Position: Confidence in the back half of the year, particularly with curated assortments for hunting and holiday seasons.

4Bad News, Challenges, or Points of Concern

Consumer Pressure: Ongoing challenges due to elevated fuel prices impacting discretionary spending.

Category Performance: Declines in camping and softlines, although improvements are anticipated in the second half.

Promotional Environment: Increased promotional activity expected to continue due to competitive pressures and consumer spending constraints.

Store Closures: One confirmed closure and potential for more, indicating ongoing challenges in certain locations.

5Notable Q&A Insights

Camping and Softlines: Management expressed confidence in inventory levels and expected improvements in these categories, particularly in Q3.

Hunting and Shooting Trends: Strong performance noted, with firearms and ammunition sales driving growth.

Tariff Impact: The tariff refund was not significant for the company, but it was used to enhance customer value during a competitive environment.

Consumer Behavior: Notable trade-down behavior observed in certain categories, but continued strong spending on firearms and ammunition.

E-commerce Strategy: Improvements in online shopping experience expected to drive additional store traffic and sales. Overall, Sportsman's Warehouse is navigating a challenging consumer environment with strategic initiatives aimed at improving inventory management and enhancing customer engagement, while maintaining a cautious outlook for the remainder of the fiscal year.