BRC Inc.

First-quarter 2026 net revenue increased 21% year over year. Wholesale revenue increased 31.5% year over year, while direct-to-consumer revenue increased 7%. Gross margin was 33%, down 305 basis points year over year, reflecting elevated coffee costs and nonrecurring items. Adjusted EBITDA increased from under $1 million to over $7 million, more than an eightfold increase, and adjusted EBITDA margin expanded 570 basis points. Free cash flow was $6 million in Q1 2026 versus a use of over $5 million a year ago. For 2026, management raised revenue guidance to at least 8% growth, or approximately $430 million, and adjusted EBITDA guidance to at least 35% growth, or approximately $29 million. They continue to expect gross margin of 34% to 36% for 2026, with Q2 revenue at least 10% year over year and Q2 adjusted EBITDA at least $5 million.

Chris Mondzelewski said the quarter showed meaningful progress against the company’s core growth priorities, with gains coming from distribution, better shelf productivity, and improved SKU-level performance. He framed the strategy as “land and expand,” emphasizing that the company is adding doors while also increasing items per door, which he said should support durable growth over the next 2 to 3 years. His tone was confident but measured, repeatedly stressing disciplined execution, better control of the business, and a focus on profitable growth rather than broad-based spending.

Matt Amigh highlighted 21% revenue growth, 33% gross margin, and adjusted EBITDA rising to over $7 million from under $1 million last year. He said gross margin was weighed down by elevated green coffee costs, tariff carryover in inventory, about 100 basis points from onboarding a new DTC fulfillment provider, and roughly 210 basis points from a one-time noncash coffee extract write-down; these were partly offset by about 50 basis points of supply chain and mix benefits. He also pointed to $39 million of debt, more than $52 million of total liquidity, and $6 million of free cash flow, and said the company expects positive cash flow with capex in line with prior year levels.

Analysts pressed management on how to reconcile the full-year 8% revenue guide with the stronger quarter-to-quarter progression implied by last year; management replied that guidance only includes confirmed pricing and secured distribution, while the year also faces tougher back-half comps from prior pricing, ACV gains, marketplace acceleration, and liquidation revenue that will not repeat. Another question focused on SKU breadth, and Chris Mondzelewski said the average grocer now carries nearly two more items than a year ago, with some customers already at 13 to 14 SKUs and room to expand further. On marketing spend and fuel-cost concerns, management said marketing will increase later in the year around promotional windows and America’s 250th, while higher fuel costs had not yet shown a measurable impact on convenience traffic or category performance.