Byrna Technologies Inc.

Net revenue in Q2 2026 was $16.4 million versus $28.5 million in the prior-year period. Gross profit was $1.8 million, or 11% of net revenue, compared with $17.6 million, or 62%, last year; excluding one-time items, adjusted gross profit was $10.1 million and adjusted gross margin was approximately 62%. Adjusted EBITDA was negative $600 thousand versus $4.3 million in Q2 2025, and net loss was $10.1 million versus net income of $2.4 million a year ago. E-commerce sales fell $5.8 million, or 35%, domestic dealer channel sales fell $3.5 million, or 47%, and international dealer/distributor sales fell $1.2 million, or 43%. Management said fiscal 2026 is not expected to be a revenue growth year; Q3 is a transition quarter, Q4 should improve with the holiday season, and the company still expects to exit fiscal 2026 with gross margins of approximately 62%.

Conn Davis framed Q2 as a necessary but steeper-than-expected reset and said the quarter reinforced the need for a business transformation. He emphasized three near-term priorities: improving consumer conversion and retail productivity, rebuilding demand generation with better attribution, and tying demand more tightly to production, inventory, and cash generation. His tone was urgent but constructive, stressing that the company is shifting to more disciplined, use-case-driven marketing and a more scalable operating model.

Laurilee Kearnes walked through the quarter’s financial pressure: revenue of $16.4 million, gross profit of $1.8 million, adjusted gross profit of $10.1 million, operating expenses of $14.6 million, net loss of $10.1 million, and adjusted EBITDA of negative $600 thousand. She highlighted one-time charges tied to the Fort Wayne ammo facility shutdown, including a $3.6 million inventory write-down and a $3.5 million impairment loss, partially offset by a $1.1 million tariff refund, and said adjusted gross margin should stay near or above 62% for the rest of the year. On capital and working capital, she said cash, cash equivalents and marketable securities were $10.4 million, with no debt, inventory was $30.4 million, and the company still expects inventory turns to approach 2x by year end.

Analysts pressed management on the higher expense run rate, the weak wholesale channel, and whether Q3 would look like another step down. Laurilee said Q2 is a reasonable baseline, but incremental spending of about $250 thousand a month tied to the new marketing plan should come before revenue, while the rest of OpEx is being held down as much as possible. On retail, Conn said partners remain excited but reorders lagged because inventories were elevated after Q1, and the Academy rollout shifted from Q2 into Q3 on timing. Questions on Hero focused on pricing, margins, and integration; management said Hero should sit below Byrna in price and capability, be integrated into byrna.com toward the end of Q3/Q4, and then be more fully tied into the Byrna brand in Q1 2027.