Turning Point Brands, Inc.

First-quarter consolidated sales increased 17% year over year to $124.3 million. Gross profit was $68.3 million, up 14.6%, and gross margin was 55%, down 100 basis points year over year. Adjusted EBITDA was $25.9 million with a 20.8% margin. Modern Oral net sales rose 133% year over year to $52 million and gross sales rose 167% to $69 million; Modern Oral was 42% of consolidated net sales. Legacy Stoker’s brands net revenue declined 3.5% to $36 million, while Zig-Zag net sales fell 22% to $36.7 million. Free cash flow was negative $27.4 million and cash at quarter-end was $192.4 million. For full-year 2026, management raised Modern Oral gross sales guidance to $280 million-$300 million from $220 million-$240 million and net sales to $210 million-$225 million from $180 million-$190 million, and introduced EBITDA guidance of $70 million-$90 million. They also guided total sales and marketing investment to $80 million-$105 million, capital expenditures to $4 million-$5 million excluding Modern Oral projects, and an additional $3 million-$5 million for PMTAs.

Graham Purdy framed the quarter as early evidence of a long-term shift toward nicotine pouches and said TPB is positioning itself to capture share in what he called a greater than $50 billion opportunity. He emphasized that the company is prioritizing winning in nicotine pouches through investments in sales force, marketing, and manufacturing, while also saying the heritage business remains an important cash generator. His tone was upbeat and confident, but he repeatedly stressed disciplined investment and a long runway rather than near-term profitability maximization.

Andrew Flynn focused on the company’s financial bridge between strong growth and heavier investment. He said sales were up 17% to $124.3 million, gross profit rose to $68.3 million, adjusted EBITDA was $25.9 million, and free cash flow was negative $27.4 million because of trade, brand marketing, working capital, and U.S. manufacturing capex. He also detailed the spend outlook: sales and marketing investment of $80 million-$105 million, capex of $4 million-$5 million excluding Modern Oral, plus $3 million-$5 million for PMTAs, and said the company expects to be approximately cash flow breakeven for the rest of the year.

Analysts pressed management on the scale and timing of the new chain wins, the larger gross-vs-net sales guidance gap, and whether net sales would benefit more in the back half or in 2027. Management said some of the new chain placements will begin rolling out over the next few weeks, but full store resets will take time, and Andrew said net sales should see some pickup in the back half. Questions also focused on PMTA timing, Louisville manufacturing, and whether TKO sponsorship spending could pressure EBITDA further; management said PMTA is a rigorous process, Louisville equipment and throughput are progressing, and spending will remain judicious but flexible if it helps gain share.