Smith & Wesson Brands, Inc.

What they do

The company designs and manufactures firearms, primarily handguns and long guns, and sells them through sporting goods and professional channels in the U.S. It also generates revenue from other products and services, including parts and suppressors. Manufacturing is based in the U.S., with a relocation effort referenced in filings and earnings releases.

Revenue drivers

• Handguns — Largest product line, with fiscal 2026 net sales of $394.4 million, up 18.8% year over year, representing about 75% of total net sales.
• Long guns — Fiscal 2026 net sales of $90.5 million, down 13.0% year over year, representing about 17% of total net sales.
• Other products & services — Fiscal 2026 net sales of $39.0 million, up 0.5% year over year, including parts and suppressors.

Recent performance

In the first quarter of fiscal 2027, ended July 31, 2026, net sales were $112.6 million, up 32.3% from the comparable quarter last year. Gross margin was 28.7%, including a $2.9 million tariff refund that favorably impacted gross margin by approximately 260 basis points. Net income was $2.6 million, or $0.06 per diluted share, compared with a net loss of $3.4 million, or $0.08 per diluted share, in the prior-year quarter. Handgun sales rose 29.0% to $83.8 million and long gun sales rose 49.9% to $20.4 million.

Strategy

Management cites a focus on innovation, industry partnerships, and operational execution to drive growth. Newly introduced products represented 35.3% of overall net sales in the first quarter of fiscal 2027. The company continues to expect a normal seasonal environment and strong demand, and it authorized a $0.13 per share quarterly dividend payable October 1, 2026. It also repaid $60.0 million on its revolving credit facility during fiscal 2026.

Risks

• External demand volatility — The firearm industry is subject to demand surges and volatility from factors such as crime fears, news events, and elections, making demand difficult to predict.
• Regulatory and legislative risk — Actual or potential restrictions on the sale or makeup of firearms could adversely affect the company's business and operating results.
• Economic sensitivity — Consumer spending on discretionary items, including firearms, may be adversely impacted by economic uncertainty, unemployment, inflation, and interest rates.
• Tariffs and input costs — Higher tariffs had a 100-basis point negative impact on gross margin in fiscal 2026, and material or component cost increases could pressure profitability.

Outlook

For the second quarter of fiscal 2027, management expects sales to be roughly 10% above last year and to significantly outperform last year on both the top and bottom lines. For the full fiscal year 2027, the company expects revenue to grow approximately 5-7% over fiscal 2026. Management continues to expect a normal seasonal environment and strong demand for its products.