American Outdoor Brands (AOUT) reported a solid QQ3 2025, with net sales of $58.5 million, up 9.5% year over year, supported by strength in both outdoor lifestyle (+15.1%) and shooting sports (+~3%) categories. Gross margin expanded meaningfully to GAAP 44.7% (up 200 bps YoY) and non-GAAP gross margin at 45.0%, driven by higher volumes and lower inbound freight costs, partially offset by slower-moving inventory. Operating leverage remained modest, with GAAP operating income of $0.3 million and non-GAAP EPS of $0.21, while adjusted EBITDAS rose to $4.7 million (vs. $2.4 million a year ago), reflecting the company’s asset-light model and disciplined cost management.
Management emphasized the acceleration of product-driven growth as a core long-term strategy. New products, which historically contribute 20%+ of net sales annually, underpin margin expansion and addressable-market growth. Notable examples highlighted on the call include the Bubba SFS Lite scale and the Caldwell Clay Copter, both designed to broaden addressable markets and generate recurring revenue (e.g., Bubba Pro subscription) and consumables revenue. The company also reinforced a robust distribution strategy, securing expanded placements across BOG, Caldwell, Grilla, and Meet Your Maker, which supports brand awareness and new consumer cohorts.
In terms of guidance, management narrowed FY2025 net sales to $207–$210 million and projected GAAP gross margins around 45%, with second-half margins pressured by tariff and freight amortization. Adjusted EBITDA guidance was raised to $14.5–$15.5 million, implying meaningful YoY growth. For FY2026, the leadership outlined a target net sales range of $220–$230 million, signaling a growth trajectory of roughly 7.9% mid-point versus FY2025. The commentary also underscored Tariff risk as a key variable, but stressed the company’s optionality via its innovation pipeline, direct-to-consumer channel, and IP protection.
Overall, AOUT’s QQ3 2025 results underscore a strategically important pivot toward higher-margin, IP-protected products and an asset-light business model that can navigate tariff shocks while pursuing multi-year growth through product launches and broader retailer partnerships. Investors should monitor the cadence of new product introductions, the evolution of tariff exposure, and the pace of retailer commitments through FY2026.