Regis Corporation reported a solid start to fiscal 2026 (QQ1) driven by the Align acquisition and ongoing transformations across its franchise and company-owned salon portfolio. Total quarterly revenue reached $58.96 million, up 28% year-over-year, supported by increased company-owned salon contributions from Align and a 0.9% consolidated same-store sales increase. Supercuts’ ongoing modernization contributed to a 2.5% same-store sales lift, with loyalty program participation rising to 40% from 36% in the prior quarter, signaling improving guest engagement and pricing discipline.
Adjusted EBITDA rose to $8.0 million, up $0.4 million year over year, as revenue expansion from the Align-acquired salons more than offset lower franchise royalties and franchise-only cost pressures. GAAP operating income was $5.92 million, a $3.8 million year-over-year improvement, and net income was $1.36 million (diluted EPS $0.49), supported by disciplined cost management and stronger company-owned salon performance. Operating cash flow was $2.28 million, marking the fourth consecutive quarter of positive cash from operations; free cash flow was $1.89 million. Regis ends QQ1 with liquidity of $25.5 million (including revolver capacity) and unrestricted cash of $16.6 million, while total debt stood at $124.8 million and net debt at $218.97 million, reflecting the levered impact of the Align integration.
Management highlighted a deliberate balance between growth and leverage, noting that near-term refinancing is not warranted given the terms of current debt agreements, though refinancing opportunities will be revisited as maturities approach. The transformation agenda—accelerating Supercuts’ pricing, online booking, and loyalty integration; expanding Forum Three and AI-driven marketing; and piloting a new salon prototype—aims to sustain profitable growth, improve unit economics, and deepen franchise partner alignment. The company expects higher unrestricted cash generation in fiscal 2026 driven by ongoing sales momentum and absence of one-time expenses in 2026, while AdFund cash will be deployed to support marketing initiatives.
Overall, Regis is progressing along its transformation path with meaningful topline growth, improving profitability, and healthier cash generation, albeit with elevated leverage and a continued emphasis on executing brand modernization and franchise ecosystem improvements.