Executive Summary
Lakeland Industries delivered a record QQ2 2026 top line of $52.5 million, up 36% year over year, underscored by rapid-fire growth in the fire services product line (113% YoY) and robust contributions from recent acquisitions. US revenue rose 78% to $22.1 million while Europe surged 113% to $15.1 million, reflecting cross-border demand and synergies from the Meridian and related fire services acquisitions. Adjusted EBITDA excluding FX rose to $5.1 million, up 89% YoY and up 740% sequentially, with an adjusted EBITDA margin of 9.6%. Despite stronger revenue, gross margins compressed to 37.4% adjusted (from 41.1% in the year-ago period) due to higher acquired-company margins, tariff-related costs, and input inflation, though the sequential improvement of ~220 bps reflects partial reversals of prior purchase-price variances and ongoing cost-reduction initiatives. Management highlighted ongoing tariff uncertainty but reiterated a strategic pivot toward higher-margin fire services and industrial PPE, plus a multi-faceted cost-reduction program that targets roughly $4 million in annualized savings (with ~$1 million already in the bag in Q2 and an additional $3 million anticipated). The company reaffirmed a full-year 2026 revenue outlook around the lower end of the $210–$220 million range and adjusted EBITDA excluding FX in the $20–$24 million range, acknowledging that LATAM softness and tariff dynamics could compress near-term margins. The pipeline remains robust, with four acquisitions completed in the last year and a stated intent to expand US service offerings, cross-sell, and pursue fire-suit rental, decontamination, and services opportunities. Net cash from operations remains negative in the near term due to working capital needs, but the balance sheet remains solid with $17.7 million in cash and cash equivalents and $28.1 million in long-term debt, plus ongoing asset-light, capital-efficient M&A potential. Overall, Lakeland appears well-positioned to tighten margins over time through operational leverage and higher-margin product mix, while maintaining a disciplined acquisition and cost-control strategy.
Key Performance Indicators
QoQ: 112 200.52% | YoY:136 210.76%
QoQ: 120 188.93% | YoY:123 418.21%
QoQ: -87 124.86% | YoY:-584 849.35%
QoQ: 19 675.77% | YoY:55 768.60%
QoQ: 119.51% | YoY:142.11%
Key Insights
Revenue: QQ2 2026 $52.5M, +36% YoY; Gross Profit: $18.8M; Gross Margin (GAAP-like): 35.8%; Adjusted Gross Margin: 37.4%; EBITDA (adjusted, ex FX): $5.1M; EBITDA Margin (adjusted, ex FX): 9.6%; Net Income: $0.8M; EPS: $0.08; Organic growth: 14% (Q2 YTD); Fire services revenue share: 47% YTD; Cash and equivalents: $17.7M; Long-term debt: $28.1M; Inventory: $90.2M; Trailing twelve months revenue: $191.6M; Trailing twelve months adjusted EBITDA, ex FX: $16.5M; Acquisitions contributing to revenue: M...
Financial Highlights
Revenue: QQ2 2026 $52.5M, +36% YoY; Gross Profit: $18.8M; Gross Margin (GAAP-like): 35.8%; Adjusted Gross Margin: 37.4%; EBITDA (adjusted, ex FX): $5.1M; EBITDA Margin (adjusted, ex FX): 9.6%; Net Income: $0.8M; EPS: $0.08; Organic growth: 14% (Q2 YTD); Fire services revenue share: 47% YTD; Cash and equivalents: $17.7M; Long-term debt: $28.1M; Inventory: $90.2M; Trailing twelve months revenue: $191.6M; Trailing twelve months adjusted EBITDA, ex FX: $16.5M; Acquisitions contributing to revenue: Meridian $5.2M; LHD $5.4M. YoY and QoQ comparisons reflect ongoing integration and tariff-driven dynamics, with management attributing margin compression to higher input costs and tariffs but signaling ongoing margin recovery as price-realization and synergies take hold.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
52.50B |
136 210.76% |
112 200.52% |
| Gross Profit |
18.82B |
123 418.21% |
120 188.93% |
| Operating Income |
-4.04B |
-584 849.35% |
-87 124.86% |
| Net Income |
766.00M |
55 768.60% |
19 675.77% |
| EPS |
0.08 |
142.11% |
119.51% |
Management Commentary
Key takeaways from the earnings call include: (1) Management emphasized acquisition-driven growth, with Meridian adding $5.2M of quarterly revenue and LHD contributing $5.4M across Germany, Australia, and Hong Kong, reinforcing a diversified global footprint. (2) Tariff headwinds were cited as a primary margin drag in QQ2, though price increases and expense controls are catching up, with expectations of margin recovery in coming quarters. (3) A cost-reduction program is underway, targeting approximately $4M in annualized savings, including warehouse consolidations and logistics optimizations, with ~1.0M of savings realized in Q2 and additional savings expected in the back half of fiscal 2026. (4) The management views the fire services and industrial PPE segments as the growth pillars and indicated ongoing M&A activity to broaden cross-selling, expand US coverage, and pursue service-oriented opportunities such as decontamination and rental. (5) The guidance for FY26 was reaffirmed to a revenue level near the lower end of $210–$220M and Adjusted EBITDA excluding FX of $20–$24M, acknowledging tariff uncertainty and LATAM softness as the primary near-term risks.
We achieved record net sales of $52.5 million, representing a 36% year-over-year increase.
— Jim Jenkins
Adjusted EBITDA excluding FX margin in 2026 was 9.6%, an increase of 270 basis points from 6.9% in 2025.
— Roger Shannon
Forward Guidance
Management updated FY26 guidance to approximately $210–$220 million revenue (near the lower end) and adjusted EBITDA excluding FX of $20–$24 million. They expect ongoing top-line growth from fire services and industrial verticals, improved margins through cost reductions and the integration of acquisitions, and additional synergies from cross-selling. The back-half outlook hinges on RFP activity timing in the US and Europe and a rebound in LATAM; management projects incremental gross-margin improvement from late 2026 onward as price realization catches up with tariffs and as inventory normalization progresses. Key factors to monitor include: (1) US and European RFP cadence for fire services; (2) progress on inventory-driven working capital optimization and end-market demand in LATAM; (3) achievement of targeted $3–$4 million in annualized cost savings; (4) integration milestones and cross-sell opportunities from Meridian, Viridian, LHD, Jolly, and related assets; (5) tariff policy developments and price-mitigation strategies across geographies.