aout-20260131

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________________________________________

Form 10-Q

_______________________________________________________


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended January 31, 2026

Commission File No. 001-39366

_______________________________________________________

American Outdoor Brands, Inc.

(Exact name of registrant as specified in its charter)

_______________________________________________________


Delaware						84-4630928
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


1800 North Route Z Columbia, Missouri						65202
(Address of principal executive offices)						(Zip Code)

(800) 338-9585

(Registrant’s telephone number, including area code)

_______________________________________________________

Securities registered pursuant to Section 12(b) of the Act:


Title of each Class	Trading Symbol	Name of exchange on which registered
Common Stock, par value $0.001 per share	AOUT	Nasdaq Global Select Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

The registrant had 12,595,760 shares of common stock, par value $0.001, outstanding as of March 6, 2026.

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AMERICAN OUTDOOR BRANDS, INC.

Quarterly Report on Form 10-Q

For the Three and Nine Months Ended January 31, 2026 and 2025

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PART I - FINANCIAL INFORMATION
	Item 1. Financial Statements (Unaudited)	5
	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
	Item 3. Quantitative and Qualitative Disclosures About Market Risk	32
	Item 4. Controls and Procedures	32

PART II - OTHER INFORMATION
	Item 1. Legal Proceedings	33
	Item 1A. Risk Factors	33
	Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	33
	Item 5. Other Information	33
	Item 6. Exhibits	34
Signatures		35

Accumax®, BOG®, BUBBA®, Caldwell®, Deadshot®, Deathgrip®, Delta Series®, Don’t Be Outdoorsy – Be Outdoors®, E-MAX®, Engineered for the Unknown®, F.A.T. Wrench®, Fieldpod®, Frankford Arsenal®, Golden Rod®, Hooyman®, Imperial®, Intellidropper®, Lead Sled®, Lockdown®, Lockdown Puck®, Mag Charger®, MEAT! Your Maker®, Old Timer®, Schrade®, Sharpfinger®, Tipton®, Grilla®, Grilla Grills®, Uncle Henry®, Unmatched Accuracy at the Bench and in the Field®, ust®, Wheeler®, XLA Bipod®, Your Land. Your Legacy®, Crimson Trace®, Lasergrips®, Laserguard®, LaserLyte®, Lasersaddle®, Lightguard®, and Rail Master® are some of the registered U.S. trademarks of our company or one of our subsidiaries. AOB Products Company™, Dock and Unlock ™, From Niche to Known™, MEAT!™, Secure Your Lifestyle™, The Ultimate Lifestyle™, and Water to Plate™ are some of the unregistered trademarks of our company or one of our subsidiaries. Trademarks licensed to us by Smith & Wesson Brands, Inc. in connection with the manufacture, distribution, marketing, advertising, promotion, merchandising, shipping, and sale of certain licensed accessory product categories include M&P®, Performance Center®, and Smith & Wesson®, among others. This report also may contain trademarks and trade names of other companies.

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Statement Regarding Forward-Looking Information

The statements contained in this Quarterly Report on Form 10-Q that are not historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. All statements other than statements of historical facts contained or incorporated herein by reference in this Quarterly Report on Form 10-Q, including statements regarding our future operating results, future financial position, business strategy, objectives, goals, plans, prospects, markets, and plans and objectives for future operations, are forward-looking statements. In some cases, you can identify forward-looking statements by terms such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “suggests,” “targets,” “contemplates,” “projects,” “predicts,” “may,” “might,” “plan,” “would,” “should,” “could,” “may,” “can,” “potential,” “continue,” “objective,” or the negative of those terms, or similar expressions intended to identify forward-looking statements. However, not all forward-looking statements contain these identifying words. Specific forward-looking statements in this Quarterly Report on Form 10-Q include statements regarding the following:

•our expectation that the unrecognized compensation expense related to unvested restricted stock units, or RSUs, and performance-based restricted stock units, or PSUs, will be recognized over a weighted average remaining contractual term of 1.0 years;

•our intention to vigorously defend ourselves in the lawsuits to which we are subject;

•the possibility that an unfavorable outcome of litigation or prolonged litigation could harm our business;

•the consolidated financial statements may not be indicative of our future performance;

•our belief that our future ability to fund our operating needs will depend on our future ability to generate positive cash flow from operations and obtain financing on acceptable terms;

•our belief that we will meet known or reasonably likely future cash requirements through the combination of cash flows from operating activities, available cash balances, and available borrowings through our existing $75 million credit facility;

•our expectation that our overall cost of debt funding may increase and decrease the overall debt capacity and commercial credit available to us;

•our future capital requirements depend on many factors, including net sales, the timing and extent of spending to support product development efforts, the expansion of sales and marketing activities, the timing of introductions of new products and enhancements to existing products, and any acquisitions or strategic investments that we may determine to make;

•the possibility that our ability to take advantage of unexpected business opportunities or to respond to competitive pressures could be limited or severely constrained if sufficient funds are not available or are not available on acceptable terms;

•our expectation to continue to utilize our cash flows to invest in our business, including research and development for new product initiatives; hire additional employees; fund growth strategies, including any potential acquisitions; repay any indebtedness we may incur over time; and repurchase our common stock if we have authorization to do so; and

•the possibility that increased demand for sourced products in various industries and other transportation disturbances could cause delays at various U.S. ports, which could delay the timing of receipt or cost of our products.

A number of factors could cause our actual results to differ materially from those indicated by the forward-looking statements. Such factors include, among others, the following:

•potential disruptions in our suppliers’ ability to source the raw materials necessary for the production of our products, disruptions and delays in the manufacture of our products, and difficulties encountered by retailers and other components of the distribution channel for our products;

•lower levels of consumer spending in general and specific to our products or product categories;

•our ability to introduce new products that are successful in the marketplace;

•interruptions of our arrangements with third-party contract manufacturers and freight carriers that disrupt our ability to fill our customers’ orders;

•increases in costs or decreases in availability of finished products, components, and raw materials;

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•the uncertainty around tariff policies and potential recovery of tariffs paid that have been determined to be unlawful, and the potential for increased tariffs on our products, including additional tariffs that may be imposed by the current presidential administration;

•our ability to maintain or strengthen our brand recognition and reputation;

•our ability to forecast demand for our products accurately;

•our ability to continue to expand our e-commerce business;

•our ability to compete in a highly competitive market;

•our dependence on large customers;

•our ability to attract and retain talent;

•pricing pressures by our customers;

•our ability to collect our accounts receivable;

•the potential for product recalls, product liability, and other claims or lawsuits against us;

•our ability to protect our intellectual property;

•inventory levels, both internally and in the distribution channel, in excess of demand;

•our ability to identify acquisition candidates, to complete acquisitions of potential acquisition candidates, to integrate acquired businesses with our business, to achieve success with acquired companies, and to realize the benefits of acquisitions in a manner consistent with our expectations;

•the performance and security of our information systems;

•our ability to comply with any applicable foreign laws or regulations and the effect of any increased protective tariffs;

•economic, social, political, legislative, and regulatory factors, such as the impact from changing economic policies, tariffs and supply chain constraints;

•the potential for increased regulation of firearms and firearms-related products;

•future investments for capital expenditures, liquidity, and anticipated cash needs and availability;

•the potential for impairment charges;

•estimated amortization expense of intangible assets for future periods;

•actions of social or economic activists that could, directly or indirectly, have an adverse effect on our business;

•disruptions caused by social unrest, including related protests or disturbances;

•our assessment of factors relating to the valuation of assets acquired and liabilities assumed in acquisitions, the timing for such evaluations, and the potential adjustment in such evaluations; and

•other factors detailed from time to time in our reports filed with the Securities and Exchange Commission, or the SEC, including information contained herein.

All forward-looking statements included herein, or in our Annual Report on Form 10-K, are based on information available to us as of their respective dates and speak only as of such dates. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements. The forward-looking statements contained in or incorporated by reference into this Quarterly Report on Form 10-Q, or in our Annual Report on Form 10-K, reflect our views as of the date of these reports about future events and are subject to risks, uncertainties, assumptions, and changes in circumstances that may cause our actual results, performance, or achievements to differ significantly from those expressed or implied in any forward-looking statement. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future events, results, performance, or achievements.

We are subject to the informational requirements of the Exchange Act, and we file or furnish reports, proxy statements, and other information with the SEC. Such reports and other information we file with the SEC are available free of charge at https://ir.aob.com/financial-information/sec-filings as soon as practicable after such reports are available on the SEC’s website at sec.gov. The SEC’s website contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC.

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PART I — FINANCIAL INFORMATION

Item 1. Financial Statements

AMERICAN OUTDOOR BRANDS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS


	As of:
	January 31, 2026 (Unaudited)		April 30, 2025

	(In thousands, except par value and share data)
ASSETS
Current assets:
Cash and cash equivalents	$	10,395	$	23,423
Accounts receivable, net of allowance for credit losses of $408 on January 31, 2026 and $159 on April 30, 2025	32,919		39,337
Inventories	110,177		104,717
Assets held for sale	899		—
Prepaid expenses and other current assets	4,013		3,970
Income tax receivable	188		143
Total current assets	158,591		171,590
Property, plant, and equipment, net	9,820		11,231
Intangible assets, net	25,250		31,411
Right-of-use assets	31,157		31,896
Other assets	155		227
Total assets	$	224,973	$	246,355
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	12,687	$	15,717
Accrued expenses	13,297		13,872
Accrued payroll and incentives	554		5,871
Lease liabilities, current	1,537		1,336
Total current liabilities	28,075		36,796
Lease liabilities, net of current portion	31,229		31,949
Total liabilities	59,304		68,745
Commitments and contingencies (Note 11)
Equity:
Preferred stock, $0.001 par value, 20,000,000 shares authorized, no shares issued or outstanding on January 31, 2026 and April 30, 2025	—		—
Common stock, $0.001 par value, 100,000,000 shares authorized, 15,232,922 shares issued and 12,459,653 shares outstanding on January 31, 2026 and 14,974,217 shares issued and 12,696,356 shares outstanding on April 30, 2025	15		15
Additional paid in capital	282,214		280,711
Retained deficit	(83,527)		(74,700)
Treasury stock, at cost (2,773,269 shares on January 31, 2026 and 2,277,861 shares on April 30, 2025)	(33,033)		(28,416)
Total equity	165,669		177,610
Total liabilities and equity	$	224,973	$	246,355

See accompanying notes to unaudited condensed consolidated financial statements.

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AMERICAN OUTDOOR BRANDS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)


	For the Three Months ended January 31,				For the Nine Months ended January 31,
	2026		2025		2026		2025

	(In thousands, except per share data)
Net sales	$	56,576	$	58,505	$	143,477	$	160,380
Cost of sales	33,396		32,382		80,341		86,425
Gross profit	23,180		26,123		63,136		73,955
Operating expenses:
Research and development	1,332		1,947		4,509		5,487
Selling, marketing, and distribution	14,369		15,019		39,220		41,376
General and administrative	7,959		8,854		24,614		26,293
Impairment of assets held for sale	3,433		—		3,433		—
Total operating expenses	27,093		25,820		71,776		73,156
Operating (loss)/income	(3,913)		303		(8,640)		799
Other (expense)/ income, net:
Other income, net	6		47		100		189
Interest (expense)/income, net	(165)		(123)		(233)		19
Total other (expense)/income, net	(159)		(76)		(133)		208
(Loss)/income from operations before income taxes	(4,072)		227		(8,773)		1,007
Income tax expense	1		58		54		92
Net (loss)/income	$	(4,073)	$	169	$	(8,827)	$	915
Net (loss)/income per share:
Basic	$	(0.32)	$	0.01	$	(0.70)	$	0.07
Diluted	$	(0.32)	$	0.01	$	(0.70)	$	0.07
Weighted average number of common shares outstanding:
Basic	12,549		12,764		12,635		12,830
Diluted	12,549		13,124		12,635		13,215

See accompanying notes to unaudited condensed consolidated financial statements.

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AMERICAN OUTDOOR BRANDS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited)

(In thousands)


	Common Stock			Additional Paid-In Capital				Treasury Stock
For the three months ended January 31, 2026 and 2025	Shares	Amount				Retained Deficit		Shares	Amount		Total Equity
Balance at October 31, 2024	14,890	$	15	$	278,677	$	(73,877)	2,057	$	(25,961)	$	178,854
Net income	—	—		—		169		—	—		169
Stock-based compensation	—	—		887		—		—	—		887

Issuance of common stock under restricted stock unit awards, net of tax	21	—		(2)		—		—	—		(2)
Repurchase of treasury stock	—	—		—		—		117	(1,222)		(1,222)
Balance at January 31, 2025	14,911	$	15	$	279,562	$	(73,708)	2,174	$	(27,183)	$	178,686

Balance at October 31, 2025	15,222	$	15	$	281,438	$	(79,454)	2,592	$	(31,602)	$	170,397
Net loss	—	—		—		(4,073)		—	—		(4,073)
Stock-based compensation	—	—		776		—		—	—		776

Issuance of common stock under restricted stock unit awards, net of tax	11	—		—		—		—	—		—
Repurchase of treasury stock	—	—		—		—		181	(1,431)		(1,431)
Balance at January 31, 2026	15,233	$	15	$	282,214	$	(83,527)	2,773	$	(33,033)	$	165,669


	Common Stock			Additional Paid-In Capital				Treasury Stock
For the nine months ended January 31, 2026 and 2025	Shares	Amount				Retained Deficit		Shares	Amount		Total Equity
Balance at April 30, 2024	14,701	$	15	$	277,107	$	(74,623)	1,903	$	(24,574)	$	177,925
Net income	—	—		—		915		—	—		915
Stock-based compensation	—	—		2,685		—		—	—		2,685
Shares issued under employee stock purchase plan	39	—		286		—		—	—		286
Issuance of common stock under restricted stock unit awards, net of tax	171	—		(516)		—		—	—		(516)
Repurchase of treasury stock	—	—		—		—		271	(2,609)		(2,609)
Balance at January 31, 2025	14,911	$	15	$	279,562	$	(73,708)	2,174	$	(27,183)	$	178,686

Balance at April 30, 2025	14,974	$	15	$	280,711	$	(74,700)	2,278	$	(28,416)	$	177,610
Net loss	—	—		—		(8,827)		—	—		(8,827)
Stock-based compensation	—	—		2,275		—		—	—		2,275
Shares issued under employee stock purchase plan	40	—		304		—		—	—		304
Issuance of common stock under restricted stock unit awards, net of tax	219	—		(1,076)		—		—	—		(1,076)
Repurchase of treasury stock	—	—		—		—		495	(4,617)		(4,617)
Balance at January 31, 2026	15,233	$	15	$	282,214	$	(83,527)	2,773	$	(33,033)	$	165,669

See accompanying notes to unaudited condensed consolidated financial statements.

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AMERICAN OUTDOOR BRANDS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	For the Nine Months Ended January 31,
	2026		2025

	(In thousands)
Cash flows from operating activities:
Net (loss)/income	$	(8,827)	$	915
Adjustments to reconcile net (loss)/income to net cash used in operating activities:
Depreciation and amortization	9,445		9,814

Provision for credit losses on accounts receivable	(352)		26
Impairment of assets held for sale	3,433		—
Stock-based compensation expense	2,275		2,685
Changes in operating assets and liabilities:
Accounts receivable	6,770		(5,940)
Inventories	(9,008)		(22,456)
Prepaid expenses and other current assets	(43)		3,072
Income tax receivable	(45)		10
Accounts payable	(2,572)		3,811
Accrued payroll and incentives	(5,317)		(537)
Right of use assets	1,107		1,236
Accrued expenses	(1,063)		1,872
Other assets	—		74
Lease liabilities	(887)		(978)

Net cash used in operating activities	(5,084)		(6,396)
Cash flows from investing activities:
Payments to acquire patents and software	(550)		(799)

Payments to acquire property and equipment	(2,005)		(2,594)
Net cash used in investing activities	(2,555)		(3,393)
Cash flows from financing activities:
Proceeds from notes and loans payable	9,120		7,000
Payments on notes and loans payable	(9,120)		(7,000)
Payments to acquire treasury stock	(4,617)		(2,609)
Proceeds from exercise of options to acquire common stock, including employee stock purchase plan	304		286
Payment of employee withholding tax related to restricted stock units	(1,076)		(516)
Net cash used in financing activities	(5,389)		(2,839)
Net decrease in cash and cash equivalents	(13,028)		(12,628)
Cash and cash equivalents, beginning of period	$	23,423	$	29,698
Cash and cash equivalents, end of period	$	10,395	$	17,070
Supplemental disclosure of cash flow information
Cash paid for:
Interest	$	273	$	236
Income taxes (net of refunds)	$	95	$	72

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AMERICAN OUTDOOR BRANDS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(Unaudited)

Supplemental Disclosure of Non-cash Operating and Investing Activities (in thousands):


	For the Nine Months Ended January 31,
	2026		2025
	(In thousands)
Purchases of property and equipment and intangibles included in accounts payable	$	579	$	146
Changes in right of use assets for operating lease obligations	368		—
Changes in lease liabilities for operating lease obligations	368		—
Record assets held for sale	4,332		—

See accompanying notes to unaudited condensed consolidated financial statements.

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AMERICAN OUTDOORS BRANDS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended January 31, 2026 and 2025

(1) Organization:

American Outdoor Brands, Inc. and its wholly owned Subsidiaries (our "company," "we," "us," or "our") is a leading provider of outdoor lifestyle products and shooting sports accessories encompassing hunting, fishing, meat processing, outdoor cooking, camping, shooting, and personal security and defense products for rugged outdoor enthusiasts. We conceive, design, source, and sell our outdoor lifestyle products, including premium sportsman knives and tools for fishing and hunting; land management tools for hunting preparedness; products used while hunting; meat processing equipment; outdoor cooking products; and camping, survival, and emergency preparedness products. We conceive, design, produce or source, and sell our shooting sports accessories, such as rests, vaults, and other related accessories; electro-optical devices, including hunting optics, firearm aiming devices, flashlights, and laser grips; and reloading, gunsmithing, and firearm cleaning supplies. We develop and market all our products as well as manufacture some of our electro-optics products at our facility in Columbia, Missouri. We also contract for the manufacture and assembly of most of our products with third parties located in Asia.

We focus on our brands and the establishment of product categories in which we believe our brands will resonate strongly with the activities and passions of consumers and enable us to capture an increasing share of our overall addressable markets. Our owned brands include BOG, BUBBA, Caldwell, Crimson Trace, Frankford Arsenal, Grilla Grills, or Grilla, Hooyman, Imperial, LaserLyte, Lockdown, MEAT! Your Maker, Old Timer, Schrade, Tipton, Uncle Henry, ust, and Wheeler, and we license additional brands for use in association with certain products we sell, including M&P, Smith & Wesson, and Performance Center by Smith & Wesson. In focusing on the growth of our brands, we organize our product development, customer service, and marketing teams into four brand lanes, each of which focuses on one of four distinct consumer verticals – Adventurer, Harvester, Marksman, and Defender – with each of our brands included in one of the brand lanes.

•Our Adventurer brands include products that help enhance consumers’ fishing, outdoor cooking, and camping experiences.

•Our Harvester brands focus on the activities hunters typically engage in, including the activities to prepare for the hunt, the hunt itself, and the activities that follow a hunt, such as meat processing.

•Our Marksman brands address product needs arising from consumer activities that take place primarily at the shooting range and where firearms are cleaned, maintained, and worked on.

•Our Defender brands focus on protection and include products that are used by consumers in situations that require self-defense for training and for securing high value or high consequence possessions.

(2) Basis of Presentation:

Interim Financial Information

Our unaudited condensed consolidated financial statements have been prepared in accordance with the requirements of the SEC for interim reporting. As permitted under those rules, certain disclosures and other financial information that normally are required by accounting principles generally accepted in the United States ("GAAP") have been condensed or omitted. Our accounting policies are described in the Notes to the Consolidated Financial Statements in our Annual Report on Form 10-K for our fiscal year ended April 30, 2025. We are responsible for the condensed consolidated financial statements included in this report, which are unaudited but, in our opinion, include all adjustments necessary for a fair presentation of our condensed consolidated balance sheet as of January 31, 2026, our condensed consolidated statement of operations for the three and nine months ended January 31, 2026 and 2025, and our condensed consolidated statement of cash flows for the nine months ended January 31, 2026 and 2025. The consolidated balance sheet as of April 30, 2025 was derived from audited financial statements.

The results reported in these condensed consolidated financial statements should not necessarily be taken as indicative of results that may be expected for the entire fiscal year.

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AMERICAN OUTDOORS BRANDS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended January 31, 2026 and 2025

Revenue Recognition

We recognize revenue for the sale of our products at the point in time when the control of ownership has transferred to the customer. The transfer of control typically occurs at a point in time based on consideration of when the customer has (i) a payment obligation, (ii) physical possession of goods has been received, (iii) legal title to goods has passed, (iv) risks and rewards of ownership of goods has passed to the customer, and (v) the customer has accepted the goods. The timing of revenue recognition occurs either on shipment or delivery of goods based on contractual terms with the customer, as this is when transfer of control occurs and the customer accepts the product, has title and significant risks and rewards of ownership of the product, and physical possession of the product has been transferred. Revenue recorded excludes sales tax charged to retail customers as we are considered a pass-through conduit for collecting and remitting sales taxes.

The duration of contractual arrangements with customers in our wholesale channels is typically less than one year. Payment terms with customers are typically between 20 and 90 days, with a discount available in certain cases for early payment. For contracts with discounted terms, we determine the transaction price upon establishment of the contract that contains the final terms of the sale, including the description, quantity, and price of each product purchased. We estimate variable consideration relative to the amount of cash discounts to which customers are likely to be entitled. In some instances, we provide longer payment terms, particularly as it relates to our hunting dating programs, which represent payment terms due in the fall for certain orders of hunting products received in the spring and summer. We do not consider these extended terms to be a significant financing component of the contract because the payment terms are less than one year.

We have elected to treat all shipping and handling activities as fulfillment costs and recognize the costs as distribution expenses at the time we recognize the related revenue. Shipping and handling costs billed to customers are included in net sales.

We sponsor direct-to-consumer customer loyalty programs. Customers earn rewards from qualifying purchases or activities. We defer revenue for a portion of the transaction price from product sales to customers that earn loyalty points.

The amount of revenue we recognize reflects the expected consideration to be received for providing the goods or services to customers, which includes estimates for variable consideration. Variable consideration includes allowances for trade term discounts, volume incentives, chargebacks, and product returns. Estimates of variable consideration are determined at contract inception and are constrained to the extent that the inclusion of such variable consideration could result in a significant reversal of cumulative revenue in future periods. We apply the portfolio approach as a practical expedient and utilize the expected value method in determining estimates of variable consideration, based on evaluations of specific product and customer circumstances, historical and anticipated trends, and current economic conditions. We have co-op advertising program expense, which we record within advertising expense, in recognition of a distinct service that we receive from our customers at the retail level.

Disaggregation of Revenue

The following table sets forth certain information regarding trade channel net sales for the three months ended January 31, 2026 and 2025 (dollars in thousands):


	2026		2025		$ Change		% Change
e-commerce channel net sales	$	25,976	$	27,234	$	(1,258)	(4.6	%)
Traditional channel net sales	30,600		31,271		(671)		(2.1	%)
Total net sales	$	56,576	$	58,505	$	(1,929)	(3.3	%)

Our e-commerce channel includes net sales from customers that do not traditionally operate a physical brick-and-mortar store, but generate the majority of their revenue from consumer purchases at their retail websites. Our e-commerce channel also includes our direct-to-consumer sales. Our traditional channel includes customers that operate

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AMERICAN OUTDOORS BRANDS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended January 31, 2026 and 2025

primarily out of physical brick and mortar stores and generate the large majority of their revenue from consumer purchases at their brick-and-mortar locations.

We sell our products worldwide. The following table sets forth certain information regarding geographic makeup of net sales for the three months ended January 31, 2026 and 2025 (dollars in thousands):


	2026		2025		$ Change		% Change
Domestic net sales	$	54,236	$	56,172	$	(1,936)	(3.4	%)
International net sales	2,340		2,333		7		0.3	%
Total net sales	$	56,576	$	58,505	$	(1,929)	(3.3	%)

The following table sets forth certain information regarding net sales in our shooting sports and outdoor lifestyle categories for the three months ended January 31, 2026 and 2025 (dollars in thousands):


	2026		2025		$ Change		% Change
Shooting sports net sales	$	21,249	$	24,997	$	(3,748)	(15.0	%)
Outdoor lifestyle net sales	35,327		33,508		1,819		5.4	%
Total net sales	$	56,576	$	58,505	$	(1,929)	(3.3	%)

The following table sets forth certain information regarding trade channel net sales for the nine months ended January 31, 2026 and 2025 (dollars in thousands):


	2026		2025		$ Change		% Change
e-commerce channel net sales	$	57,089	$	68,017	$	(10,928)	(16.1	%)
Traditional channel net sales	86,388		92,363		(5,975)		(6.5	%)
Total net sales	$	143,477	$	160,380	$	(16,903)	(10.5	%)

We sell our products worldwide. The following table sets forth certain information regarding geographic makeup of net sales for the nine months ended January 31, 2026 and 2025 (dollars in thousands):


	2026		2025	$ Change	% Change
Domestic net sales	$	136,483	$

SEC Form 10-Q filed by American Outdoor Brands Inc.