Sep 3, 2026 earnings call — Margin improvement and inventory cleanup
Net income rose by $17.1 million to $18.4 million in Q2.
Revenue $0.1B (est $0.1B) · EPS $0.50 (est $-0.01)
Key quotes
"And the reduction in deep discounting this quarter allowed us to deliver nearly 500 basis points of operational gross margin improvement year over the prior year."
"Inventory at the end of the second quarter was $125.2 million, a reduction of $22.9 million or 15.5% compared to prior year."
"We are ramping up our upper funnel brand investments in the third quarter, to prime demand ahead of peak and capture early transitional shoppers."
Analyst Q&A 1
Q3 guidance and Alaskan Hardgear drag
Q (Dylan Carden · William Blair): He asked why guidance takes a step back in Q3 and how much the Alaskan Hardgear inventory reset is dragging versus the core business. He also asked about the timing of recovery between channels and the chance to improve inventory turns.
A: Management said Alaskan Hardgear is a relatively small part of the assortment and they have pulled it back to core products that are doing well. They expect Q3 to be better than Q2 but will not repeat prior clearance events; as management noted, their clearance inventory is down over 40% both in dollars and units, which moderates Q3 expectations. They said each quarter should improve versus the prior (Q3>Q2, Q4>Q3), online should show greater improvement than retail, and they see long-term opportunity to raise inventory turns by rationalizing SKUs and keeping core items always in stock.
"As I mentioned in the call, our clearance inventory is down over 40% both in dollars and units." — Heena Agrawal (CFO)