BRP Inc. (NASDAQ: DOOO) Q1 2026 Earnings Call | 5/29/2025

23 days ago

59:52

Inside Ticker

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BRP Inc. reported Q1 fiscal 2026 results in line with expectations, despite a challenging macroeconomic environment marked by uncertainty and tariffs impacting consumer confidence. Revenues were $1.84 billion, down 8%, with normalized EBITDA at $201 million, normalized EPS at $0.22, and strong free cash flow of $162 million CAD. North American powersports retail sales were flat, outperforming the industry (down low single digits), driven by an 80%+ surge in snowmobile sales due to favorable late-winter conditions. Globally, retail trends were mixed: Canada up 23%, Latin America up 18%, but EMEA and APAC down 22% and 14%, respectively. Year-round product revenues fell 10% to $1.1 billion, with Can-Am side-by-side retail down 10% but market share grew 4% in current units. Seasonal product revenues dropped 12.7% to $278 million, reflecting inventory reduction efforts, though snowmobile retail outperformed the industry. Parts, accessories, and apparel revenue rose 5% to $322 million. Network inventory was reduced 21% year-over-year, with dealer credit line usage at 70%, and most inventory right-sizing is expected to be completed by Q2-end, aligning wholesale with retail in Q4. Tariffs are projected to have a $35–$40 million CAD gross impact, primarily on P&A, but BRP aims to mitigate most through supplier adjustments and pricing strategies. No guidance was issued due to demand uncertainty, but a stronger Q4 is anticipated with new product launches and double-digit top-line growth if retail trends hold. BRP’s balance sheet remains solid with $700 million CAD in cash. José Boisjoli announced his retirement by fiscal year-end, with a global CEO search underway, and BRP’s design team was named Red Dot Design Team of the Year 2025. The company is positioned for growth with a lean inventory, strong product pipeline, and operational agility.

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BRP Inc. (NASDAQ: DOOO) reported Q1 2026 results on May 29, 2025, beating earnings expectations with normalized EPS of $0.47, well above analyst estimates. Revenue fell 7.7% year-over-year to $1.8 billion as the company faced softer consumer demand, deliberate shipment reductions in Seasonal Products, and a challenging macroeconomic environment. Gross profit dropped 24% to $395 million, with gross margin compressing to 21.4% due to less efficient asset use, higher sales programs, and unfavorable product mix. Despite these pressures, BRP generated $162 million in free cash flow and ended the quarter with over $300 million in cash, reinforcing its financial flexibility. The quarter saw strong snowmobile retail sales in Canada (up 21%), while U.S. retail declined 6% and international markets remained soft. Year-Round Products revenue declined 4% to $1.1 billion, and Seasonal Products revenue dropped 22% to $419 million, but Parts, Accessories & Apparel grew 5% to $322 million. BRP made substantial progress on inventory rightsizing, reducing network inventory by 21% year-over-year and lowering dealer credit line usage to the lowest level in over two years, positioning the company for a potential rebound later in the year. Management continues to withhold formal guidance due to ongoing macroeconomic and tariff uncertainties but remains optimistic that new product launches and leaner inventories could drive double-digit top-line growth and improved profitability in the second half of fiscal 2026 if retail conditions stabilize. The company also declared a C$0.215 quarterly dividend and announced further progress on its marine business divestitures and CEO succession planning. About Inside Ticker: For more expert analysis and real-time updates on BRP Inc. (NASDAQ: DOOO) and other market movers, follow Inside Ticker and visit InsideTicker.com for in-depth reports, financial insights, and the latest news on leading companies. #BRP #DOOO #EarningsCall #Q12026 #Powersports #Inventory #RetailStocks #StockMarket #Investing #InsideTicker

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