BRC (BRCC) Q1 2025 earnings summary

Executive summary

• Net revenue for Q1 2025 declined 8.6%–9% year-over-year to $90.0 million, with a net loss of $7.8 million compared to net income of $1.9 million in Q1 2024; results aligned with expectations despite tariffs and macro challenges.

• Gross margin fell to 36%–36.1% from 42.9%–43% year-over-year, driven by trade/pricing investments, green coffee inflation, and loyalty rewards changes.

• Wholesale and DTC channels saw revenue declines, while Outpost revenue grew modestly; distribution gains achieved across categories.

• Focus remains on long-term growth, scaling the brand, deepening retail partnerships, and disciplined investment.

• Continued commitment to community support through donations to military and first responders.

Financial highlights

• Q1 2025 revenue was $90.0 million, down 8.6%–9% year-over-year, with gross profit of $32.5 million (down 23%).

• Adjusted EBITDA was $0.9 million, a decrease of $11.6 million year-over-year.

• Net loss for Q1 2025 was $7.8 million, compared to net income of $1.9 million in Q1 2024.

• Wholesale revenue was $56.8 million, down 6% year-over-year, but up 9% excluding barter.

• DTC revenue declined 15% to $27.7 million, impacted by loyalty rewards accrual and lower customer acquisition.

Outlook and guidance

• Full-year 2025 revenue guidance is $395M–$425M, representing 1%–9% growth, with sequential improvement expected after Q1.

• Adjusted EBITDA guidance is $20M–$30M, with limited EBITDA in the first half and ramp in the second half.

• Gross margin guidance lowered to 35%–37% for the year, down from prior 37%–39% estimate, due to tariffs and coffee inflation.

• Non-recurring revenue impacts from barter and loyalty reserve benefits will not recur in 2025.

• Three-year targets include 10%–15% revenue CAGR and 40%+ gross margin by 2027.