Build-A-Bear Workshop (BBW) Q3 2026 earnings summary

Executive summary

• Achieved record third-quarter revenue of $122.7 million, up 2.7% year-over-year, and record nine-month revenue of $375.3 million, up 8.5% year-over-year, with pre-tax income for the quarter at $10.7 million and EPS of $0.62, despite tariff impacts.

• Year-to-date pre-tax income rose to $45.7 million, up 15%, and EPS increased over 24% for the first three quarters.

• Opened over 50 net new experience locations year-to-date, with a focus on non-traditional and international expansion, now totaling 651 locations across 33 countries.

• Returned $26.1 million to shareholders through share repurchases and dividends in the first nine months, with over $160 million returned since 2021.

• Continued focus on experiential retail, digital transformation, and leveraging brand equity.

Financial highlights

• Q3 total revenue: $122.7 million, up 2.7% year-over-year; net retail sales: $112.3 million, up 2.5%; commercial and international franchising revenues combined were $10.4 million, up 4.9%.

• Gross margin for the quarter was 53.7%, down 40 basis points; SG&A expenses increased to $55.3 million, or 45.1% of revenue.

• EBITDA for the quarter was $14.2 million (11.6% margin), down 14.6% year-over-year; nine-month EBITDA was $56.1 million (15.0% margin), up 12.5%.

• Cash and equivalents at quarter-end were $27.7 million; inventory increased to $83.3 million, reflecting tariff costs and commercial growth.

• Returned $26.1 million to shareholders year-to-date via dividends and buybacks; $70 million remains under repurchase authorization.

Outlook and guidance

• Reaffirmed full-year and 2025 guidance for revenue, pre-tax income, and net-new-unit growth, expecting to surpass $500 million in annual revenue for the first time.

• Q4 revenue expected to grow ~2%, with commercial segment growth of at least 30%; full-year commercial segment growth expected to exceed 20%.

• Pre-tax income guidance midpoint for Q4 is ~$20 million; total annual tariff impact expected to be under $11 million.

• Net-new-unit growth of at least 60 locations anticipated; capital expenditures projected at $20–$25 million.

• Guidance factors in tariffs, medical and labor costs, freight, and inflation; no further material changes in tariffs or macroeconomic conditions assumed.