Grove Collaborative (GROV) Q1 2026 earnings summary

Executive summary

• Net revenue for Q1 2026 was $36.2 million, down 16.8%–17% year-over-year, but ahead of expectations and marking the expected revenue trough; positive adjusted EBITDA of $0.3 million was achieved for the second consecutive quarter.

• Gross margin expanded to 54.8%–55%, up 180 basis points year-over-year, driven by targeted promotions, loyalty program adoption, and a shift from broad discounting.

• Net loss narrowed to $1.0 million from $3.5 million year-over-year, reflecting cost reductions and improved gross margin.

• Customer experience and repeat order rates recovered to pre-migration levels following platform disruptions, supporting a measured re-acceleration of advertising investment.

• Strategic focus remains on profitable DTC growth, deepening authority in human health, and responsible advertising spend.

Financial highlights

• Gross margin improved to 54.8%–55%, up 180 basis points year-over-year, aided by targeted promotions and loyalty program incentives.

• Adjusted EBITDA was $0.3 million (0.8% margin), compared to -$1.6 million (-3.7% margin) in the prior year.

• Net loss margin improved to (2.8)% from (8.1)% year-over-year.

• Operating cash flow was -$0.7 million, a significant improvement from -$6.9 million in the prior year, mainly due to inventory build and better working capital management.

• Cash, cash equivalents, and restricted cash totaled $10.4 million at quarter-end.

Outlook and guidance

• Full-year 2026 net revenue guidance raised to $142.5–$152.5 million, with adjusted EBITDA expected at breakeven to positive low single-digit millions.

• Q1 2026 is expected to be the revenue trough, with sequential improvement anticipated in each subsequent quarter.

• Guidance reflects improved customer cohort performance, acquisition efficiency, and platform stability.