Taurus Armas (TASA4) Q1 2026 earnings summary

Executive summary

• Net operating revenue reached R$354.9 million in 1Q26, up 1.7% year-over-year, despite a challenging environment and a 50% U.S. import tariff in effect until late February.

• Gross profit was R$100.1 million, with a gross margin of 28.2%, down from 32.3% in 1Q25 due to lower volumes and fixed cost dilution.

• EBITDA was negative at R$20.1 million, impacted by non-recurring legal settlement expenses in the U.S. and adverse currency effects.

• Net loss for the quarter was R$36.6 million, compared to net income of R$18.6 million in 1Q25.

• The end of the U.S. tariff and an estimated US$18 million refund are expected to improve future cash flow and profitability.

Financial highlights

• Net operating revenue: R$354.9 million (+1.7% YoY, -9.3% QoQ).

• Gross margin: 28.2% (down from 32.3% in 1Q25 and 34.9% in 4Q25).

• Operating expenses rose 15.4% YoY, mainly due to a non-recurring legal settlement in the U.S.

• Net financial income was R$7.9 million, down from R$20.6 million in 1Q25, but improved from a net expense in 4Q25.

• Net debt: R$541.1 million, down 5.4% from year-end 2025.

Outlook and guidance

• The removal of the U.S. tariff and expected refund are set to boost cash flow, reduce debt, and improve EBITDA and net income in coming quarters.

• Order backlog of nearly US$100 million and signs of demand recovery in the U.S. support a positive outlook.

• Continued focus on operational efficiency, innovation, international expansion, and defense sector growth, including new contracts in India and potential acquisition in Turkey.