BRC Q1 revenue rises, driven by wholesale, DTC growth

Overview

• U.S. premium coffee seller's Q1 revenue rose 21% yr/yr, driven by wholesale and DTC growth

• Net income reached breakeven, while adjusted EBITDA rose sharply from prior year

• Gross margin declined due to coffee inflation, tariffs, and a non-cash write-down

Outlook

• BRC expects at least 8% revenue growth for full-year 2026

• Company raises full-year Adjusted EBITDA growth outlook to at least 35%

• BRC maintains full-year gross margin guidance of 34% to 36%

Result Drivers

• WHOLESALE EXPANSION - Revenue growth in wholesale channel was driven by expanded packaged coffee distribution and higher unit volumes, along with pricing

• DTC MARKETPLACE GROWTH - Direct-to-consumer revenue growth was led by increased sales through third-party digital retail marketplaces

• GROSS MARGIN PRESSURE - Gross margin declined due to green coffee inflation, tariffs, and a non-cash write-down of raw material inputs related to a formulation change

Company press release: ID:nBwQ8lx0a

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 2 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the food processing peer group is "buy"

• Wall Street's median 12-month price target for BRC Inc is $2.50, about 129.4% above its May 1 closing price of $1.09

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