Clarus Raises 2026 Guidance as Q3 Outdoor Growth Lifts Margins

Clarus Corporation (NASDAQ: CLAR) raised its fiscal 2026 guidance after third-quarter profitability improved sharply, as growth and margin gains in its Outdoor segment more than offset a 20.2% revenue decline in Adventure. The company’s results also benefited from recovered tariffs, which contributed $0.6 million to quarterly adjusted EBITDA.

Revenue for the quarter ended September 30 rose 2.7% year over year to $71.2 million from $69.3 million. Reported gross margin expanded to 41.0% from 35.1%, including an approximately 80-basis-point benefit from the recovery of International Emergency Economic Powers Act tariffs. Adjusted gross margin was 41.1%, compared with 35.1% a year earlier.

Adjusted EBITDA increased to $6.8 million from $1.8 million, while adjusted EBITDA margin rose to 9.6% from 2.6%. Clarus said its strategy remains focused on simplifying the Outdoor business, strengthening pricing and customer mix in Adventure, and maintaining disciplined capital allocation.

Outdoor growth drives quarterly performance

Outdoor revenue increased 12.4% to $54.7 million, and the segment generated $8.0 million of adjusted EBITDA. Sales across its three largest business units—Mountain, Climb and Apparel—grew approximately 13% and continued to represent more than 90% of segment sales.

Mountain sales rose about 15%, supported by a collaboration with Norda footwear. North American digital direct-to-consumer sales increased approximately 16%, with the company also reporting healthier margins. European wholesale delivered a second consecutive quarter of double-digit growth, rising about 13% in U.S. dollar terms and roughly 10% in constant currency.

Excluding the tariff refund, Outdoor gross margin improved 440 basis points to 40.4%. Clarus attributed the gain to better inventory quality, a greater focus on its most profitable categories and reduced discounting. Management said the segment’s simplification strategy centers on concentrating resources on fewer, larger product opportunities.

Adventure maintains profitability despite lower sales

Adventure revenue declined 20.2% to $16.5 million, but the segment produced $0.8 million of adjusted EBITDA. Excluding a $0.5 million tariff refund, adjusted EBITDA was in line with the prior-year period despite the lower sales volume.

Gross margin, excluding the refund, expanded 640 basis points year over year. Clarus said pricing actions, an improved customer and product mix, and reduced promotional activity supported the increase.

The company also reported progress with key retail partners, including Supercheap Auto. In the Americas, Rhino-Rack’s U.S. sales were strong and its margin more than doubled from a year earlier. Adventure also added European original-equipment relationships with Bentley, Porsche, Jaguar Land Rover’s Defender and Mercedes. Clarus said the segment has a pipeline of new products planned across its brands in 2027.

Fiscal 2026 outlook

Clarus now expects fiscal 2026 net sales of $251 million to $255 million and adjusted EBITDA of $15 million to $17 million, implying a 6.3% adjusted EBITDA margin at the midpoint. The adjusted EBITDA forecast includes $6.7 million of tariff-recovery benefits, comprising $6.2 million for Outdoor and $0.5 million for Adventure.

The company projects adjusted corporate costs of $6 million to $7 million, capital expenditures of approximately $9 million and free cash flow around break-even for the year. For the fourth quarter, management expects revenue of $62 million to $66 million and adjusted EBITDA of approximately $3 million.

Clarus ended the third quarter debt-free with $20.8 million of cash. It said it remains committed to operational and organizational progress despite a challenging macroeconomic environment.

The outlook remains subject to risks associated with the company’s review of strategic alternatives, including its timing, outcome and potential effects on operations. Clarus also cautioned that there is no assurance the review will result in a transaction or another strategic outcome. The company did not provide GAAP reconciliations for its full-year adjusted EBITDA, adjusted EBITDA margin or free-cash-flow guidance, citing the difficulty of forecasting certain expenses and gains without unreasonable effort.