GrowGeneration Reports First Quarter 2026 Financial Results
Rhea-AI Summary
GrowGeneration (NASDAQ: GRWG) reported Q1 2026 net sales of $38.4 million, up 7.5% year-over-year, led by commercial B2B.
Net loss improved to $4.9 million, Adjusted EBITDA loss to $1.6 million, proprietary brands reached 37% of Cultivation & Gardening revenue, and 2026 guidance was reaffirmed.
AI-generated analysis. Not financial advice.
Positive
- Net sales rose 7.5% year-over-year to $38.4 million in Q1 2026
- Storage Solutions segment net sales increased to $6.5 million from $4.8 million
- Proprietary brands reached 37.0% of Cultivation & Gardening net sales, up from 32.0%
- Total operating expenses fell 23.4% to $15.0 million
- Store and other operating expenses declined 27.2% to $6.4 million
- GAAP net loss improved by $4.5 million to $4.9 million
- Adjusted EBITDA loss improved by $2.4 million to $1.6 million
- Cash, cash equivalents, and marketable securities totaled $41.1 million with no debt
- 2026 revenue outlook reaffirmed at $162–$168 million with breakeven Adjusted EBITDA expected
- Q2 2026 net sales guidance set at $42–$44 million, implying sequential growth
Negative
- Company remained unprofitable with a GAAP net loss of $4.9 million in Q1 2026
- Gross margin declined to 25.4% from 27.2% year-over-year
- Adjusted EBITDA remained negative at a $1.6 million loss
- Four retail locations were closed in Q1 2026 as part of network optimization
News Market Reaction – GRWG
On the day this news was published, GRWG gained 17.52%, reflecting a significant positive market reaction. Argus tracked a peak move of +12.6% during that session. Our momentum scanner triggered 29 alerts that day, indicating elevated trading interest and price volatility. This price movement added approximately $14M to the company's valuation, bringing the market cap to $96.75M at that time.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Market Reality Check
Peers on Argus
Sector peers were generally weak, with names like LESL, BARK, RECT and ONEW down between 4–9%, while GRWG was down 1.41% ahead of results, indicating stock-specific factors rather than a clean sector trend.
Previous Earnings Reports
| Date | Event | Sentiment | Move | Catalyst |
|---|---|---|---|---|
| Mar 19 | Full-year 2025 results | Positive | +6.4% | Improved 2025 profitability, higher gross margin, narrower net loss and 2026 guidance. |
| Nov 06 | Q3 2025 earnings | Positive | +28.3% | Q3 2025 net sales, positive Adjusted EBITDA and stronger proprietary brand mix. |
| Aug 11 | Q2 2025 earnings | Positive | +18.3% | Q2 2025 sales growth, margin expansion, reduced net loss and solid cash balance. |
| May 08 | Q1 2025 earnings | Negative | -15.4% | Revenue decline from closures, larger loss and withdrawal of full-year 2025 guidance. |
| Mar 13 | Full-year 2024 results | Neutral | +7.9% | 2024 results with lower gross margin, higher net loss and cautious 2025 outlook. |
Earnings releases have often triggered sizable positive moves when they show margin or EBITDA improvement, but weak top-line trends have led to sharp selloffs.
Across recent earnings, GrowGeneration has emphasized tightening its cost base, growing proprietary brands and working back toward profitability. Q1 2025 saw sales fall and guidance withdrawn, and the stock dropped 15.45%. Subsequent quarters highlighted improving gross margins, lower operating expenses and rising proprietary mix, with earnings reactions of 6–28% gains. The latest Q1 2026 report continues this theme of moderate revenue growth, higher proprietary penetration and narrowed losses against a leaner footprint.
Historical Comparison
Over the last five earnings reports, GRWG’s average absolute move was 9.08%, showing that earnings have typically been meaningful trading catalysts.
Earnings updates show a shift from 2024’s larger losses toward 2025 margin gains, higher proprietary brand mix, and 2026 guidance targeting breakeven Adjusted EBITDA.
Market Pulse Summary
The stock surged +17.5% in the session following this news. A strong positive reaction aligns with prior earnings, where moves around 9% were common following margin and cost improvements. Q1 2026 combined 7.5% revenue growth, proprietary mix at 37.0%, and a narrower $4.9M net loss. Investors would still need to track execution on the reaffirmed $162–$168M revenue and breakeven Adjusted EBITDA targets.
Key Terms
adjusted EBITDA financial
basis points financial
non-GAAP financial
AI-generated analysis. Not financial advice.
Second Consecutive Quarter of Year-Over-Year Revenue Growth driven by Commercial B2B Sales
Net Loss Improved by
Proprietary Brand Penetration Increased 500 Basis Points Year-Over-Year to
Company Reaffirms 2026 Outlook: Revenue of
DENVER, May 12, 2026 (GLOBE NEWSWIRE) -- GrowGeneration Corp. (NASDAQ: GRWG) (“GrowGeneration,” “GrowGen,” or the “Company”), one of the nation’s largest suppliers of specialty products for controlled environment agriculture (CEA), commercial cultivation, and retail garden centers, today announced financial results for the first quarter of 2026.
First Quarter 2026 Summary
- Net sales of
$38.4 million , up7.5% year-over-year; - Proprietary brand sales as a percentage of Cultivation and Gardening net sales increased to
37.0% , compared to32.0% in the first quarter of 2025; - Gross profit margin of
25.4% , compared to27.2% for the first quarter of 2025; - Store and other operating expenses declined approximately
27.2% to$6.4 million , compared to$8.8 million for the same period in the prior year; - Total operating expenses decreased
$4.6 million , or23.4% , to$15.0 million in the first quarter of 2026, compared to$19.6 million for the same period in the prior year; - Net loss was
$4.9 million compared to a net loss of$9.4 million for the same period in 2025; - Adjusted EBITDA(1) loss of
$1.6 million compared to a loss of$4.0 million for the comparable prior year period; and - Cash, cash equivalents, and marketable securities of
$41.1 million and no debt.
Darren Lampert, GrowGen’s Co-Founder and Chief Executive Officer, commented, “We delivered a solid start to 2026, with first quarter revenue exceeding our expectations despite this typically being our seasonally slowest period. This marks our second consecutive quarter of year-over-year revenue growth, driven by continued strength in our commercial B2B division and the benefits of a more focused operating footprint. Importantly, the structural actions we have taken to streamline our cost base are translating into meaningful financial improvement, with a
“We also continue to make strong progress on our strategic priorities, with proprietary brand penetration reaching
First Quarter 2026 Consolidated Results
Net sales were
Once again, our quarterly proprietary brand sales exceeded our internal expectations, giving us further confidence in our ability to expand gross margin for the long-term. Proprietary brand sales as a percentage of Cultivation and Gardening net sales increased to
Gross profit was
Total operating expenses, which include store operations and other operational expenses, selling, general, and administrative, estimated credit losses, and depreciation and amortization expense decreased in the first quarter of 2026 by
Store and other operating expenses in the first quarter of 2026 declined by approximately
Selling, general, and administrative expenses in the first quarter of 2026 were
GAAP net loss narrowed to
Non-GAAP Adjusted EBITDA(1) was a loss of
Cash, cash equivalents, and marketable securities as of March 31, 2026 were
Total current liabilities, including accounts payable, accrued payroll, and other liabilities as of March 31, 2026 were
Geographic Footprint
Our geographic footprint for our Cultivation and Gardening segment spans 492,000 square feet of retail and warehouse space and includes 19 retail locations across 9 states as of March 31, 2026. We closed four retail locations during the three months ended March 31, 2026 as part of our ongoing network optimization strategy. We continue to serve our customers through our other retail locations and our online platforms, such as growgeneration.com and GrowGen.Pro, our dedicated B2B commercial portal serving multi-state operators, controlled environment agriculture and greenhouse customers, wholesale partners, and independent commercial cultivators.
2026 Outlook
For the full year 2026, the Company reaffirmed that it expects net revenue in the range of
The Company’s full year 2026 guidance assumes profitability will build progressively throughout the year, with profitable second and third quarters reflecting the outdoor cultivation and gardening season as well as continued improvements in gross margin and a lower operating expense base compared to 2025.
For the second quarter of 2026, the Company expects total consolidated net sales in the range of
| Footnotes | |
| (1) | Adjusted EBITDA represents earnings before interest, taxes, depreciation, and amortization as adjusted for certain items as set forth in the reconciliation table of U.S. GAAP to non-GAAP information and is a measure calculated and presented on the basis of methodologies other than in accordance with GAAP. Please refer to the Use of Non-GAAP Financial Information herein for further discussion and reconciliation of this measure to GAAP measures. |
Conference Call
The Company will host a conference call today, May 12, 2026, at 4:30 p.m. Eastern Time to discuss financial results for the first quarter ended March 31, 2026. To participate in the call, please dial 1-(888)-699-1199 (domestic) or 1-(416)-945-7677 (international). The conference code is 98549. The call will also be webcast and can be accessed at https://app.webinar.net/BV1vzDxzAqQ or on the Investor Relations section of the GrowGen website at: https://ir.growgeneration.com. A replay of the webcast will be available approximately two hours after the conclusion of the call and remain available for approximately 90 calendar days.
About GrowGeneration Corp:
GrowGen is one of the nation’s largest suppliers of specialty products for controlled environment agriculture (CEA), commercial cultivation, and retail garden centers. GrowGen carries and sells thousands of products, such as nutrients, additives, growing media, lighting, environmental control systems, and benching and racking, including proprietary brands such as Char Coir, Drip Hydro, Power Si, Ion lights, The Harvest Company, and more. The Company also operates an online superstore for cultivators at growgeneration.com, as well as a wholesale business for resellers, and a benching, racking, and storage solutions business, MMI Storage Solutions.
To be added to the GrowGeneration email distribution list, please email GrowGen@kcsa.com with GRWG in the subject line.
Forward Looking Statements
This press release contains predictions, estimates or other information that are considered forward-looking statements, including without limitation, statements regarding the Company’s financial outlook, guidance, and strategic expectations, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and is intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. When used herein, words such as “look forward,” “expect,” “believe,” “anticipate,” “estimate,” “guidance,” “outlook,” “projected,” “intend,” “may,” or variations of such words and similar expressions are intended to identify forward-looking statements. These forward-looking statements represent management’s current expectations and are based on assumptions and estimates that management believes are reasonable as of the date of this press release. You are cautioned not to place undue reliance on these forward-looking statements. Actual results may differ materially from those anticipated due to a number of risks and uncertainties, including but not limited to those discussed in filings made with the United States Securities and Exchange Commission, available at: www.sec.gov, and on the Company’s website, at: www.growgeneration.com. The Company does not undertake any obligation to revise or publicly release the results of any revision to these forward-looking statements, except as required by applicable securities laws, whether as a result of new information, future events, or otherwise.
Contacts:
KCSA Strategic Communications
Philip Carlson
Managing Director
T: 212-896-1233
E: GrowGen@kcsa.com
| GROWGENERATION CORP. AND SUBSIDIARIES | |||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||
| (Unaudited, in thousands, except shares) | |||||||
| March 31, 2026 | December 31, 2025 | ||||||
| ASSETS | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 21,679 | $ | 30,406 | |||
| Marketable securities | 19,440 | 15,658 | |||||
| Accounts receivable, net of allowance for credit losses of | 13,999 | 10,668 | |||||
| Notes receivable, current, net of allowance for credit losses of | 495 | 507 | |||||
| Inventory | 36,953 | 38,776 | |||||
| Prepaid income taxes | 60 | 60 | |||||
| Prepaid and other current assets | 7,062 | 7,672 | |||||
| Total current assets | 99,688 | 103,747 | |||||
| Property and equipment, net | 9,034 | 9,795 | |||||
| Operating leases right-of-use assets, net | 25,191 | 27,050 | |||||
| Intangible assets, net | 2,569 | 3,326 | |||||
| Goodwill | 2,080 | 2,080 | |||||
| Other assets | 1,016 | 1,042 | |||||
| TOTAL ASSETS | $ | 139,578 | $ | 147,040 | |||
| LIABILITIES & STOCKHOLDERS' EQUITY | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 9,582 | $ | 8,775 | |||
| Accrued liabilities | 3,857 | 3,269 | |||||
| Payroll and payroll tax liabilities | 1,858 | 2,589 | |||||
| Customer deposits | 2,643 | 4,015 | |||||
| Sales tax payable | 840 | 872 | |||||
| Current maturities of operating lease liabilities | 5,831 | 6,455 | |||||
| Total current liabilities | 24,611 | 25,975 | |||||
| Operating lease liabilities, net of current maturities | 21,627 | 23,022 | |||||
| Other long-term liabilities | 508 | 544 | |||||
| Total liabilities | 46,746 | 49,541 | |||||
| Commitments and contingencies | |||||||
| Stockholders' equity: | |||||||
| Common stock; | 60 | 60 | |||||
| Additional paid-in capital | 377,383 | 377,128 | |||||
| Accumulated deficit | (284,611 | ) | (279,689 | ) | |||
| Total stockholders' equity | 92,832 | 97,499 | |||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 139,578 | $ | 147,040 | |||
| GROWGENERATION CORP. AND SUBSIDIARIES | |||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||
| (Unaudited, in thousands, except per share amounts) | |||||||
| Three Months Ended March 31, | |||||||
| 2026 | 2025 | ||||||
| Net sales | $ | 38,391 | $ | 35,703 | |||
| Cost of sales (exclusive of depreciation and amortization shown below) | 28,651 | 25,996 | |||||
| Gross profit | 9,740 | 9,707 | |||||
| Operating expenses: | |||||||
| Store operations and other operational expenses | 6,401 | 8,792 | |||||
| Selling, general, and administrative | 6,926 | 7,112 | |||||
| Estimated credit losses | 67 | 92 | |||||
| Depreciation and amortization | 1,611 | 3,585 | |||||
| Total operating expenses | 15,005 | 19,581 | |||||
| Loss from operations | (5,265 | ) | (9,874 | ) | |||
| Other income: | |||||||
| Interest income | 324 | 497 | |||||
| Total other income | 324 | 497 | |||||
| Net loss before income taxes | (4,941 | ) | (9,377 | ) | |||
| Benefit for income taxes | 19 | — | |||||
| Net loss | $ | (4,922 | ) | $ | (9,377 | ) | |
| Net loss per share, basic | $ | (0.08 | ) | $ | (0.16 | ) | |
| Net loss per share, diluted | $ | (0.08 | ) | $ | (0.16 | ) | |
| Weighted average shares outstanding, basic | 60,090,905 | 59,441,330 | |||||
| Weighted average shares outstanding, diluted | 60,090,905 | 59,441,330 | |||||
Use of Non-GAAP Financial Information
The following non-GAAP financial measures of EBITDA and Adjusted EBITDA are not in accordance with, or an alternative for, generally accepted accounting principles ("GAAP") and should be considered in addition to, and not as a substitute for, the most directly comparable GAAP financial measures. We believe these non-GAAP financial measures, when used in conjunction with their most directly comparable GAAP financial measures, net income (loss), provide meaningful supplemental information to both management and investors, facilitating the evaluation of performance across reporting periods, identify trends affecting our business, and project future performance. Management uses these non-GAAP financial measures for internal planning and reporting purposes, and we believe that these non-GAAP financial measures may be useful to investors in their assessment of our operating performance, our ability to generate cash, and valuation. In addition, these non-GAAP financial measures address questions routinely received from analysts and investors and, in order to ensure that all investors have access to the same data, we have determined that it is appropriate to make this data available to all investors. These non-GAAP financial measures may be different from non-GAAP financial measures used by other companies.
EBITDA and Adjusted EBITDA
EBITDA and Adjusted EBITDA are non-GAAP financial measures commonly used in our industry and should not be construed in isolation as substitutions to net income (loss) as indicators of operating performance or as alternatives to cash flow provided by operating activities as a measure of liquidity (each as determined in accordance with GAAP). GrowGeneration defines EBITDA as net income (loss) before interest income, interest expense, income tax expense, depreciation and amortization, and Adjusted EBITDA as further adjusted to exclude certain items such as stock-based compensation, impairment losses, restructuring and corporate rationalization costs, and other non-core or non-recurring expenses and to include income from our marketable securities as these investments are part of our operational business strategy and increase the cash available to us.
Set forth below is a reconciliation of EBITDA and Adjusted EBITDA to net loss (in thousands):
| Three Months Ended March 31, | |||||||
| 2026 | 2025 | ||||||
| Net loss | $ | (4,922 | ) | $ | (9,377 | ) | |
| Benefit for income taxes | (19 | ) | — | ||||
| Interest income | (324 | ) | (497 | ) | |||
| Depreciation and amortization | 1,611 | 3,585 | |||||
| EBITDA | $ | (3,654 | ) | $ | (6,289 | ) | |
| Share-based compensation | 255 | 503 | |||||
| Investment income | 300 | 519 | |||||
| Restructuring plan | — | 1,141 | |||||
| Consolidation and other charges (1) | 1,515 | 96 | |||||
| Adjusted EBITDA | $ | (1,584 | ) | $ | (4,030 | ) | |
| (1) Consists primarily of expenditures related to legal settlements and contingencies, the activity of store and distribution consolidation, one-time severances outside of the restructuring plan announced July 2024, and other non-core or non-recurring expenses | |||||||
