Build‑A‑Bear Workshop reported record quarterly revenue of $154.5 million for its fiscal fourth quarter, a 2.7% increase from $150.4 million in the same period a year earlier. The company’s partner‑operated model, which now accounts for more than 25 % of total units, continued to drive high‑margin commercial revenue, while the direct‑to‑consumer segment maintained contribution margins above 25%.
Pre‑tax income fell to $21.5 million from $27.5 million year‑ago, a decline largely attributable to a $6 million tariff and related cost impact. Gross margin contracted to 55.2 %, down 140 basis points from the prior year, reflecting tariff‑driven cost increases, promotional spending, and a shift in product mix. SG&A expenses rose to 41.4 % of revenue from 38.4 % a year earlier, driven by higher compensation, medical costs, and inflationary pressures.
Earnings per share for the quarter were $1.26, slightly missing the consensus estimate of $1.27–$1.28. The miss was driven by the combined effect of the tariff impact and higher operating expenses, which offset the revenue growth and margin compression. Revenue also missed the consensus estimate of $154.67–$156.33 million, underscoring the impact of cost pressures on the company’s profitability profile.
Management guided for fiscal 2026 with total revenue expected to grow in the mid‑single‑digits and pre‑tax income ranging from a mid‑single‑digit decline to low‑single‑digit growth. The guidance signals confidence in continued revenue expansion through the partner‑operated and international models, while acknowledging the need to manage profitability amid ongoing cost pressures.
The company also announced a quarterly cash dividend of $0.23 per share, an increase of $0.01 from the prior dividend of $0.22. The dividend will be paid on April 9, 2026 to shareholders of record as of March 26, 2026. The dividend hike reflects Build‑A‑Bear’s commitment to returning value to shareholders while maintaining a strong balance sheet, with $27.7 million in cash and no debt on its credit facility.
During the earnings call, CEO Sharon Price John highlighted the company’s record annual revenue of over $500 million and the opening of more than 60 net new units across multiple geographies. CFO Voin Todorovic noted that the company achieved its fifth consecutive year of record revenue and pre‑tax income. COO Chris Hurt, who will become CEO effective June 11, 2026, emphasized the expansion of the partner‑operated model and the addition of 11 net new experience locations across four continents.
Investors reacted positively to the results, with the stock rising 8.48% in pre‑market trading. The market’s enthusiasm was driven by the record annual revenue, the continued growth of the partner‑operated and international segments, and the company’s ability to navigate tariff‑related cost pressures while maintaining a strong balance sheet.
The earnings release also confirmed that Build‑A‑Bear’s leadership transition is underway, with COO Chris Hurt slated to take over as CEO in June 2026, a change that may influence the company’s strategic direction and investor expectations.
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