Reed's Q1 Net Sales $7.1M, Gross Profit $0.7M; Net Loss Widens to $6.5M
Reed's, Inc. reported significantly weaker financial results for Q1 2026, with net sales falling to $7.1 million from $10.0 million year-over-year, and gross profit plummeting to $0.7 million from $3.4 million. The company's net loss widened substantially to $6.5 million compared to $2.0 million in Q1 2025. Interim CEO Neal Cohane attributed the poor performance to transitional factors like inventory rationalization, elevated SG&A, and softer sales execution, emphasizing that these are being addressed through corrective actions. The company has initiated several measures, including strengthening customer relationships, optimizing inventory, expanding e-commerce, restructuring Amazon operations, reducing headcount, and appointing Damian Warshall as COO, to stabilize the business and drive profitable growth.
Key Highlights
- Net sales decreased 29% to $7.1 million in Q1 2026 from $10.0 million in Q1 2025.
- Gross profit fell 79.4% to $0.7 million, with gross margin at 10% compared to 34% YoY.
- Net loss widened to $6.5 million, or $(0.55) per share, from $2.0 million, or $(0.27) per share.
- EBITDA was a loss of $(6.2) million, compared to a loss of $(1.7) million in Q1 2025.
- Selling, general and administrative expenses increased 65.7% to $5.8 million.
- Cash used in operations was $5.8 million, up from $5.4 million in the prior year.
- Cash balance at March 31, 2026, was $4.6 million, down from $10.4 million at Dec 31, 2025.
- Damian Warshall was appointed Chief Operating Officer to lead operational and commercial initiatives.