RYTHM Q1 Revenue $13.3M, +24% Seq; Net Income $19.9M
RYTHM, Inc. announced strong financial results for the first quarter ended March 31, 2026, with revenue from continuing operations increasing 24% sequentially to $13.3 million and gross profit reaching $10.4 million, or 78% of revenue. The company reported a net income of $19.9 million, primarily driven by a $25.6 million non-cash income tax benefit, and achieved approximately breakeven Adjusted EBITDA with $1.0 million in cash flow from operations. RYTHM also amended its brand intellectual property license agreements to establish fixed annual cash licensing fees of $70 million and launched new products, including 1777 by Señorita. For the second quarter of 2026, the company anticipates revenues of approximately $22 million, representing 65% sequential growth.
Key Highlights
- Q1 Revenue from continuing operations was $13.3 million, up 24% sequentially.
- Gross profit from continuing operations reached $10.4 million, or 78% of revenue.
- Net income from continuing operations was $19.9 million, due to a $25.6 million non-cash income tax benefit.
- Adjusted EBITDA was approximately breakeven, with cash flow from operations at $1.0 million.
- Cash balance stood at $33.3 million at quarter end.
- Amended brand IP license agreements set fixed annual cash licensing fees of $70 million.
- Company expects Q2 2026 revenues of approximately $22 million, a 65% sequential growth.
- Approximately 2.1 million shares outstanding at quarter end.