Johnson Outdoors (NASDAQ:JOUT) executives said the company got off to an encouraging start in fiscal 2026, citing stabilizing markets, solid reception for new products, and ongoing progress on profitability initiatives. On its fiscal first-quarter earnings call, Chair and CEO Helen Johnson-Leipold said the quarter produced “double-digit growth,” a notable development because it is typically a slower period ahead of the company’s primary selling season.
Chief Financial Officer David Johnson reported a significantly narrower loss versus the prior-year quarter, driven largely by higher revenue and improved margins. Management also pointed to healthier trade conditions, growing e-commerce momentum, and continued emphasis on innovation and cost savings as key priorities for the year.
Management cites stabilizing markets and strong new-product reception
While acknowledging uncertainty in the broader environment, Johnson-Leipold said the company feels good about its execution and plans to accelerate growth across its business and brands. She outlined priorities that remain consistent across the portfolio:
- Maintaining a strong innovation pipeline
- Building momentum in digital and e-commerce
- Improving product costs and operating efficiency through cost savings initiatives
Segment commentary: Fishing, camping and watercraft, and diving
In fishing, Johnson-Leipold said both Minn Kota and Humminbird delivered solid performance, with the category benefiting from “improved trade dynamics.” She highlighted continued demand for Humminbird’s XPLORE Series and MEGA Live 2 fish finders, which launched last fiscal year, and said Minn Kota saw healthy demand across its trolling motor lineup.
In camping and watercraft, she said investments in digital and e-commerce are “really paying off.” The company has focused on meeting consumers online and making it easier for them to discover and purchase products, which helped drive growth in the quarter. She described Old Town and Jetboil as leaders in their markets and said demand for Jetboil’s fast-boil cooking systems has exceeded expectations.
In diving, Johnson-Leipold said improved global market conditions and innovation contributed to higher quarterly sales. She noted positive momentum for SCUBAPRO’s HYDROS PRO 2, which began shipping in December, and described it as building on the original HYDROS PRO with innovations in comfort, fit, and performance for a buoyancy control device. She also emphasized the growing importance of digital engagement in diving, including educating consumers on new technologies and supporting dealers with digital tools and content.
Financial results: Pretax loss narrows, margins improve
David Johnson said loss before income taxes was $1.3 million for the fiscal first quarter, compared with a pretax loss of $18.9 million in the prior-year quarter. He attributed the improvement “mostly” to revenue growth and improving margins.
Gross margin increased to 36.6%, up 6.7 percentage points from the prior year. The CFO said higher volumes drove better overhead absorption, and added that price increases and progress on cost savings initiatives helped offset higher material costs.
Operating expenses increased $2.1 million year over year, primarily due to higher sales volume-related expenses, partially offset by lower warranty expense. Johnson said the warranty benefit was “probably less than a point” of operating expense percentage improvement, but declined enough to merit mention.
Tax expense for the quarter was about $2 million, driven mainly by an adjustment tied to the company’s U.S. valuation allowance on deferred tax assets.
Inventory, balance sheet, dividend, and outlook themes
The company said it continues to make progress reducing inventory. Inventory at the end of the first quarter was $183.9 million, down about $17.7 million from the prior-year quarter.
Johnson also highlighted that the company’s balance sheet remains debt-free and that it continues to pay a dividend. He noted the board approved its most recent dividend announced in December.
During the Q&A, Sidoti analyst Anthony Lebiedzinski asked about the mix of pricing versus unit volume growth. Management said most of the quarter’s increase was driven by unit volume, though the company also implemented pricing actions across the businesses in response to cost increases.
On innovation, executives said it remains central to maintaining leadership amid strong competition. They added that new product success has improved over the last couple of years, after dipping during the COVID cycle.
Asked about e-commerce, management did not provide a revenue percentage but said it is the company’s fastest-growing channel and a key contributor to year-over-year growth. The stated goal is to keep e-commerce expanding faster than the broader businesses.
Regarding trade inventory, management said the channel was in a healthy position entering the quarter and that retailers were well positioned from an inventory standpoint to support sell-in. They said they are now watching for consumer takeaway as the season begins.
On cost savings, management said it expects continued focus on optimizing product costs and operating efficiency, describing a “whole slew of initiatives” underway, particularly important in a volatile supply-chain environment.
Finally, on taxes, the CFO said the tax rate could remain “wonky” given the geographic mix of profits and the U.S. valuation allowance dynamics, making it difficult to provide a stable rate expectation until profitability stabilizes.
About Johnson Outdoors (NASDAQ:JOUT)
Johnson Outdoors Inc is a diversified outdoor recreation company that develops, manufactures and markets a broad range of gear and equipment for marine and land-based activities. The company operates through two primary segments: the Marine Electronics & Boat Group and the Outdoor Products Group. Its marine offerings include electric motors and anchors under the Minn Kota® brand, fish-finding and sonar systems under the Humminbird® brand, and a lineup of recreational watercraft under the Old Town® and Ocean Kayak® names.
