Financial Performance - Net sales for fiscal 2025 were $474.7 million, a decrease of $61.2 million, or 11.4%, compared to fiscal 2024[223] - Gross profit decreased by $30.9 million, or 19.6%, with a gross margin of 26.8%, down 270 basis points from the prior year[223] - Net income for fiscal 2025 was $13.4 million, or $0.30 per diluted share, compared to $41.4 million, or $0.89 per diluted share, in fiscal 2024[223] - Operating income decreased by $23.2 million, or 49.3%, to $23.9 million, representing 5.0% of net sales[234] - Net income for fiscal 2025 was $13.4 million, down $27.9 million or 67.5% compared to fiscal 2024, resulting in a diluted net income per share of $0.30[239] - Income tax expense for fiscal 2025 was $5.8 million, a decrease of $4.5 million or 43.8% from fiscal 2024, with an effective tax rate of 30.2%[238] Cash Flow and Investments - Cash used in operating activities was $7.2 million in fiscal 2025, a decline of $113.9 million from cash provided in fiscal 2024[240] - Cash used in investing activities decreased by $62.3 million in fiscal 2025, with capital expenditures of $21.6 million, $69.2 million lower than fiscal 2024[243] - Cash used in financing activities was $9.2 million in fiscal 2025, primarily due to $25.5 million in share repurchases and $23.1 million in dividend distributions[245] - The company expects to spend between $25.0 million and $30.0 million on capital expenditures in fiscal 2026[244] - The company had $25.2 million in cash and cash equivalents on hand as of April 30, 2025[250] Expenses and Costs - Research and development expenses increased by $2.3 million, or 31.8%, primarily due to higher materials and testing costs associated with new product development[232] - Interest expense increased by $2.6 million, or 124.9%, primarily due to higher average debt balances[236] - Inflationary pressures have increased costs for components, parts, raw materials, and labor, expected to continue impacting the company in fiscal 2026[253] Inventory and Sales - Inventory balances increased by $29.3 million between April 30, 2024, and April 30, 2025, due to a slowdown in demand[231] - New products accounted for 42.8% of net sales for the 12 months ended April 30, 2025, including six new pistols and six new long guns[229] Market Overview - The U.S. firearm manufacturing industry grew at a 1.5% compound annual growth rate in units from 2018 through 2023[225] - The annual domestic non-military firearm market is estimated at approximately $2.8 billion for handguns and $1.9 billion for long guns[225] Debt and Compliance - As of April 30, 2025, the company had $80.0 million of borrowings outstanding on its revolving line of credit, with an average interest rate of 6.69%[247] - The company is in compliance with all debt covenants as of April 30, 2025[247]

Group 1 - Smith & Wesson (NASDAQ: SWBI) gained significant attention during the last U.S. presidential election due to differing political views on gun control [1] - The focus is on identifying companies with a market capitalization of less than $10 billion that have a proven ability to reinvest capital for impressive returns [1] - The ideal companies should demonstrate a long-term capability of capital compounding with a high enough compound annual growth rate to potentially deliver tenfold returns or greater [1] Group 2 - A conservative investment strategy is primarily adopted, with occasional pursuits of opportunities that present a favorable risk-reward ratio [1] - The approach emphasizes maintaining a long-term perspective on investments to generate higher returns compared to market indices [1]

Financial Data and Key Metrics Changes - Net sales for Q4 2025 were $140.8 million, down $18.4 million or 11.6% compared to the prior year [13] - Gross margin decreased to 28.8%, down 6.7 percentage points from the prior year [14] - Net income for Q4 was $8.6 million, a decrease of $18.7 million from the prior year [15] - GAAP earnings per share (EPS) was $0.19, down from $0.59 in the prior year [15] - Non-GAAP EPS was $0.20, down from $0.48 in Q4 fiscal 2024 [15] - Cash generated from operations was $40.8 million, with net free cash of $33.5 million after capital expenditures [16] Business Line Data and Key Metrics Changes - New products accounted for 44% of total sales in Q4 [6] - Average selling prices (ASPs) decreased by 4.5% year-over-year, with long guns ASPs increasing by 11% and handguns ASPs declining by 6.3% [7][8] - Shipments into the sporting goods channel for long guns declined by 31.7% [7] Market Data and Key Metrics Changes - Overall adjusted market share was down 5.4% in Q4, with an 8.4% decline in shipments [6] - NICS data for long guns was down 7.1% in Q4 [7] - Consumer demand for firearms is cautious due to macroeconomic factors affecting discretionary spending [8] Company Strategy and Development Direction - The company plans to focus on innovation and new product development as a competitive differentiator [6] - Management is extending the summer shutdown by an extra week to align inventory levels with demand [10] - The company aims to prioritize debt reduction and maintain dividend payments [11] Management's Comments on Operating Environment and Future Outlook - Management expects demand for firearms in fiscal 2026 to be similar to fiscal 2025, with potential headwinds from inflation and tariffs [17] - The first quarter of fiscal 2026 is anticipated to be approximately 10% lower than the previous year [17] - Management believes that the exit of smaller competitors from the market may provide opportunities for market share growth [20] Other Important Information - The company reported a $29.3 million increase in inventory due to market softening in the first half of the fiscal year [16] - The effective tax rate is expected to be approximately 30% for the upcoming fiscal year [18] Q&A Session Summary Question: Impact of smaller competitors exiting the market - Management views the exit of smaller players as a potential tailwind for market share growth, with no significant influx of liquidation inventory expected [20][21] Question: Pricing and ASPs in the competitive market - Management believes there is no need for across-the-board pricing cuts, as the brand remains strong and new products are performing well [22] Question: Consumer behavior in response to economic pressures - Demand is still strong at the high-end and entry-level markets, while mid-tier products are seeing a decline [24] Question: Inventory management and shutdown extension - The extra week of shutdown is to better align inventory with demand, particularly in Q2 [25][26] Question: Exposure to tariffs and their impact - Management is monitoring tariff impacts closely, particularly for steel, and is looking for cost control initiatives [30][35] Question: Inventory reduction expectations - Significant inventory reduction is expected throughout the fiscal year, with Q1 typically being the softest quarter [36] Question: Balance sheet and debt repayment - Healthy cash generation is anticipated, with a significant reduction in debt expected as cash is used for repayment [40][41]

Financial Data and Key Metrics Changes - Net sales for the fourth quarter were $140.8 million, which is $18.4 million or 11.6% lower than the prior year comparable quarter [13] - Gross margin decreased to 28.8%, down 6.7 percentage points from the prior year, attributed to lower production volume and increased promotions [14] - Net income for the fourth quarter was $8.6 million, a decrease of $18.7 million compared to the prior year, primarily due to lower net sales and gross margin [15] - GAAP earnings per share (EPS) was $0.19, down from $0.59 in the prior year, while non-GAAP EPS was $0.20, down from $0.48 [15] Business Line Data and Key Metrics Changes - New products accounted for 44% of sales in the fourth quarter, indicating a strong performance in innovation [6] - Average selling prices (ASPs) decreased by 4.5% year-over-year, with long guns ASPs increasing by 11% and handguns ASPs declining by 6.3% [7][8] - In the handgun category, market share was gained despite a 3.4% decline in adjusted mix, while long guns saw a 31.7% decline in shipments [7] Market Data and Key Metrics Changes - Overall adjusted mix was down 5.4%, with an 8.4% decline in shipments into the channel [6] - The firearms market is experiencing cautious consumer behavior due to macroeconomic pressures, with demand for firearms appearing normal for the summer [8][9] - Inventory levels in the channel are being managed conservatively, with a slight increase of about 5,000 units during the quarter [9] Company Strategy and Development Direction - The company plans to focus on innovation and new product introductions to maintain market share leadership [10][11] - An extra week of summer shutdown is planned to better align inventory levels with demand [10] - The company aims to prioritize debt reduction and maintain a strong balance sheet while investing in innovation [11] Management's Comments on Operating Environment and Future Outlook - Management noted that macroeconomic factors such as inflation and high interest rates are impacting demand, with expectations for a 10% decrease in first-quarter demand compared to the previous year [17] - Margins are expected to remain under pressure due to low volume and cost increases, particularly from tariffs on raw materials [17] - The company remains optimistic about its market position and plans to leverage its brand strength to maintain ASPs [8][11] Other Important Information - The company generated $40.8 million in cash from operations during the quarter and ended with $25.2 million in cash [16] - The Board authorized a quarterly dividend of $0.13 to be paid to stockholders [16] Q&A Session Summary Question: Impact of smaller competitors exiting the market - Management views the exit of smaller players as a potential tailwind for market share acquisition, with no significant influx of liquidation inventory expected [19][20] Question: Pricing and ASPs in the competitive market - Management believes there is no need for pricing cuts due to strong brand performance and successful new product introductions [22][23] Question: Consumer behavior in response to economic pressures - Demand is still strong in high-end and entry-level markets, while mid to lower-tier segments are trending towards lower-priced products [24][25] Question: Inventory reduction strategy - A significant inventory reduction is expected throughout the year, with Q1 typically being the softest quarter [37] Question: Balance sheet and debt repayment outlook - Healthy cash generation is anticipated, with a significant reduction in debt expected as inventory levels decrease [41][42]

• Q4 Net Sales of $140.8 Million • Q4 Gross Margin of 28.8%; Non-GAAP Gross Margin of 29.2% • Q4 EPS of $0.19/Share Exhibit 99.1 Smith & Wesson Brands, Inc. Reports Fourth Quarter and Full Fiscal 2025 Financial Results MARYVILLE, Tenn., June 18, 2025 – Smith & Wesson Brands, Inc. (NASDAQ Global Select: SWBI), a U.S.-based leader in firearm manufacturing and design, today announced financial results for the fourth quarter and full fiscal year 2025, ended April 30, 2025. Fourth Quarter Fiscal 2025 Financial H ...

Financial Performance - Q4 net sales were $140.8 million, a decrease of $18.4 million, or 11.6%, from the comparable quarter last year [5] - Q4 gross margin was 28.8%, compared to 35.5% in the comparable quarter last year [5] - Q4 GAAP net income was $8.6 million, or $0.19 per diluted share, compared to $27.3 million, or $0.59 per diluted share, for the comparable quarter last year [5] - Non-GAAP net income for Q4 was $9.0 million, or $0.20 per diluted share, compared to $22.1 million, or $0.48 per diluted share, for the comparable quarter last year [5] - Full year net sales were $474.7 million, a decrease of $61.2 million, or 11.4%, from the prior fiscal year [5] - Full year gross margin was 26.8%, compared to 29.5% in the prior fiscal year [5] - Full year GAAP net income was $13.4 million, or $0.30 per diluted share, compared to $41.4 million, or $0.89 per diluted share, for the prior fiscal year [5] Management Commentary - The President and CEO noted that the fourth quarter was more difficult than anticipated due to macro-economic and industry trends, with lower sales and production volumes pressuring margins [4] - The Executive Vice President and CFO indicated that persistent inflation, high interest rates, and tariff concerns negatively impacted firearm market conditions [4] Market Outlook - The company expects demand for firearms in fiscal 2026 to be similar to fiscal 2025, subject to economic headwinds such as inflation and tariff-related cost increases [4] - The overall firearms market is seeing consumers being cautious due to macro-economic factors affecting discretionary spending [4] Dividend Announcement - The board of directors has authorized a quarterly dividend of $0.13 per share, payable to stockholders of record on July 7, 2025 [6]

Company Announcement - Smith & Wesson Brands, Inc. has rescheduled its conference call to discuss the fourth quarter and full fiscal 2025 financial and operational results from June 19, 2025, to June 18, 2025 [1] - The conference call and webcast will begin at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) [1] Participation Details - Interested parties in North America can participate by dialing 1-877-704-4453, while those outside North America can dial 1-201-389-0920 [2] - Participants are advised to dial in at least 10 minutes prior to the start of the call [2] - A live and archived webcast will be available on the company's website under the Investor Relations section [2] Company Overview - Smith & Wesson Brands, Inc. is a leader in firearm manufacturing and design, offering a wide range of handgun, long gun, and suppressor products under the Smith & Wesson® and Gemtech® brands [3] - The company also provides forging and machining services to third parties [3]

Core Viewpoint - Smith & Wesson Brands, Inc. is set to release its fourth quarter and full fiscal 2025 financial results on June 19, 2025, after market close [1] Group 1: Financial Results Announcement - The financial results will be discussed in a conference call and webcast on the same day, featuring key executives including the President and CEO, Mark Smith, and CFO, Deana McPherson [2] - The conference call is scheduled to begin at 5:00 p.m. Eastern Time [2] Group 2: Participation Details - Interested parties in North America can join the call by dialing 1-877-704-4453, while international participants can call 1-201-389-0920 [3] - Participants are advised to dial in at least 10 minutes prior to the start of the call [3] Group 3: Company Overview - Smith & Wesson Brands, Inc. is a leader in firearm manufacturing and design, offering a wide range of handgun, long gun, and suppressor products under the Smith & Wesson® and Gemtech® brands [4] - The company also provides forging and machining services to third parties [4]

Financial Data and Key Metrics Changes - Net sales for Q3 2025 were $115.9 million, down $21.6 million or 15.7% from the prior year [21] - Gross margin decreased to 24.1%, a decline of 4.6% compared to the same quarter last year due to unfavorable fixed cost absorption and higher promotional costs [23] - Net income for the quarter was $1.7 million, or $0.04 per share, with non-GAAP income per share at $0.02 [24] Business Line Data and Key Metrics Changes - New products accounted for over 41% of sales in the quarter, indicating strong performance [10] - Handgun average selling prices (ASPs) declined by 7.8%, while long gun ASPs increased by 17.2% due to strong demand for higher-priced lever rifles [13][14] - Shipments into the channel declined by 7.7%, with a noted gain in market share for handguns despite an overall NICS decline of 4.1% [11] Market Data and Key Metrics Changes - Adjusted NICS was down 4.5%, reflecting two months of year-over-year declines followed by a small increase in January [11] - Long gun unit sales grew at a compounded annual rate of nearly 20% over a two-year basis, outperforming NICS [12] - Channel inventory at distributors is currently under nine weeks, indicating a clean inventory situation [17] Company Strategy and Development Direction - The company aims to continue its focus on innovation, with several new products expected to be introduced in the upcoming quarters [10] - The flexible manufacturing model is designed to ensure profitability regardless of demand conditions, allowing the company to adjust production levels based on sales forecasts [16] - The company plans to maintain a disciplined capital allocation strategy, including debt repayment and dividends [17][29] Management's Comments on Operating Environment and Future Outlook - Management anticipates that the firearms market will remain steady at current demand levels, with no major demand catalysts expected in the near term [18] - The company expects full-year revenue to decline by 5-10% from fiscal 2024, leaning towards the lower end of this range due to softer demand trends [26] - Management expressed optimism about the potential for increased consumer discretionary spending in the long term, which could positively impact demand [41] Other Important Information - The company repurchased approximately 220,000 shares during the quarter, reducing the share count by more than 1.5 million shares net of dilution [17] - The board has authorized a quarterly dividend of $0.13 per share, with payment scheduled for April 3 [26] Q&A Session Summary Question: What is impacting sales of legacy products? - Management indicated that the Bodyguard 2.0 is cannibalizing some of their own product lines, alongside competitive pressures and consumer discretionary spending challenges [33][35] Question: How is the industry behaving regarding distributor inventory? - Management noted that distributor inventory is at about 8.5 weeks, indicating a healthy inventory management situation across the industry [38] Question: What is the company's exposure to tariffs and the regulatory environment? - Management stated that while there is some exposure to tariffs, it is not expected to materially impact financials. They also expressed satisfaction with the current regulatory stability [44][46] Question: What are the expectations for ASPs in Q4? - Management expects ASPs for handguns to remain flat, while long gun ASPs should maintain their current mix [52] Question: What are the company's goals for 2026? - Management aims to focus on new product introductions and market share growth, with a continued emphasis on innovation [56][58]

Financial Data and Key Metrics Changes - Net sales for Q3 2025 were $115.9 million, down $21.6 million or 15.7% from the prior year [21] - Gross margin decreased to 24.1%, which is 4.6% lower than the comparable quarter last year due to unfavorable fixed cost absorption and higher promotional costs [23] - Net income for the quarter was $1.7 million, or $0.04 per share, with non-GAAP income per share at $0.02 [24] Business Line Data and Key Metrics Changes - New products accounted for over 41% of sales in the quarter, indicating strong performance [10] - Handgun average selling prices (ASPs) declined by 7.8%, while long gun ASPs increased by 17.2% due to strong demand for higher-priced lever rifles [13][14] - Shipments into the channel declined by 7.7%, with a noted gain in market share for handguns despite an overall NICS decline of 4.1% [11] Market Data and Key Metrics Changes - Adjusted NICS was down 4.5%, reflecting a decline in consumer demand [11] - Long gun unit sales grew at a compounded annual rate of nearly 20% over two years, outperforming NICS [12] - Channel inventory at distributors is currently under nine weeks, indicating a clean inventory situation [17] Company Strategy and Development Direction - The company is focused on innovation, with several new products expected to be introduced in the upcoming quarters [10] - A flexible manufacturing model is in place to ensure profitability regardless of demand conditions [9] - The company plans to continue investing in innovation and manufacturing while managing capital allocation to return value to stockholders [19][29] Management's Comments on Operating Environment and Future Outlook - Management anticipates a steady firearms market with no major demand catalysts expected in the near term [41] - The company expects full-year revenue to decline by 5-10%, now leaning towards a 10% decline due to softer demand trends [26] - The effective tax rate is expected to be approximately 28% [28] Other Important Information - The company repurchased approximately 220,000 shares during the quarter, totaling $2.8 million [25] - A quarterly dividend of $0.13 per share has been authorized, with payment scheduled for April 3 [26] Q&A Session Summary Question: What is affecting sales of legacy products? - Management indicated that the Bodyguard 2.0 is cannibalizing some of their own product lines, alongside competitive pressures and consumer discretionary spending being impacted by inflation [33][35] Question: How is the industry behaving regarding distributor inventory? - Management noted that distributor inventory is at about 8.5 weeks, indicating a healthy inventory management across the channel [38] Question: What is the company's exposure to tariffs and the regulatory environment? - Management stated that while there is some exposure to tariffs, it is not expected to materially impact financials. They also expressed satisfaction with the current regulatory stability [44][46] Question: What are the expectations for ASPs in Q4? - Management expects handgun ASPs to remain flat, while long gun ASPs should maintain their current mix [52] Question: What are the company's goals for 2026? - Management aims to continue focusing on new product introductions and expanding market share, while maintaining profitability through flexible manufacturing [58][60]