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Roots (ROOT) investor relations material
Roots Q3 2026 earnings summary
Complete event summary combining all related documents: earnings call transcript, report, and slide presentation.Executive summary
Q3 2025 revenue reached $71.5 million, up 6.8% year-over-year, with direct-to-consumer (DTC) sales rising 4.8% and comparable sales up 6.3% due to strong omnichannel and in-store performance.
Adjusted EBITDA was $7.5 million, up 5.3% year-over-year; excluding DSU/share-based compensation revaluation, adjusted EBITDA was $7.6 million, a 7.3% increase.
Net income was $2.3 million, down 4.5% year-over-year, or $0.06 per share; adjusted net income was $3.3 million, up 17.2%, with adjusted EPS of $0.08.
Brand strength, product innovation, and omnichannel strategy drove customer acquisition and engagement, despite a dynamic retail environment and an unusually warm fall.
Maintained a strong balance sheet with declining net debt and healthy inventory ahead of the holiday season.
Financial highlights
Total sales increased 6.8% year-over-year to $71.5 million; DTC sales reached $56.8 million, up 4.8%.
DTC gross margin improved 140 basis points to 65.4%, reflecting reduced markdowns and better product mix.
Total gross profit was $43.4 million, up 8.1% year-over-year; total gross margin was 60.8%, up 80 basis points.
SG&A expenses rose 10.6% to $38.2 million, driven by higher marketing, personnel, variable selling costs, and DSU revaluation.
Free cash outflow improved to $4.6 million from $6 million last year.
Outlook and guidance
Early Q4 Black Friday and holiday trends show positive consumer engagement and strong response to curated offers and partnerships.
Marketing investments in Q4 are expected to increase by $2–3 million, focusing on both brand equity and immediate sales.
Marketing strategy for next year will be refined based on learnings from this year's mix of top-of-funnel and conversion-driving activities.
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