Solo Brands (DTC) investor relations material

Business transformation and leadership changes

• New CEO appointed after previous leadership resigned; focus shifted to operational turnaround and brand strength.

• Company faced challenges from overbuilt cost structure, declining sales, and excess retailer inventory.

• Debt was refinanced through June 2028, and the going concern disclaimer was removed, restoring NYSE listing.

• Cost structure was aggressively reduced, with SG&A down 36% year-over-year and further cuts ongoing.

• AI and efficiency initiatives are being implemented to drive further operational improvements.

Brand portfolio and market positioning

• Two main brands, Solo Stove and Chubbies, account for 90% of revenue; water sports brands ISLE and Oru Kayak make up the rest.

• Solo Stove boasts an NPS of 73, indicating strong customer loyalty; Chubbies also maintains high brand engagement.

• Chubbies saw record sales and EBITDA growth in the first half, while Solo Stove faced significant retail headwinds.

• DTC and retail channels are now more closely aligned, with coordinated promotional calendars and MAP strategy.

• International sales are about 10% but targeted to grow to 25–30% with new distribution in India, Europe, and the UK.

Financial performance and cost management

• LTM revenue is around $366 million with EBITDA of $15 million; Q3 saw a sharp revenue drop from $94M to $53M.

• Cost reductions included renegotiating audit and insurance contracts, saving over $2 million.

• Marketing spend was cut and refocused, eliminating unproductive sponsorships and shifting to performance-based analytics.

• Margins on new products average around 60%, with DTC margins higher than retail; griddle margins are tighter due to tariffs.

• Company is not relying on revenue upside for 2026 financial targets, focusing on continued cost discipline.