Sturm, Ruger & Company (RGR) Q1 2025 earnings summary

Executive summary

• Q1 2025 net sales were $135.7 million, nearly flat year-over-year, with net income rising 9.7% to $7.8 million and diluted EPS increasing to $0.46 from $0.40.

• New CEO Todd Seyfert emphasized innovation, operational discipline, and leveraging company culture, while acknowledging the leadership transition and contributions of outgoing CEO Chris Killoy.

• New products accounted for $40.7 million, or 31.6% of net firearms sales, with strong demand for RXM pistol, Ruger American Generation II Rifles, 10/22 rifles, LCP MAX pistol, and Marlin lever-action rifles.

• Despite a 9.6% industry-wide decline in retail firearm unit sales and 11.5% revenue drop, the company maintained sales and profitability.

• Firearms accounted for 99% of sales; castings contributed less than 1%.

Financial highlights

• Gross profit for Q1 2025 was $29.9 million, with a gross margin of 22.0%, up from 21.5% in the prior year.

• EBITDA increased 5.6% to $14.3 million, with an EBITDA margin of 10.5%.

• Cash and short-term investments totaled $108.3 million at quarter-end; cash provided by operations was $11.1 million.

• Operating income was $8.5 million, up from $7.5 million in Q1 2024.

• Working capital was $198.6 million with a current ratio of 4.6; no debt on the balance sheet.

Outlook and guidance

• Capital expenditures for 2025 are expected to exceed $30 million, up from historical levels, to support new product launches, facility upgrades, and capacity expansion.

• Plans to accelerate new product introductions and invest in manufacturing capabilities.

• Dividend policy remains at approximately 40% of net income; $0.18 per share dividend declared for Q2 2025.

• Management expects continued volatility in demand and is monitoring supply chain and regulatory risks.

• U.S.-based manufacturing provides insulation from global trade disruptions and tariffs.