Financial Highlights (Quarter Ended November 30, 2025)
Net sales increased to $8.1 million, compared to $7.7 million in the prior year period, an increase of 5.2%
Gross profit of $5.5 million, or 68.1% of sales, compared to $5.5 million, or 71.1% in the prior year period
Operating expenses declined to $4.6 million, or 57.0% of net sales compared to $4.8 million, or 62.4% of net sales in the prior year period
Net income increased to $704,833, compared to $633,706 in the prior year period
Adjusted EBITDA was $1.2 million, representing a 13.9% increase from $1.0 million in the prior year period
Cash on hand as of November 30, 2025 was $5.0 million, compared to $4.8 million as of May 31, 2025
Basic and diluted earnings per share for 2Q26 were approximately $0.10 and $0.09, respectively, compared to $0.10 and $0.08 in prior year period
Recent Business Highlights
AXIL announced national distribution of the new X30i LT with Walmart, the world's largest mass-market retailer; initial product rollout expected across approximately 3,700 U.S. locations beginning in early calendar 2026
AXIL launched GS Extreme 3.0, the next evolution of its flagship tactical earbuds, incorporating proprietary sound-filter technology, improved water resistance, and more than double the battery life of the prior generation
Launched Reviv3® products through Chatters, Canada's largest salon retailer, with over 115 locations throughout the country
"Fiscal 2026 is shaping up to be a strong year for Axil, driven by the continued execution of our strategic plan to invest in retail channel expansion while strengthening our proven e-commerce model," said Jeff Toghraie, Chairman and Chief Executive Officer of Axil. "In the quarter, we delivered solid top-line growth alongside meaningful bottom-line progress. Net sales increased year over year, operating expenses declined notably as a percentage of revenue, and key profitability metrics improved, positioning us for continued progress for the remainder of the year."
"EBITDA increased approximately $0.2 million year over year. Importantly, when excluding a non-recurring forgiveness of accounts payable of approximately $0.2 million recorded in the prior year period, normalized Adjusted EBITDA improved by approximately $0.4 million for the quarter. This improvement reflects meaningful optimization across our operating structure and demonstrates our ability to generate operating leverage as revenue grows.
Our retail momentum continues to accelerate, driven by stronger sell-through and improved product visibility with major retail partners announced in 2025. We remain focused on diversifying our revenue streams and expanding our market presence by reaching new end-users and categories. A key milestone is our recently announced national distribution agreement with Walmart, which will introduce AXIL products to thousands of retail locations nationwide starting in early 2026.
The initial rollout will showcase our next-generation in-ear hearing protection technology, featuring advanced sound control, dual-mode noise protection, and all-day comfort across a broad range of applications. While this partnership is still in its early stages and not yet generating revenue, we see it as powerful validation of both our product innovation and growing brand strength.
As we progress through the second half of fiscal 2026, we remain focused on expanding our revenue streams and strengthening and expanding key retail partnerships. We believe we can sustain profitable growth through cash generated from operations while continuing to build lasting, durable value for our shareholders. We believe all current strategic initiatives can be funded through our existing cash flow at this time," concluded Mr. Toghraie.
Use of Non-GAAP Financial Measures
The Company calculates EBITDA by taking net income calculated in accordance with accounting principles generally accepted in the United States ("GAAP"), and adjusting for income taxes, interest income or expense, and depreciation and amortization. The Company calculates adjusted EBITDA as EBITDA, further adjusted for stock-based compensation. Adjusted EBITDA is also presented as a percentage of revenue, which is calculated by dividing the non-GAAP Adjusted EBITDA for a period by revenue for the same period. Other companies may calculate EBITDA and adjusted EBITDA differently, limiting the usefulness of these measures for comparative purposes. The Company believes that these non-GAAP measures of financial results provide useful information regarding certain financial and business trends relating to the Company's financial condition and results of operations, and management considers EBITDA and adjusted EBITDA important indicators in evaluating the Company's business on a consistent basis across various periods for trend analyses. These non-GAAP financial measures exclude significant expenses and income that are required by GAAP to be recorded in the Company's financial statements and are subject to inherent limitations as they reflect the exercise of judgments by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. Investors should not rely on any single financial measure to evaluate our business. A reconciliation of EBITDA and Adjusted EBITDA to the most comparable financial measure, net income, calculated in accordance with GAAP is included in a schedule to this press release.
AXIL BRANDS, INC. AND SUBSIDIARIESCONSOLIDATED EBITDA and ADJUSTED EBITDAFOR THE THREE AND SIX MONTHS ENDED NOVEMBER 30, 2025 AND 2024(Unaudited)
For the Three Months EndedNovember 30,
For the Six Months EndedNovember 30,
2025
2024
2025
2024
Net income (GAAP)
$
704,883
$
633,706
$
1,039,177
$
523,901
Provision for income taxes
233,115
67,250
348,173
67,250
Interest income, net
(31,181
)
(26,044
)
(67,477
)
(54,675
)
Depreciation and amortization
67,514
34,440
129,601
47,335
Total EBITDA (Non-GAAP)
974,331
709,352
1,449,474
583,811
Adjustments:
Stock-based compensation
181,022
304,600
380,234
602,464
Total Adjusted EBITDA (Non-GAAP)
$
1,155,353
$
1,013,952
$
1,829,708
$
1,186,275
Sales, net (GAAP)
$
8,134,859
$
7,732,574
$
14,991,077
$
13,583,846
Adjusted EBITDA as a percentage of Sales, net (Non-GAAP)
14.2
%
13.1
%
12.2
%
8.7
%
AXIL BRANDS, INC. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS
November 30, 2025
May 31, 2025
(Unaudited)
ASSETS
CURRENT ASSETS:
Cash
$
4,975,968
$
4,769,854
Accounts receivable, net
2,439,850
1,003,945
Inventory, net
4,719,150
2,533,658
Due from related party
-
222
Prepaid expenses and other current assets
471,003
947,969
Total Current Assets
12,605,971
9,255,648
OTHER ASSETS:
Property and equipment, net
398,582
412,261
Intangible assets, net
423,012
403,591
Right of use assets
466,820
579,121
Deferred tax asset
172,334
46,239
Other assets
20,720
20,720
Goodwill
2,152,215
2,152,215
Total Other Assets
3,633,683
3,614,147
TOTAL ASSETS
$
16,239,654
