Key Highlights

  • Revenue of USD 44.78 million missed the USD 45.04 million estimate, and Earnings were USD 0.00 per share.
  • Gross Margin was 32.4%, up 520 basis points, including a USD 2.6 million cost of sales reduction from Tariff refunds.
  • Adjusted EBITDA was USD 2.3 million, and management withdrew its full year adjusted EBITDA guidance while refining Revenue guidance.
  • Cash, cash equivalents and marketable securities were USD 41.8 million, and the company reported no Debt at quarter end.

GrowGeneration (NASDAQ:GRWG), a hydroponics and gardening retailer, reported third quarter 2026 revenue of USD 44.78 million against a USD 45.04 million estimate. Earnings Per Share were USD 0.00 against an estimate of USD 0.01. GAAP Net Income was USD 0.2 million against a net loss of USD 2.4 million, or USD 0.04 per share, a year earlier.

Management said revenue was in line with its guidance range and slightly lower than a year earlier because of a few large one-time transactions in the prior year period.

Margins and Segments

Gross profit was USD 14.5 million against USD 12.9 million, an increase of 13.0%. Gross margin was 32.4% against 27.2%. Cultivation and Gardening gross margin was 29.9% against 23.5%, and the filing states the USD 2.6 million reduction to cost of sales from IEEPA tariff refunds contributed about 740 basis points to that segment's margin. Storage Solutions Gross Profit was unchanged at USD 3.9 million.

Proprietary Brand sales grew about 19% to USD 14.5 million and exceeded 40% of cultivation and gardening net revenue. Store and other operating expenses fell about 12% to USD 6.4 million from USD 7.2 million. Nine-month adjusted EBITDA improved to about USD 1 million from a loss of USD 4 million.

Guidance, Stores and Cash

Management refined full year revenue guidance to USD 163 million to USD 165 million from USD 162 million to USD 168 million, and withdrew its previous full year adjusted EBITDA guidance given additional store closures and restructuring. It said it began closing two stores during the quarter, completed after quarter end, and anticipates closing another two to three locations before year end, for four to five fourth quarter closures.

The MMI Business generated USD 9.2 million of third quarter revenue, ahead of management's expectations. The company ended the quarter with USD 41.8 million in cash, cash equivalents and marketable securities and no debt.

Items to Follow

The filing states that legal proceedings arise in the ordinary course of business, including contract and employment disputes, and that outcomes are not anticipated to be material, though it notes no assurance can be given. Management said it anticipates completing the majority of its restructuring initiatives by the end of 2026, and that MMI has exceeded its initial expectations for 2026 and is tracking toward strong year-over-year revenue growth. The filing also notes about USD 3.5 million of total restructuring and related costs under its 2024 restructuring plan. The items to follow are store closure costs, proprietary brand mix, tariff refund effects on margin and fourth quarter revenue.