Key Highlights

  • Net sales were USD 151 million, up 27.0% year over year.
  • Modern Oral net sales rose 103% and accounted for 49% of total revenue.
  • Adjusted EBITDA was USD 18 million, down 41% year over year.
  • Cash stood at USD 251 million after USD 10.0 million of share repurchases.

Turning Point Brands, Inc. (NYSE:TPB) reported third quarter 2026 net sales of USD 151 million, up 27.0% year over year. Reported EPS was USD 0.19, compared with estimates of EPS of USD 0.20 and Revenue of USD 146.68 million. Gross Profit was USD 85 million, up 21%, which the company tied to Modern Oral. Gross Margin was 56%, down slightly from the second quarter when normalizing for the positive impact of a Tariff refund.

Reported SG&A was USD 75 million, down almost USD 2 million sequentially, as the company scaled back areas where it saw inadequate returns. Adjusted EBITDA was USD 18 million, down 41% year over year and up USD 3 million, or 21%, sequentially on higher gross profit and reduced SG&A.

Modern Oral Growth

Modern Oral gross sales rose 114% year over year and 8% sequentially, while net sales rose 103% year over year and 9% sequentially. Modern Oral accounted for 49% of total revenue, up from 31% in the third quarter of 2025. Chief executive David Glazek described a strategy built on three priorities: gaining consumer traction, expanding distribution and building the infrastructure needed to scale. The company projects increasing its chain store count by more than 70% during 2026, with Manufacturing scheduled to commence in 2027.

Management said the strength of its two-brand portfolio is a competitive advantage. The ALP Brand introduced three of its most requested flavors in the New Frontier Collection, supported by a broader Marketing campaign.

Segment Results

Stoker's segment net sales increased 52.0% to USD 114 million and represent 75% of consolidated net sales. Modern Oral nicotine pouch net sales increased 103% to USD 74 million, and Modern Oral gross revenue was USD 94 million. Heritage Stoker's brands net revenue increased 3% to USD 39.0 million, driven by share growth in MST, partly offset by anticipated declines in loose leaf. Stoker's gross profit increased 42% to USD 64 million, and gross margin decreased 416 basis points to 56.0%.

Zig-Zag segment net sales decreased 15% to USD 37 million. Gross profit decreased 16% to USD 21 million, and gross margin was 57%, essentially unchanged from last year.

Cash Flow, Capital Allocation and Guidance

Third quarter free Cash Flow was USD 3.5 million, and the company ended the quarter with USD 251 million of cash. It repurchased USD 10.0 million of stock and said it continues to take a measured approach to capital allocation.

The company maintained the full year outlook provided on September 21, 2026. Modern Oral gross sales guidance is USD 330 million to USD 350 million, and net sales guidance is USD 260 million to USD 270 million. Full year adjusted EBITDA guidance is USD 70 million to USD 80 million, and the effective income tax rate is projected between 23% and 26%.

Fourth quarter Capital Expenditure is guided to USD 1 million to USD 2 million, excluding Modern Oral projects. In support of its PMTA, the company projects spending roughly USD 3.5 million in the fourth quarter.

Modern Oral and Guidance Ranges

Turning Point Brands reported Modern Oral net sales up 103%, at 49% of revenue. Management cited Modern Oral gross and net sales ranges, adjusted EBITDA guidance of USD 70 million to USD 80 million, a planned increase in chain store count and PMTA spending, and described 2026 as the year of building the platform.