--- title: "Compass Diversified | 8-K: FY2026 Q1 Revenue Misses Estimate at USD 426.86 M" type: "News" locale: "en" url: "https://longbridge.com/en/news/285432836.md" datetime: "2026-05-06T20:28:07.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/285432836.md) - [en](https://longbridge.com/en/news/285432836.md) - [zh-HK](https://longbridge.com/zh-HK/news/285432836.md) --- # Compass Diversified | 8-K: FY2026 Q1 Revenue Misses Estimate at USD 426.86 M Revenue: As of FY2026 Q1, the actual value is USD 426.86 M, missing the estimate of USD 437.75 M. EPS: As of FY2026 Q1, the actual value is USD -0.62. EBIT: As of FY2026 Q1, the actual value is USD 25.57 M. ### Financial Summary (GAAP) - **Net Revenues**: For Q1 2026, net revenues were $426.9 million, representing a 5.9% decrease compared to Q1 2025. - **Net Loss from Continuing Operations**: The net loss from continuing operations for Q1 2026 was - $30.8 million, an improvement from - $49.8 million in Q1 2025. ### Financial Summary (Non-GAAP – Excluding Lugano in the prior year period) - **Net Revenues**: Net revenues for Q1 2026 were $426.9 million, remaining flat compared to Q1 2025. - **Branded Consumer**: Net revenues for Branded Consumer were $257.0 million, an increase of 2.3% from Q1 2025. - **Industrial**: Net revenues for Industrial were $169.9 million, a decrease of 3.3% from Q1 2025. - **Subsidiary Adjusted EBITDA**: Subsidiary Adjusted EBITDA for Q1 2026 was $83.9 million, up 6.3% from Q1 2025. - **Branded Consumer**: Branded Consumer Subsidiary Adjusted EBITDA was $59.4 million, an increase of 11.6% from Q1 2025. - **Industrial**: Industrial Subsidiary Adjusted EBITDA was $24.4 million, a decrease of 4.5% from Q1 2025. ### Operational Metrics (Three Months Ended March 31) - **Net Sales**: Net sales were $426,855 thousand in 2026, down from $453,775 thousand in 2025. - **Cost of Sales**: Cost of sales decreased to $237,497 thousand in 2026 from $257,743 thousand in 2025. - **Gross Profit**: Gross profit was $189,358 thousand in 2026, compared to $196,032 thousand in 2025. - **Operating Expenses**: - Selling, general and administrative expense: $132,010 thousand in 2026 vs $150,377 thousand in 2025. - Management fees: $15,934 thousand in 2026 vs $18,863 thousand in 2025. - Amortization expense: $22,844 thousand in 2026 vs $23,351 thousand in 2025. - Impairment expense: $20,500 thousand in 2026 vs $0 thousand in 2025. - **Operating Income (Loss)**: Operating loss was - $1,930 thousand in 2026, a decrease from an operating income of $3,441 thousand in 2025. - **Other Income (Expense)**: - Interest expense, net: - $27,495 thousand in 2026 vs - $35,851 thousand in 2025. - Amortization of debt issuance costs: - $2,047 thousand in 2026 vs - $1,125 thousand in 2025. - Other income (expense), net: $7,705 thousand in 2026 vs - $13,681 thousand in 2025. - **Net Loss from Continuing Operations before Income Taxes**: - $23,767 thousand in 2026 vs - $47,216 thousand in 2025. - **Provision for Income Taxes**: $7,064 thousand in 2026 vs $2,538 thousand in 2025. - **Loss from Continuing Operations**: - $30,831 thousand in 2026 vs - $49,754 thousand in 2025. - **Gain on Sale of Discontinued Operations**: $157 thousand in 2026 vs $44 thousand in 2025. - **Net Loss**: - $30,674 thousand in 2026 vs - $49,710 thousand in 2025. - **Net Loss Attributable to Holdings**: - $30,759 thousand in 2026 vs - $29,993 thousand in 2025. - **Basic Loss Per Common Share Attributable to Holdings (Continuing Operations)**: - $0.62 in 2026 vs - $0.59 in 2025. ### Liquidity and Capital Resources - As of March 31, 2026, Compass Diversified had $65.2 million in cash and cash equivalents and approximately $100 million in revolver availability. ### Cash Flow (Three Months Ended March 31) - **Net cash provided by (used in) operating activities**: $23,914 thousand in 2026 vs - $29,348 thousand in 2025. - **Net cash provided by (used in) investing activities**: $6,226 thousand in 2026 vs - $12,922 thousand in 2025. - **Net cash provided by (used in) financing activities**: - $32,809 thousand in 2026 vs $128,240 thousand in 2025. - **Net increase (decrease) in cash and cash equivalents**: - $2,832 thousand in 2026 vs $86,576 thousand in 2025. - **Cash and cash equivalents - end of the period**: $65,183 thousand in 2026 vs $146,235 thousand in 2025. - **Purchases of property and equipment**: - $5,107 thousand in 2026 vs - $13,100 thousand in 2025. - **Distributions paid - common shares**: $0 thousand in 2026 vs - $18,809 thousand in 2025. - **Distributions paid - preferred shares**: - $9,714 thousand in 2026 vs - $8,434 thousand in 2025. ### Business Updates - Compass Diversified completed the sale of Sterno’s food service business for an enterprise value of $292.5 million, using the net proceeds to repay outstanding debt. - The Sterno transaction generated approximately $280 million in proceeds, reducing senior secured indebtedness below 1.0x, which is sufficient to avoid second quarter milestone fees associated with excess leverage by June 30, 2026. ### 2026 Outlook Compass Diversified updated its fiscal 2026 financial guidance to reflect the Sterno sale, with the updated guidance at or above initial expectations, adjusted for the divested business. The company projects total Subsidiary Adjusted EBITDA for 2026 to be between $320.0 million and $365.0 million. This includes a forecast of $225.0 million to $260.0 million for Branded Consumer and $95.0 million to $105.0 million for Industrial segments. ### Related Stocks - [CODI.US](https://longbridge.com/en/quote/CODI.US.md) ## Related News & Research - [Rep. Brian Babin Sells Off Shares of Compass Diversified Holdings (NYSE:CODI)](https://longbridge.com/en/news/287013170.md) - [Traders Purchase High Volume of Compass Diversified Call Options (NYSE:CODI)](https://longbridge.com/en/news/285597657.md) - [Compass Diversified Balances Growth, Debt After Sterno Sale](https://longbridge.com/en/news/285658688.md) - [Compass Diversified Hldgs Earnings Report: Q4 Overview](https://longbridge.com/en/news/277098624.md) - [Compass Diversified Sells Sterno Food Service Business To Reduce Debt](https://longbridge.com/en/news/281035349.md)