BRC Inc. Q4 FY2025 earnings call

2025 was a year of measurable operating progress for Black Rifle, led by strong performance in packaged coffee. The land and expand strategy proved to be a scalable and repeatable growth engine, with distribution reach increasing nearly eight points in 2025, bringing ACV to 54.9%. Direct - to - consumer business stabilized and returned to growth in the fourth quarter. The company took meaningful steps to streamline its platform. It also made progress in ready - to - drink and energy platforms. Additionally, it exceeded the goal of eliminating $25 million in medical debt for veterans through Operation Debt of Gratitude, wiping out more than $34 million in medical debt and helping approximately 15,000 veterans, and continued supporting various veteran and first responder organizations.

For 2025, packaged coffee grew 31.1% for the year, with units up more than 22% and share up 60 basis points in bagged coffee. In the fourth quarter, packaged coffee business grew 34% compared to nearly 13% growth for the broader category. Bagged coffee market share reached 3.3% nationally, up 60 basis points year over year, while pods increased to 2.2% nationally, up 40 basis points. Direct - to - consumer business stabilized in 2025 and returned to growth in the fourth quarter. Ready - to - drink coffee expanded distribution, increasing ACV by 10 points to 55.9% in 2025 but faced softness in the fourth quarter due to C - Store trends. Energy distribution expanded in line with launch year plan in 2025, reaching approximately 22% ACV across nearly 20,000 retail doors.

In 2026, the company expects revenue growth of at least 7% or approximately $425 million. It expects revenue dollars to build sequentially through the year. The first quarter is expected to have at least 10% growth compared to the first quarter of 2025. Gross margins are expected to be in the range of 34 to 36% in 2026. It expects at least 30% growth in EBITDA in 2026 compared to 2025, with EBITDA remaining second half weighted.

Coffee markets remained volatile and consumers faced ongoing pressure. Coffee costs were volatile with prices nearly doubling from 2024 to 2025 and remaining elevated. There were tariff - driven shifts in global supply. The company received notice from the New York Stock Exchange regarding the minimum price requirement, which has no immediate impact but has a cure period to regain compliance.

Q: On the coffee side, the land and expand strategy is working, with momentum in the business. Can you help understand the number of SKUs across retail network, penetration at higher level retailers and performance of other coffee products like bagged coffee, K - Cups or Cold Brew?

A: Chris responded that the land and expand strategy is core, they've tripled their number of items on shelf, mentioned largest retailer has 20 items, some national and regional retailers have 14, 12, 8 items respectively, core items drive highest velocities and they'll continue to innovate but didn't talk about specific new products' performance yet.

Q: On the energy side, almost a year into launch, can you share lessons learned and 2026 plans?

A: Chris said first year was a regional launch, saw varying success in different markets, 2026 plan is to have a regional focus, keep a focus on markets where they do best as Black Rifle, focus on strong execution with partners and evaluate best model for marketing and commercialization without over - allocating resources from coffee business.

Q: On coffee bean costs, what to expect on industry prices on shelf and latest price increase?

A: Matt responded that coffee prices moderated in recent months, they took two price increases in 2025 in upper single - digit ranges, consumer response had relatively low elasticity.

Q: Do current military actions change messaging or priorities in marketing?

A: Chris responded that the brand has always been centered around veterans, military actions don't change their marketing messaging or priorities as they've always focused on veterans.