Cricut, Inc. Q1 FY2026 earnings call

Q1 began to see early benefits of platform-first strategy. Launched new machines and first service offering. Pleased with user growth, profitability, platform revenue growth, but total company sales declined. Priorities include broadening awareness, addressing barriers of ease of use and affordability, investing in onboarding and bundles. Saw progress in marketing, platform innovation, engagement, with paid subscribers increasing and new service offering having encouraging early response.

In Q1, revenue was $159.5 million, a 2% decline compared to the prior year. Platform revenue in Q1 2026 was $84.8 million, up nearly 6% year-over-year. Product revenue was $74.7 million, down 9.6% year-over-year. International sales grew over 16% year-on-year to $40.9 million, representing 26% of total revenue in Q1 2026. Platform gross margin was 89%, product gross margin was 23.1%.

Focused on accelerating investments in R&D, new product launches, and marketing including international markets. Expect Q2 total company revenue not to grow year over year. Platform revenues expected to grow each quarter. Confident in growth in the second half. Expect to be profitable each quarter and generate cash flow from operations for full year 2026. Continue with $50 million stock repurchase program and semiannual dividend.

Tariff uncertainty, input costs, supply chain dynamics, cautious consumer environment in certain markets.

First question from Eric Woodring related person about product revenue decline, first half performance and second half confidence. Second question from Adrian Yee related person about retail behavior, app store payments, IEPA-related tariff refunds and their impacts.