Grove Collaborative Holdings, Inc. Q2 FY2026 earnings call

• Core Financial Performance & Discipline • Q2 2026 net revenue was $36.6 million, down 16.9% year-over-year but up 1% quarter-over-quarter, in line with management expectations that Q1 2026 was the annual revenue trough • Adjusted EBITDA was positive $0.5 million (1.3% margin), marking the third consecutive quarter of positive adjusted EBITDA • Operating cash flow was positive $1.3 million, and total cash, cash equivalents, and restricted cash stood at $11.4 million at quarter end, up $1 million from Q1 2026 • Total operating expenses were down 27% year-over-year, driven by structural headcount reductions, improved outbound shipping costs from an updated carrier strategy, and company-wide cost optimization • Net loss for the quarter was $0.9 million (2.5% loss margin), a significant improvement from a $3.6 million (8.2% loss margin) net loss in Q2 2025

• Strategic Pillar Progress • Sustainable profitability: Maintained expense discipline to balance top-line growth and bottom-line performance, with three straight quarters of positive adjusted EBITDA • Balance sheet strength: Built liquidity through operational cash generation and inventory reduction, with management confirming the company has sufficient liquidity to fund its full 2026 business plan • Revenue growth stabilization and expansion: New dropship capabilities allow expansion into larger new categories (including mattresses, air and water purification systems) without incurring traditional inventory ownership costs, supporting assortment growth while maintaining balance sheet discipline. Launched a fully updated subscription experience, which is core to the business (included in over 80% of orders) that lets customers customize full basket deliveries to their preferred cadence. Growing non-D2C presence, especially Amazon's first-party Grove brand business, with a focus on capturing additive market share of consumers seeking trusted clean products without cannibalizing D2C operations. Increased advertising spend slightly sequentially to 3.4% of revenue, with plans for disciplined future increases; D2C net revenue per order grew 6.1% year-over-year driven by category expansion, improved promotional efficiency from the Grove Green Rewards loyalty program, and lapping a prior-year small-order test that did not repeat in Q2 2026 • Refocused mission on human and environmental health: Shifted prioritization to center human health, maintaining the industry's most stringent product curation standards with thousands of banned harmful ingredients. Published the 2025 Annual Sustainability Report, noting a new company-low plastic intensity of 0.9 pounds per $100 of net revenue, over 18.7 million pounds of plastic collected to date via Repurpose Global, and over 8.5 million pounds of plastic avoided by customer adoption of plastic-reduction products

• Leadership Update • CFO Tom Siragusa will leave the company on August 16, 2026 to pursue a new opportunity; the search for a permanent successor is underway

Grove divides its business along two core distribution segments: D2C (direct-to-consumer) and non-D2C. For Q2 2026, total company net revenue was $36.6 million, accounting for 100% of total revenue. Non-D2C channels (including Amazon and QVC) drove the 1% sequential quarterly revenue growth, with positive revenue expansion that offset a slight decline in D2C revenue. D2C segment: 489,000 total orders, a 23.6% year-over-year decline; 509,000 active customers at quarter end, a 23.3% year-over-year decline; D2C net revenue per order reached $69.19, a 6.1% year-over-year increase. No explicit absolute revenue values are provided for each individual segment in the call transcript.

• Management reaffirms the full-year 2026 guidance that was raised after Q1 2026, with no upward or downward revision to prior ranges • Full-year 2026 net revenue is expected to be between $142.5 million and $152.5 million • Full-year 2026 adjusted EBITDA is expected to range from break-even to positive low single-digit millions • Management maintains its expectation of sequential net revenue improvement for each remaining quarter of 2026 • Advertising spending is expected to grow at a disciplined pace in future quarters as the company leverages improved customer experience to support new customer acquisition

• Forward-looking statements (including those related to growth plans, investment returns, and future performance) are subject to inherent risks and uncertainties that could cause actual results to differ materially from expectations, with additional risks detailed in the company's SEC filings • Year-over-year revenue decline reflects lagging negative impacts from prior reduced advertising investment and customer attrition tied to 2025 e-commerce platform migration disruptions, and reaccelerating revenue remains an ongoing key challenge • The company's early-stage expansion into Amazon sales requires close monitoring to confirm it delivers additive growth rather than D2C cannibalization

No questions were submitted by call participants during the Q&A portion of this earning call, so there are no exchanges to summarize.