Byrna Lifts Margins and Retools Its Marketing as Fiscal Third-Quarter Revenue Declines

Byrna Technologies Inc. (NASDAQ: BYRN), a personal defense technology company that makes less-lethal personal security products, reported results on October 8, 2026 for its fiscal third quarter ended August 31, 2026. Net revenue fell to $15.3 million from $28.2 million a year earlier, while adjusted gross margin improved to about 65% as the company continued reworking its marketing, distribution and manufacturing.

Revenue Slows as Retail Reorders Ease

According to the company, the roughly 46% revenue decline came mainly from lower e-commerce sales and slower reorders from dealers and chain stores. Those retailers had restocked heavily in fiscal Q1, and sell-through since then has been slower than expected.

As a result, Byrna posted a net loss of $2.9 million for the quarter, compared with net income of $2.2 million a year earlier. Adjusted EBITDA came in at a loss of $1.4 million, versus a positive $4.1 million in the prior-year quarter. Operating expenses rose 7% to $15.1 million, reflecting new marketing initiatives and $1.7 million in other one-time costs, partly offset by lower variable selling expenses.

Margin Gains From Mix and Outsourcing

Gross margin moved in the other direction. Reported gross margin reached 79%, up from 60%, including a one-time $2.3 million tariff refund. Excluding that refund, adjusted gross margin was about 65%. Byrna attributed the improvement mainly to manufacturing efficiency gains on its launchers and a continued shift toward higher-margin products.

The company also moved ammunition production to an outsourced model during the quarter. That change improved ammunition gross margins by about 1,200 basis points and reduced operational complexity, according to Byrna. In addition, it sold through all available refurbished product inventory, adding incremental earnings and a longer-term revenue channel.

Building Toward the Holiday Season

In recent months, Byrna has laid groundwork for its busiest selling period. The company completed its acquisition of HERO Defense Systems, a less-lethal self-defense company, which adds new price points and form factors. It also onboarded more than 50 creators with a combined 3.8 million followers and launched a campaign with The Bobby Bones Show through iHeartMedia to reach mainstream consumer audiences.

Early digital signs are moving up. CEO Conn Davis said the company averaged more than 29,000 website sessions per day in August, its highest since March, and that website conversion improved from June to August. Byrna also added two senior vice presidents for retail and marketing and appointed two new directors during the period.

“Heading into our critical holiday sales season, we believe we have established a foundation for many of the transformation initiatives and are now focused on executing against them and building momentum,” Davis said. Byrna ended the quarter with $9.4 million in cash, cash equivalents and marketable securities and $30.0 million in inventory, which it expects to keep normalizing through the holiday period.

Strategic Investment Summary

• Quarterly Revenue: Byrna Technologies (NASDAQ: BYRN) reported fiscal Q3 2026 net revenue of $15.3 million, down from $28.2 million a year earlier.
• Margin Expansion: Adjusted gross margin rose to about 65% from 60%, excluding a one-time $2.3 million tariff refund.
• Ammunition Outsourcing: Moving ammunition production to an outsourced model improved ammunition gross margins by about 1,200 basis points.
• Profitability: The company reported a net loss of $2.9 million and adjusted EBITDA of negative $1.4 million for the quarter.
• Growth Initiatives: Byrna closed the HERO Defense Systems acquisition and expanded its creator and media partnerships ahead of the holiday season.
• Balance Sheet: Cash, cash equivalents and marketable securities totaled $9.4 million, with inventory of $30.0 million at quarter-end.

Find out more about the latest corporate developments and financial reports at the Byrna Technologies investor portal.