BRC Inc. Reports Third Quarter 2025 Financial Results

Financial Highlights

• Net revenue increased 2.6% compared to Q3 2024, driven primarily by growth in Wholesale revenue.

• Packaged coffee distribution increased 9.1 percentage points to 54.1% All Commodity Volume ("ACV"), and Ready-to-Drink ("RTD") coffee increased 7.3 percentage points to 53.3% ACV in Q3 2025, compared to Q3 2024.

• Net loss was $1.2 million in Q3 2025, a decrease of $0.2 million compared to net loss of $1.4 million in Q3 2024. Adjusted EBITDA was $8.4 million, up $1.3 million from $7.1 million in Q3 2024.

• Full-year revenue, gross margin and adjusted EBITDA guidance updated within prior range.

BRC Inc. (NYSE:BRCC, the ", Company", or ", Black Rifle", )), a Veteran-founded, mission-driven premium beverage company, today announced financial results for the third quarter of fiscal year 2025.

"Black Rifle's third-quarter results highlight strong execution in a dynamic environment as we continue to grow distribution, strengthen retail partnerships, and expand our presence across channels," said BRCC Chief Executive Officer Chris Mondzelewski. "We've delivered meaningful distribution growth in both packaged coffee and our Ready-to-Drink product lines this year, reinforcing the strength of our brand and positioning us well as we build a true multi-category beverage platform. Black Rifle is gaining share across every category where we compete, and we're excited to continue reaching more consumers and accelerating growth into 2026. As we do, we remain deeply committed to advancing our mission to support the military, veteran, and first-responder communities from which we came."

"Our results reflect solid operational and financial discipline that delivered meaningful improvement in underlying profitability compared to the first half of the year," said BRCC Chief Financial Officer Matt Amigh. "Revenue growth outpaced the category, driven by continued execution of our land-and-expand strategy. We're managing a challenging commodity environment with tight cost control, improved operating efficiency, and pricing actions that together are driving stronger margins. In July, we completed an equity offering that enabled us to fully retire the outstanding balance on our revolver and strengthen our liquidity position to support ongoing growth. I'm pleased with the progress we've made since I joined and look forward to driving continued financial and operational gains into next year."

Third Quarter 2025 Financial Highlights (in millions, except % data)

Third Quarter 2025 Results

Net revenue for the third quarter of 2025 increased 2.6% to $100.7 million, compared to $98.2 million in the third quarter of 2024. Wholesale revenue grew 5.3% to $67.0 million in the third quarter of 2025, compared to $63.7 million in the third quarter of 2024. Growth in the Wholesale channel was primarily driven by distribution gains and increased sales volume at food and mass retailers and sales of Black Rifle Energy. These gains were partially offset by a $2.1 million net reduction in barter transaction revenue and lower closeout sales as the Company continued to reduce clearance activity.

Direct-to-Consumer ("DTC") revenue decreased 4.1% to $27.8 million in the third quarter of 2025, compared to $29.0 million in the third quarter of 2024. The decline was primarily driven by lower customer acquisition resulting from the Company's strategic reallocation of advertising spend to higher-return areas of the business. Revenue from Black Rifle Coffee shops ("Outposts") grew 6.0% to $5.8 million in the third quarter of 2025, compared to $5.5 million in the third quarter of 2024. The increase was driven by higher franchise fees and increased average order values at company-operated locations, supported by the promotion of add-on and bundled purchases through Outposts.

Gross profit decreased 10.2% to $37.1 million in the third quarter of 2025, compared to $41.3 million in the third quarter of 2024. Gross margin declined 520 basis points to 36.9% in the third quarter of 2025, down from 42.1% for the third quarter of 2024. The decrease was primarily driven by green coffee inflation and higher trade and slotting adjustments, partially offset by productivity gains and favorable sales mix.

Marketing expenses decreased 13.9% to $8.7 million in the third quarter of 2025, compared to $10.1 million in the third quarter of 2024. As a percentage of revenue, marketing expenses decreased 160 basis points to 8.6% in the third quarter of 2025, compared to 10.3% in the third quarter of 2024. The decline reflects reduced spending on non-working and lower-yield marketing activities as resources were redirected toward programs more directly tied to revenue growth.

Salaries, wages and benefits expenses decreased 13.0% to $14.4 million in the third quarter of 2025, compared to $16.5 million in the third quarter of 2024. As a percentage of revenue, salaries, wages and benefits expenses decreased 260 basis points to 14.3% in the third quarter of 2025 as compared to 16.9% in the third quarter of 2024. The decrease was primarily driven by lower compensation expense resulting from reduced headcount compared to the third quarter of 2024.

General and administrative ("G&A") expenses increased 5.1% to $12.9 million in the third quarter of 2025, compared to $12.3 million in the third quarter of 2024. As a percentage of revenue, G&A increased 30 basis points to 12.9% in the third quarter of 2025 as compared to 12.5% in the third quarter of 2024. The increase was primarily driven by costs related to the change in our third party logistics provider and an increase in depreciation expense as a result of a change in useful life of certain software during the second quarter of 2025, partially offset by lower general and administrative costs resulting from efficiencies gained in corporate infrastructure.

Net loss for the third quarter of 2025 was $1.2 million and Adjusted EBITDA was $8.4 million. This compares to net loss of $1.4 million and Adjusted EBITDA of $7.1 million for the third quarter of 2024.

Financial Outlook

The Company provides the following guidance based on current market conditions and expectations for revenue, gross margin, and adjusted EBITDA. Adjusted EBITDA is a non-GAAP financial measure.

For full-year fiscal 2025, the Company provides the following updated guidance (in millions, except % data):

The guidance provided above constitutes forward-looking statements and actual results may differ materially. Refer to the "Forward-Looking Statements" safe harbor section below for information on the factors that could cause our actual results to differ materially from these forward-looking statements.

We have not reconciled forward-looking Adjusted EBITDA to its most directly comparable GAAP measure, net income (loss), in reliance on the unreasonable efforts exception provided under Item 10(e)(1)(i)(B) of Regulation S-K. We cannot predict with reasonable certainty the ultimate outcome of certain components of such reconciliation, including market-related assumptions that are not within our control, or others that may arise, without unreasonable effort. For these reasons, we are unable to assess the probable significance of the unavailable information, which could materially impact the amount of future net income (loss). See "Non-GAAP Financial Measures" for additional important information regarding Adjusted EBITDA.

Conference Call

A conference call to discuss the Company's third quarter results is scheduled for November 4, 2025, at 8:30 a.m. ET. Those who wish to participate in the call may do so by dialing (877) 407-0609 or (201) 689-8541 for international callers. A webcast of the call will be available on the investor relation's page of the Company's website at ir.blackriflecoffee.com. For those unable to attend the conference call, a replay will be available after the conclusion of the call through November 11, 2025. The U.S. toll-free replay dial-in number is (877) 660-6853, and the international replay dial-in number is (201) 612-7415. The replay passcode is 13755738.

About BRC Inc.

Black Rifle Coffee Company (BRCC) is a Veteran-founded premium coffee company and lifestyle brand serving beverages to people who love America. Founded in 2014 by Green Beret Evan Hafer, Black Rifle develops their explosive roast profiles with the same mission focus they learned while serving in the military. BRCC is committed to supporting Veterans, active-duty military, first responders and the American way of life.

To learn more, visit www.blackriflecoffee.com, subscribe to the BRCC newsletter, or follow along on social media.

Forward-Looking Statements

This press release contains forward-looking statements about the Company and its industry that involve substantial risks and uncertainties. All statements other than statements of historical fact contained in this press release, including statements regarding the Company's intentions, beliefs or current expectations concerning, among other things, the Company's financial condition, liquidity, prospects, growth, strategies, future market conditions, developments in the capital and credit markets and expected future financial performance, as well as any information concerning possible or assumed future results of operations, are forward-looking statements. In some cases, you can identify forward-looking statements because they contain words such as "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "plan," "possible," "potential," "predict," "project," "should," "will," "would" and similar expressions, but the absence of these words does not mean that a statement is not forward-looking.

The events and circumstances reflected in the Company's forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Factors that may cause such forward-looking statements to differ from actual results include, but are not limited to: competition and our ability to grow, manage sustainable expansion, and retain key employees; failure to compete effectively with other producers, distributors and retailers of coffee and energy drinks; our limited operating history, which may hinder the successful execution of strategic initiatives and make it difficult to assess future risks and challenges; challenges in managing rapid growth, inventory needs, and relationships with key business partners; inability to raise additional capital necessary for business development; failure to achieve or sustain long-term profitability; inability to effectively manage debt obligations; failure to maximize the value of assets received through bartering transactions; negative publicity affecting our brand, reputation, or that of key employees; failure to uphold our position as a supportive member of the Veteran, military and first-responder communities, or other factors negatively affecting brand perception; inability to establish and maintain strong brand recognition through intellectual property or other means; shifts in consumer spending, lack of interest in new products or changes in brand perception upon evolving consumer preferences and tastes, including due to shifts in demographic or health and wellness trends, reduction in discretionary spending and price increases, and our ability to anticipate or react to these changes; price changes that are insufficient to offset cost increases and maintain profitability or that result in sales volume declines associated with pricing elasticity; unsuccessful marketing campaigns that incur costs without attracting new customers or realizing higher revenue; failure to attract new customers or retain existing customers; risks associated with reliance on social media platforms, including dependence on third-party platforms for marketing and engagement; declining performance of the direct to consumer revenue channel; inability to effectively manage or scale distribution through Wholesale business partners, particularly key Wholesale partners; failure to manage supply chain operations effectively, including inaccurate forecasting of raw material and co-manufacturing requirements; loss of one or more co-manufacturers or production delays, quality issues, or labor-related disruptions affecting manufacturing output; supply chain disruptions or failures by third-party suppliers to deliver coffee, store supplies, RTD beverage ingredients, or merchandise, including disruptions caused by external factors; ongoing risks related to supply chain volatility and reliability, including tariffs, political and climate risks; fluctuations in the market for high-quality coffee beans and other key commodities; unpredictable changes in the cost and availability of real estate, labor, raw materials, equipment, transportation, or shipping; failure to successfully improve profitability of existing Black Rifle Coffee shops, including challenges or delays with the implementation of operational and strategic changes; risks related to long-term, non-cancelable lease obligations and other real estate-related concerns; inability of franchise partners to successfully operate and manage their franchise locations; failure to maintain high-quality customer experiences for retail partners and end users, including production defects or issues caused by co-manufacturers that negatively impact product quality and brand reputation; failure to comply with food safety regulations or maintain product quality standards; difficulties in successfully expanding into new domestic and international markets; failure to comply with federal, state, and local laws and regulations, or inability to prevail in civil litigation matters; risks related to potential unionization of employees; failure to execute our operational improvement plan to reduce costs and improve efficiency of certain company-wide functions; failure to protect against cybersecurity threats, software vulnerabilities, or hardware security risks; and other risks and uncertainties indicated in our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the Securities and Exchange Commission (the "SEC") on March 3, 2025 including those set forth under "Item 1A. Risk Factors" included therein, as well as in our other filings with the SEC. Such forward-looking statements are based on information available as of the date of this press release and the Company's current beliefs and expectations concerning future developments and their effects on the Company, and speak only as of the date hereof. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not place undue reliance on these forward-looking statements as predictions of future events. Although the Company believes that it has a reasonable basis for each forward-looking statement contained in this press release, the Company cannot guarantee that the future results, growth, performance or events or circumstances reflected in these forward-looking statements will be achieved or occur at all. The Company does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

Non-GAAP Financial Measures

To evaluate the performance of our business, we rely on both our results of operations recorded in accordance with generally accepted accounting principles in the United States ("GAAP") and certain non-GAAP financial measures, including EBITDA, and Adjusted EBITDA. These measures, as defined below, are not defined or calculated under principles, standards or rules that comprise GAAP. Accordingly, the non-GAAP financial measures we use and refer to should not be viewed as a substitute for performance measures derived in accordance with GAAP. Our definitions of EBITDA and Adjusted EBITDA described below are specific to our business and you should not assume that they are comparable to similarly titled financial measures of other companies.

We define EBITDA as net income (loss) before interest, tax expense, depreciation and amortization expense. We define Adjusted EBITDA, as EBITDA adjusted for equity-based compensation, system implementation costs, write-off of site development costs, non-routine legal expenses, transaction expenses, and restructuring fees and related costs. Investors should note that, beginning with results for the quarter ended March 31, 2025, we have modified the presentation of Adjusted EBITDA to no longer exclude RTD transformation costs and executive recruiting. To conform to the current period's presentation, we have excluded RTD transformation costs and executive recruiting when presenting Adjusted EBITDA for the three and nine months ended September 30, 2024. This change did not decrease Adjusted EBITDA for the three months ended September 30, 2024, but did decrease Adjusted EBITDA by $2.5 million for the nine months ended September 30, 2024.

When used in conjunction with GAAP financial measures, we believe that EBITDA and Adjusted EBITDA are useful supplemental measures of operating performance and liquidity because these measures facilitate comparisons of historical performance by excluding non-cash items such as equity-based compensation and other amounts not directly attributable to our primary operations, such as system implementation costs, write-off of site development costs, non-routing legal expense, and restructuring fees and related costs. Adjusted EBITDA is also a key metric used internally by our management to evaluate performance and develop internal budgets and forecasts. EBITDA and Adjusted EBITDA have limitations as an analytical tool and should not be considered in isolation or as a substitute for analyzing our results as reported under GAAP and may not provide a complete understanding of our operating results as a whole. Some of these limitations are (i) they do not reflect changes in, or cash requirements for, our working capital needs, (ii) they do not reflect our interest expense or the cash requirements necessary to service interest or principal payments on our debt, (iii) they do not reflect our tax expense or the cash requirements to pay our taxes, (iv) they do not reflect historical capital expenditures or future requirements for capital expenditures or contractual commitments, (v) although equity-based compensation expenses are non-cash charges, we rely on equity compensation to compensate and incentivize employees, directors and certain consultants, and we may continue to do so in the future and (vi) although depreciation, amortization and impairments are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and these non-GAAP measures do not reflect any cash requirements for such replacements.

A reconciliation of net loss, the most directly comparable GAAP measure, to EBITDA and Adjusted EBITDA is set forth below:

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Investor Contacts:

Matt McGinley: [email protected]

ICR for BRCC: [email protected]