Byrna Technologies (NASDAQ:BYRN) reported a steep year-over-year decline in fiscal second-quarter revenue as weaker e-commerce traffic, lower conversion rates and slower retail reorders weighed on results, while management described the period as a “reset” tied to a broader overhaul of the company’s marketing, retail and operating structure.
Chief Executive Officer Conn Davis said the company’s fiscal second quarter ended May 31, 2026, “came in below our expectations” and did not reflect what management believes Byrna can deliver. Revenue was $16.4 million, down from $28.5 million in the prior-year period.
“The quarter ultimately became a steeper reset than we originally expected,” Davis said. “The results reinforced why the transformation underway is necessary and why we are moving with urgency.”
Revenue Declines Across Major Channels
Chief Financial Officer Lauri Kearnes said e-commerce sales through Byrna’s website and Amazon fell by $5.8 million, or 35%, compared with the prior-year period, due to reduced traffic and lower conversion rates. Domestic dealer channel sales, including dealers, distributors and chain stores, declined $3.5 million, or 47%, driven mainly by slower reorder activity after substantial fiscal first-quarter restocking and weaker-than-expected sell-through.
International dealer and distributor product sales fell $1.2 million, or 43%, due to large orders in the prior-year quarter that did not repeat in the current year.
Davis provided additional detail on e-commerce trends, saying byrna.com generated about 2.6 million sessions in the quarter, down 13% year over year. Conversion averaged 0.59%, compared with 1% in the year-ago quarter, while average order value declined 19% to about $302. Sessions fell from about 1.1 million in March to roughly 783,000 in April and 779,000 in May.
During the quarter, Davis said Byrna continued to spend through historical media and influencer relationships, but those channels produced less traffic and fewer purchases. He said the company is now working to address both customer acquisition and the on-site experience after consumers arrive at byrna.com.
Write-Downs Weigh on Reported Profitability
Byrna reported gross profit of $1.8 million, or 11% of net revenue, compared with $17.6 million, or 62% of net revenue, in the prior-year period. Kearnes said reported gross margin included a one-time $3.6 million inventory write-down, a $3.5 million impairment loss on manufacturing equipment and a $2.3 million inventory reserve tied to strategic product rationalization. Those items were partly offset by a $1.1 million tariff refund recorded in cost of goods sold.
Excluding those items, adjusted gross profit was $10.1 million, representing adjusted gross margin of about 62%. Kearnes said Byrna expects adjusted gross margin to remain near or above that level through the balance of the year.
The $3.6 million inventory write-down and $3.5 million impairment loss were directly related to the closure of Byrna’s Fort Wayne ammunition manufacturing facility, Kearnes said. The $2.3 million inventory reserve involved finished goods and raw materials that will either be end-of-lifed or not used because of engineering process changes.
Operating expenses were $14.6 million, up 3% from $14.2 million in the prior-year quarter. The increase primarily reflected a $1 million impairment charge and continued marketing investment, partly offset by lower variable selling expenses tied to lower sales.
Byrna posted a net loss of $10.1 million, compared with net income of $2.4 million in the prior-year quarter. Adjusted EBITDA was negative $600,000, compared with positive $4.3 million a year earlier.
Cash, cash equivalents and marketable securities totaled $10.4 million at quarter end, compared with $9.6 million at Feb. 28, 2026, and $15.5 million at Nov. 30, 2025. Kearnes said accounts receivable collections supported cash during the quarter. Byrna ended the quarter with no debt.
Management Outlines Reset Plan
Davis said Byrna’s near-term priorities are improving consumer conversion and retail productivity, changing how the company builds demand, and linking demand more closely to production, inventory and cash generation.
On the digital side, Davis highlighted Byrna’s “Find the Right Launcher” online experience, which has generated more than 150,000 completed responses. He said consumers who complete the quiz convert at about twice the rate of the overall website, and Byrna is using the data to improve product comparisons, landing pages, onboarding and follow-up communications. The company expects to launch personalized guided product selection experiences across byrna.com within two weeks, he said.
Davis also discussed Byrna’s limited “Try Before You Buy” program, under which consumers pay $50 to receive a demonstration unit, training ammunition, CO2 and educational materials for a two-week trial. The fee becomes a purchase credit. Davis said the program has generated conversion near 30%, though it has been small and has not yet meaningfully contributed to revenue. Byrna is expanding the next phase to allow eight times as many consumers to participate.
In retail, Davis cited a test with one premier chain partner that moved Byrna from basic shelf placement to dedicated end caps in more than 20 stores. Before the change, the partner averaged about $81,000 in monthly purchases. Purchases rose to about $200,000 in April, the first full month after the rollout and expanded assortment, Davis said.
Marketing Shift and HERO Acquisition
Davis said Byrna has historically relied too heavily on a narrow audience and lacked visibility into which messages, media channels and partnerships created customers. With support from HLK, the company has identified priority consumer segments including personal safety-minded urban professionals, security-minded suburban homeowners and preparedness-focused outdoor enthusiasts. Davis said those segments represent more than 50 million likely buyers Byrna has not historically addressed in a focused way.
The company is shifting toward safety- and use-case-first messaging across areas such as home protection, outdoor activity, travel and small business activity. Davis said Byrna separated its marketing and sales functions in June to create clearer accountability and faster responses to performance issues.
Byrna also discussed its definitive agreement to acquire HERO Defense Systems. Davis said HERO would add complementary less-lethal products that sit below and adjacent to Byrna’s launcher platform, including the HERO 2020 irritant launcher and AIIRO pepper gel platform. The transaction includes $625,000 in cash, $625,000 in restricted Byrna shares and a performance-based royalty tied to future net sales of HERO products and derivative products. Byrna expects the deal to close within about 30 days, subject to customary conditions.
In response to analyst questions, Davis said HERO products could help Byrna address a gap between its roughly $20 sprays and its SD launcher at about $400, with a potential product solution around the $250 range after cost reductions. Kearnes said HERO had been profitable as a small company and that margins were similar to Byrna’s, though integration work remains ahead.
Outlook: No Revenue Growth Year Expected
Davis said fiscal 2026 “will not be a revenue growth year,” adding that the second quarter reset the revenue baseline. Management expects improvement from the first half to the second half as retailers prepare for the holidays and new marketing and consumer acquisition initiatives enter the market.
He said the third quarter remains a transition period, while the company expects the fourth quarter to improve with holiday season activity and broader deployment of its marketing, conversion and retail initiatives.
Byrna reduced launcher assembly from four production lines to two in May and stopped manufacturing ammunition in-house after determining that qualified external suppliers can produce ammunition at lower fully loaded cost. Davis said the company is now producing below the current sales rate to reduce inventory while preserving the ability to add capacity if demand improves.
Kearnes said Byrna expects cash to hold through the third quarter and is targeting a $5 million inventory reduction in the fourth quarter to generate cash. She said the company expects to end the year with more cash than it currently has, while remaining debt-free.
About Byrna Technologies (NASDAQ:BYRN)
Byrna Technologies, Inc (NASDAQ: BYRN) designs, develops and markets non-lethal personal security devices and accessories intended to provide an alternative to traditional firearms. The company’s flagship offerings deploy impact projectiles and chemical irritants in a compact, pistol-style form factor. Its product portfolio includes the Byrna SD and Byrna HD launchers, which utilize proprietary kinetic and irritant cartridges, as well as the lightweight Byrna Air, a CO₂-powered variant optimized for close-quarters defense.
In addition to its core self-defense launchers, Byrna Technologies supplies a range of consumables and support products, including cartridges loaded with pepper-based irritants, inert training rounds, holsters, safe-carry cases and speed loaders.
