GrowGeneration Q2 2026 Earnings Call Transcript

Quartr
Provided by Quartr
August 11, 2026

Key Takeaways

  • Positive Sentiment: Revenue increased 5.5% year over year to $43.2 million, marking GrowGeneration’s third consecutive quarter of annual growth, driven primarily by commercial B2B activity and proprietary brands.
  • Positive Sentiment: Proprietary brands reached 39.7% of cultivation and gardening revenue, up from 32% a year earlier and already meeting the company’s 40% year-end target; management expects further expansion across commercial, cannabis, lawn-and-garden, and agricultural channels.
  • Positive Sentiment: Adjusted EBITDA was positive at $0.3 million versus a $1.3 million loss last year, while gross margin improved to 28.5% and operating expenses declined 13.1% year over year.
  • Positive Sentiment: Management raised full-year 2026 adjusted EBITDA guidance to $2 million-$3 million while maintaining revenue guidance of $162 million-$168 million; third-quarter revenue is expected at $44 million-$46 million with positive adjusted EBITDA.
  • Neutral Sentiment: The company ended the quarter with $41 million in cash and no debt, repurchased 700,000 shares, and has approximately $9 million remaining under its buyback authorization, while noting that more than $2 million of expected IEEPA tariff refunds will benefit third-quarter results and that Q3 revenue may decline year over year due to an unusually strong comparable period.
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Earnings Conference Call
GrowGeneration Q2 2026
00:00 / 00:00

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Operator

This conference call is being recorded, and a replay of today's call will be available on the investor relations section of GrowGeneration's website. I will now hand the call over to Phil Carlson with KCSA Strategic Communications for introduction and the reading of the safe harbor statement. Please go ahead, Phil.

Phil Carlson
Managing Director of Investor Relations at KCSA Strategic Communications

Thank you, operator, and welcome everyone to GrowGeneration's second quarter 2026 earnings results conference call. With us today from GrowGeneration are Darren Lampert, Co-founder and Chief Executive Officer, and Greg Sanders, Chief Financial Officer. The company's second quarter 2026 earnings press release was issued after close of market today. A copy of this press release is available on the investor relations section of the GrowGeneration website at ir.growgeneration.com. I would like to remind everyone that certain comments made on this call include forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's current expectations and beliefs concerning future events and are subject to several risks and uncertainties that could cause actual results to differ materially from those described in these forward-looking statements.

Phil Carlson
Managing Director of Investor Relations at KCSA Strategic Communications

Please refer to today's press release and other filings with the SEC for a detailed discussion of the risks that could cause actual results to differ materially from those expressed or implied in any of the forward-looking statements made today. During the call, we will use some non-GAAP financial measures as we describe business performance. The SEC filing, as well as the earnings press release, which provide reconciliations of non-GAAP financial measures to the most directly comparable GAAP measures, are all available on our website. Following the prepared remarks, management will be happy to take your questions. We ask that you please limit yourself to one question and one follow-up. If you have additional questions, please reenter the queue and we will take them as time allows. Now, I will hand the call over to GrowGeneration's Co-founder and CEO, Darren Lampert. Darren, please go ahead.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

Thanks, Phil, and good afternoon, everyone. Thank you for joining us to review GrowGeneration's second quarter 2026 financial results and to discuss our outlook for the rest of 2026. I am pleased to report that our sales momentum in early 2026 continued into the second quarter. This marks our third consecutive quarter of year-over-year revenue growth following the actions we have taken over the past few years as part of our larger strategy to transform GrowGeneration into a commercial proprietary brand-driven business. This growth strategy is centered around three key priorities: expanding our commercial platform, growing our proprietary brands, and maintaining a disciplined cost structure. Our expanded commercial B2B business is the core growth driver of our strategy. Through our digital B2B platform, GrowGen Pro, we have strengthened our relationships with both single and multi-state operators, greenhouse growers, and many other commercial cultivation customers throughout North America.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

These customers recognize the value we provide, with many of them adopting our products and growing protocols into their operations. Another key component of our strategy is growing our proprietary brands across additional channels. Aside from building stronger brand loyalty, proprietary brand sales also represent higher margins, recurring consumable purchases, and create greater competitive differentiation for GrowGen in the marketplace. Our efforts have been very successful as we continue to see increased adoption of proprietary brands such as Char Coir, Drip Hydro, The Harvest Company, Dialed In, and Power Si. With this strategy, we set certain goals for ourselves in 2026, including proprietary brand penetration, reaching 40% of Cultivation and Gardening revenue by year-end. Based on our performance to date, we have updated our full year adjusted EBITDA goal and now expect to generate adjusted EBITDA in the range of $2 million-$3 million.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

This is significant for GrowGeneration as it shows the progress we have already made, as well as the ongoing evolution of our business as we set the bar higher in order to keep driving revenue growth, reduce costs, and improve margins. Now, let's look at our second quarter results. We generated total revenue of $43.2 million, which was in line with our expectations and represents both sequential and year-over-year growth, even as we operated with a smaller retail store footprint. We reported proprietary brand sales representing approximately 40% of Cultivation and Gardening revenue, compared to 32% the same period last year. We are already at our year-end target mix just halfway through the year. In addition to reaching this target, these results represent our progress in building a more focused, commercially driven, and profitable business.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

We have continued to transition our sales towards higher value, recurring consumable proprietary branded products. Expanding proprietary brands is central to our margin expansion and long-term value creation strategy, and we are very pleased with our progress. Our MMI Storage Solutions segment also delivered solid results this quarter, with $8.3 million in revenue. MMI continues to benefit from higher capital investment activity and its diversification into industrial, agricultural, and specialty end markets. We expect this segment will continue to generate steady growth throughout the remainder of 2026. All this has contributed to expanded margins. For the second quarter, we achieved gross profit margins of 28.5%, a sequential improvement of 310 basis points from 25.4% last quarter and compared to 28.3% last year. Turning to expenses for the quarter, we reduced store and other operating expenses by approximately 22% year-over-year and total expenses by 13%.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

These results display the considerable benefits we have achieved from the increased efficiency and cost reduction initiatives that we have been implementing over the past several years. All of this contributed to GrowGen achieving positive adjusted EBITDA for the second quarter. As I mentioned earlier, this is an important milestone for us. Aside from increased profitability, it demonstrates the value we have created through our strategic initiatives as we continue to transform ourselves into a stronger business with increased growth prospects. I'm not just talking about the operational improvements we've made. I'm also talking about our emphasis on revenue quality. We're growing higher margin sales as part of our revenue mix, particularly through our proprietary brands.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

Also, attaining positive adjusted EBITDA this quarter has now led us to reach even higher, as we have raised our full year 2026 adjusted EBITDA goal to the range of $2 million-$3 million. As part of this strategy, we have also continued to maintain a strong balance sheet. Today, we possess one of the strongest balance sheets within our industry. This financial flexibility gives us a considerable competitive advantage as we seek further infrastructure projects and take steps to increase our proprietary brand expansion. At quarter end, we had $41 million of cash while having no debt. We have the resources to keep investing in our growth initiatives while still maintaining disciplined capital allocation. This financial strength also supports our stock repurchase activity. During the second quarter, we repurchased 700,000 shares of common stock at an average price of $1.38 per share.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

Regarding our forward outlook, for the third quarter of 2026, we anticipate revenue of between $44 million-$46 million. At the same time, we expect to generate positive adjusted EBITDA for the quarter. This gives us the confidence to upgrade our full year 2026 guidance, which includes net revenue in the range of $162 million-$168 million and adjusted EBITDA in the range of $2 million-$3 million for the full year. Before I turn the call over to Greg, I want to give some perspective on the latest developments around Schedule III rescheduling for adult use cannabis. Since our last earnings call, the ALJ concluded its formal hearings. While our ruling is still pending, we are confident that regardless of timing, GrowGen is well-positioned to support increased investment activity from our customers.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

We believe there is no other organization better suited for this with our growing portfolio of proprietary brands, infrastructure builds, and system integrations, longstanding customer partnerships, and our talented and seasoned management team. All of this is supported by our industry-leading balance sheet and proven track record of execution. That concludes my remarks. Now I'll turn the call over to our CFO, Greg Sanders.

Greg Sanders
Greg Sanders
CFO at GrowGeneration

Thank you, Darren, and good afternoon, everyone. I'll begin with a review of our second quarter 2026 results, and then I'll provide additional context on our outlook for the year. Our second quarter results represent another step forward in the transformation of GrowGeneration. We delivered our third consecutive quarter of year-over-year growth, continued expansion of proprietary brand penetration, delivered positive adjusted EBITDA, and maintained a disciplined cost structure that we've built over the past several years. These results reflect continued execution against the strategic priorities that we've outlined to investors. For the second quarter of 2026, GrowGeneration reported net sales of $43.2 million, an improvement of 12.6% sequentially and an increase of 5.5% compared to $41 million during the same period last year.

Greg Sanders
Greg Sanders
CFO at GrowGeneration

Revenue growth continues to be driven primarily by our commercial B2B business and increasing adoption of our proprietary brands, both of which remain strategic priorities for the company. Net sales in our Cultivation and Gardening segment were $34.9 million for the quarter, compared to $32.9 million in the same period last year. Proprietary brand sales represented 39.7% of Cultivation and Gardening revenue, up from 32% in the prior year. This was mainly driven by our strategic initiative to increase our sales mix of higher-margin proprietary products. Higher proprietary brand penetration continues to improve the quality of our revenue by increasing gross profit dollars and reinforcing our long-term margin expansion strategy. In our Storage Solutions segment, net sales were $8.3 million for the quarter, up from $8.1 million in the second quarter of 2025. Storage Solutions continues to provide an increasingly diversified revenue stream outside of traditional cultivation markets.

Greg Sanders
Greg Sanders
CFO at GrowGeneration

We continue to see healthy customer demand across retail, industrial, and commercial infrastructure projects, reflecting ongoing investment in warehouse modernization and automation. This diversification helps reduce earnings volatility while providing additional opportunities for profitable growth. Gross profit was $12.3 million for the second quarter of 2026, compared to $11.6 million during the same period last year. In Cultivation and Gardening, gross profit increased year-over-year, primarily due to increased sales volume and a higher mix of proprietary brand products. Storage Solutions gross profit dollars declined modestly due to project mix and rising transportation costs during the quarter, despite higher sales volume. Total company gross margin was 28.5% compared to 28.3% last year. The improvement reflects the continued expansion of proprietary brand sales within our Cultivation and Gardening segment, partially offset by higher transportation costs. Now turning to expenses.

Greg Sanders
Greg Sanders
CFO at GrowGeneration

In the second quarter of 2026, store and other operating expenses declined by approximately 21.9% to $6.1 million, compared to $7.9 million in the second quarter of 2025, reflecting the benefits of our cost reduction initiatives. Selling, general, and administrative expenses were $6.5 million, or a 5% increase compared to $6.2 million last year, primarily due to increases in our commercial sales structure that support our growth initiatives. Total operating expenses decreased by $2.2 million, or 13.1%, to $14.7 million, compared to $16.9 million in the comparable 2025 period. Depreciation and amortization totaled $1.5 million, down $1.2 million, or 44%, compared to $2.7 million in the same period last year. The decrease primarily reflects asset retirements related to cost reduction initiatives and certain intangible assets reaching the end of their useful lives.

Greg Sanders
Greg Sanders
CFO at GrowGeneration

GAAP net loss decreased to $2 million, or negative $0.03 per share, a $2.8 million improvement compared to a net loss of $4.8 million, or negative $0.08 per share in the prior year period. The improvement was primarily driven by reduced operating expenses, revenue growth, and lower depreciation and amortization. In the second quarter, as expected, we returned to positive adjusted EBITDA. Non-GAAP adjusted EBITDA, as defined in our press release, was a positive $0.3 million, a $1.6 million year-over-year improvement compared to a loss of $1.3 million in the prior year. Returning to positive adjusted EBITDA marks an important milestone in the transformation of GrowGeneration. Over the past several years, we have sustainably reduced our cost structure, improved operating leverage, and positioned the business to return to sustainable profitability as revenue continues to recover. Now turning to the balance sheet.

Greg Sanders
Greg Sanders
CFO at GrowGeneration

We ended the quarter with $41 million of cash, cash equivalents, and marketable securities, and no debt. Our debt-free balance sheet continues to differentiate GrowGeneration within the industry and provides us with significant flexibility to invest in organic growth, evaluate strategic opportunities, and opportunistically return capital to shareholders. Earlier this year, our Board of Directors authorized a share repurchase program of up to $10 million of the company's outstanding common stock, reflecting the board's confidence in the long-term intrinsic value of the business and our commitment to disciplined capital allocation. During the second quarter, the company repurchased 700,000 shares of common stock at an average price of $1.38 per share, exclusive of incremental direct costs. As of June 30th, 2026, approximately $9 million remains available under the stock repurchase program.

Greg Sanders
Greg Sanders
CFO at GrowGeneration

We intend to execute the program opportunistically during the remainder of 2026, subject to market conditions, capital allocation priorities, and applicable securities law. Now turning to our outlook. We are raising our full year 2026 adjusted EBITDA guidance while reaffirming our revenue outlook. We continue to expect net revenue in the range of $162 million-$168 million and now expect adjusted EBITDA in the range of $2 million-$3 million for the full year, compared to our previous expectation of approximately breakeven. The increase reflects our strong execution year to date, continued focus on revenue quality, proprietary brand penetration, disciplined cost management, and the expected recognition of previously incurred IEEPA tariff refunds during the third quarter. For the third quarter, we expect net revenue in the range of $44 million-$46 million while continuing to generate positive adjusted EBITDA.

Greg Sanders
Greg Sanders
CFO at GrowGeneration

As we look ahead, we believe GrowGeneration is operating from a position of strength. We have returned the business to revenue growth, materially improved profitability, maintained a strong debt-free balance sheet, and continue to execute a disciplined long-term strategy. While there is still work ahead, we believe the progress we've made over the past several years has established a much stronger foundation for long-term shareholder value creation. With that, I'll turn the call back to Darren for closing remarks.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

Thanks, Greg, and thank you again to everyone for joining us today. Overall, we delivered a strong second quarter, generating revenue growth across most areas of our business, expanding proprietary brand penetration, reducing costs, and improving profitability while reaching a positive adjusted EBITDA for the quarter. Our performance continues to reflect the benefits of our expanding commercial platform and our improved operations and reduced cost structure. This also enables us to once again end the quarter with a strong balance sheet and no debt. Moving forward, we will remain focused on executing our strategy and continuing our transformation into a commercial proprietary brand-driven business.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

We will stay focused on driving continued revenue growth while refining our revenue mix, improving margins, and expanding our profitability as we continue to advance towards our year-end goal of proprietary brands representing 40% of Cultivation and Gardening sales, and our updated goal of generating full-year adjusted EBITDA in the range of $2 million-$3 million. As you can see from this quarter's performance, our strategy is continuing to drive improved financial and operating results, and we look forward to keeping you updated as we make further progress during the balance of the year. That concludes our prepared remarks. Operator, please open the line for questions.

Operator

Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. Should you have a question, please press the star followed by the one on your touch-tone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press the star followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys. We ask that you limit yourselves to one question and one follow-up question. Your first question comes from Aaron with Alliance Global Partners. Please go ahead.

Aaron Grey
Aaron Grey
Analyst at Alliance Global Partners

Hi, good evening, and thank you very much for the questions. First question from me, just regarding the updated guide, particularly on EBITDA. You guys held sales and gross margin guide, increased EBITDA. It implies $3.3 million to about $4.3 million in the back half. Just given the seasonal softness we usually see in 4Q, how much of it is attributable to just a really strong core 3Q, maybe less seasonality, versus that tariff benefit that you mentioned as well? Thank you.

Greg Sanders
Greg Sanders
CFO at GrowGeneration

Hi, Aaron. Thank you for the question. I think first things first, the first two quarters gave us a higher level of confidence in the underlying performance of the business. Returning the company to positive adjusted EBITDA in the second quarter, along with returning gross margin to 28.5%, and the cost reduction initiatives that we've executed gives us more confidence in the operating model as we move forward. In addition to our comfort around the business and our execution so far year to date, we are expecting an IEEPA tariff amount to be recognized in the third quarter that exceeds $2 million. That is a primary driver as well for us as we look at the third quarter. And we expect generally for the fourth quarter to return to normal levels of performance relative to seasonality and commentary that we've made historically.

Aaron Grey
Aaron Grey
Analyst at Alliance Global Partners

Okay, great. Appreciate that color. Second question for me, just regarding proprietary brands. You guys already hit your mark for the full year, within the quarter, essentially being at 40%. Just given growth accelerated in the quarter, maybe talk about some of the dynamics that drove that growth, maybe deeper penetration within your commercial business and with some of the MSOs that I know you've been targeting. Thank you.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

Yeah, I think we've been pretty transparent, Aaron, that our commercial business, our MSO business, is certainly expanding. We still do believe that we're in the early stages of growth in a bunch of our proprietary brands that are out on the market right now, and we still believe that there's tremendous opportunities on the distribution side of it. I'd say right now about 90% of the sales going through our proprietary brands right now are GrowGen-centric through our commercial division. So we have high hopes that as the years go on, that many other groups adopt our brands within the industry. So we believe that is just starting, and we are getting way more involved in the distribution of our brands on a go-forward basis. And our brands are working.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

We have hired a bunch of technical advisors that are in the facilities on a daily basis, and the brands are really turning out some of the best cannabis in the country right now, both on the cost side and the quality side. So we couldn't be any prouder of the team that we have out in the markets right now, and really the work that we're doing to transform the industry, really to growing better cannabis at just better levels and better price points.

Aaron Grey
Aaron Grey
Analyst at Alliance Global Partners

Great to hear. Thanks for the color. I'll go and jump back in the queue.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

Thank you.

Operator

Your next question comes from Brian with Oppenheimer. Please go ahead.

Brian Nagel
Brian Nagel
Analyst at Oppenheimer

It's Brian Nagel. Nice quarter. Congratulations.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

Thank you, Brian.

Brian Nagel
Brian Nagel
Analyst at Oppenheimer

It's going to be a follow-up, I think it's going to be a follow-up to the prior question. But here you've had, I guess now three consecutive quarters of positive year-on-year revenue growth. If you look at the guidance for Q3, again, if I got the numbers right, you're guiding revenue growth year-on-year to be down. Is there a breaking trend? Is there a reason for that conservatism?

Greg Sanders
Greg Sanders
CFO at GrowGeneration

Hey, Brian. Thanks for the question. When you look at Q3 of 2025, what we executed was a significant volume of durable sales in that period that created some level of lumpiness in the period last year. In fact, Q3 was a fairly significant outlier for us on a quarterly basis when you look at 2025 in its entirety. I think what you're seeing now in 2026 is maybe less lumpiness, where our durables business has generated more consistent results from quarter to quarter. I think when you look at the guidance that we have in totality for 2026 compared to 2025, we are generally guiding for an up year in contrast to last year. I think you're just seeing the revenue more even across the periods and less of that one-time exposure that you saw in Q3 of last year.

Greg Sanders
Greg Sanders
CFO at GrowGeneration

Generally, we're content with our expectations for Q3 in 2026. In fact, we still expect Q3 to be our strongest performing quarter from a revenue perspective. So although it's down year-over-year, we still feel very good about where we're at in the year and our forward-looking outlook.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

Yeah, Brian, in addition to that, I think on the margin side of it, you will see higher margins in the third quarter this year than you certainly saw last year, with higher consumable products than durable products. But like anything else, things can change. We may close some additional sales within the third quarter that may bring guidance higher. But right now it's really just too early to tell, and we still do believe that you'll see a much stronger fourth quarter this year than you saw last year.

Brian Nagel
Brian Nagel
Analyst at Oppenheimer

Yeah, that's very helpful context. I appreciate all that. The second question I have, and I guess it's bigger picture, but as we're watching the proprietary brands grow, as you said, from a penetration standpoint, hit your annual target. You're halfway through the year, so you're well ahead. I guess the first one I'm going to ask is as this business is starting to really take hold by channel, are you seeing particular growth in one channel? I think in the prior question you mentioned the MSOs, but again, as the business is growing, are you seeing outside strength in one channel? How should we think about from a channel perspective where you're selling these proprietary brands over time?

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

Yeah, I think the channels are pretty broad right now, and again, mostly on the consumable side of it. We do believe that with a bunch of our consumable products right now, both under the Char Coir and Drip brand names and also [Alco], that there's considerable growth ahead. We believe that we're just at the start of private label penetration in the hydroponic cannabis space. We do believe that the growth from this industry is just starting in lawn and garden and in the ag space, and we think you'll see many years of growth to come. One of the hardest issues is you're starting from such a small base, so when you're seeing double-digit growth off a couple million dollars, it's not making a big enough impact in our numbers. As time goes on, we certainly believe that.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

One of the other sides of it, Brian, when we take a look at GrowGen today and the big picture of GrowGen, when you go back to 2024, we lost over $16 million on an adjusted basis. We lost over $6 million last year, and this year we're looking positive $2 million-$3 million on an adjusted basis. So we've picked up almost $18 million with about over 25 less locations. So at this rate, if we continue this rate for a couple more years, you're going to see quite an impact on the growth side of it and also on the EBITDA side of it, which really excites us. We've done an incredible job, I believe, again, reformulating GrowGen and reorganizing it to really to a business to business company that's driven by product and technical support. It's what the industry needs right now.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

We still believe that, again, better years are here to come.

Brian Nagel
Brian Nagel
Analyst at Oppenheimer

That's very helpful. I appreciate the color, Darren. Thank you.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

Thank you, Brian.

Operator

Your next call comes from Mark with Lake Street. Please go ahead.

Mark Smith
Mark Smith
Analyst at Lake Street

Hi, guys. I wanted to ask first about SG&A. It was more flattish kind of year-over-year. Curious if you got SG&A down kind of where you want it and is this kind of a good run rate or is there more cuts that you think you can make there?

Greg Sanders
Greg Sanders
CFO at GrowGeneration

Yeah. Hey, Mark, thanks for the question. In terms of SG&A in the third quarter, I think what you've seen from our business is we closed four stores in the first quarter, and we've rebalanced some of our cost into more growth initiatives. So we've expanded our sales force on the commercial side. We've put more dollars into marketing. We've added more dollars into trialing our private label products across the cannabis space and getting our products into more hands of our core customer. So really more than anything else, it's a rebalancing when we look at 3Q or, excuse me, second quarter in comparison to prior quarters. In terms of the go forward, we are continuing to look at cost reduction opportunities, primarily on the store side.

Greg Sanders
Greg Sanders
CFO at GrowGeneration

We see SG&A as kind of the core driver of a lot of our growth initiatives on both the commercial side as well as with our proprietary brands. We generally expect SG&A to remain in the low sixes in the back half of the year. So relatively consistent, maybe incrementally down compared to what you saw in the second quarter. It is generally a stable area for us at this point as we continue to focus on returning to growth in the business.

Mark Smith
Mark Smith
Analyst at Lake Street

Perfect. I wanted to ask about capital allocation. Balance sheet continues to be in a really good spot here. You started buying back some stock. Curious, as we think about M&A reinvestment in the business, your return on cash to shareholders, how you look at allocating some of this cash.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

Mark, I think we've been pretty transparent. If the right transaction came, we were certainly buyers within the industry and even outside the industry when it goes into the ag and lawn and garden space. We just haven't found the right transaction for GrowGen right now. As I've also said in the past, we've spent the last three years restructuring GrowGen and spending an enormous amount of time getting our ducks in order. We are out looking right now, but without the right transaction, we're not looking to buy revenue that we can't integrate into this company and earnings coming with it. Right now, we're quite comfortable with the cash in the bank. We are getting a little more aggressive on the loaning side of it on some of the deals that we're working on CapEx.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

That's a wonderful part of our business right now, and we believe a growing part of our business. We've been quite conservative with lending money on the CapEx side of it. But again, we certainly are out there looking for the right transactions on that side of it, and we will continue to buy back stock. We have a $10 million stock buyback at the end of the second quarter. We've used $1 million of that so far.

Mark Smith
Mark Smith
Analyst at Lake Street

Perfect. Thank you.

Operator

Ladies and gentlemen, that is all the time we have for questions. I will turn the call back over to Darren Lampert. Please go ahead.

Darren Lampert
Darren Lampert
Co-founder and CEO at GrowGeneration

As you can see from this quarter's performance, our strategy has continued to drive improved financial and operating results. We look forward to keeping you updated as we make further progress during the balance of the year. Thank you.

Operator

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.

Executives
    • Darren Lampert
      Darren Lampert
      Co-founder and CEO
    • Greg Sanders
      Greg Sanders
      CFO
Analysts
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