Traeger Q1 Earnings Call Highlights

Key Points

• Revenue fell sharply in Q1, with sales down 34% year over year to $94 million, but executives said sell-through trends were better than expected and underlying consumer demand looked healthier than the headline revenue decline suggested.
• Project Gravity continued to drive meaningful savings, including $15 million in year-over-year operating expense reductions, a 31% inventory decline, and $14.5 million in free cash flow for the quarter.
• Traeger raised full-year adjusted EBITDA guidance to $57 million-$67 million after booking a tariff refund benefit, while launching lower-priced products like Westwood and Irontop to capture more price-sensitive consumers.

Traeger NYSE: COOK executives said the outdoor cooking company entered its peak selling season with stronger-than-expected sell-through trends, new lower-priced product launches and continued benefits from its multi-year cost reduction program, even as first-quarter revenue fell sharply from a year earlier.

On the company’s first-quarter 2026 earnings call, Chief Executive Officer Jeremy Andrus said the quarter reflected “planned timing, channel decisions, and marketplace dynamics” discussed previously, but emphasized that underlying consumer demand was more encouraging than the reported revenue decline suggested.

“Sell-through is the clearest signal of where the business is headed and of a healthy retail environment,” Andrus said. He said year-to-date sell-through was tracking slightly above Traeger’s expectations and, excluding strategic channel exits from its direct-to-consumer and Costco Roadshow businesses, was slightly up year over year.

Revenue Declines, But Cost Cuts Support Profitability

Chief Financial Officer Joey Hord said first-quarter revenue declined 34% to $94 million. Grill revenue fell 45% to $47 million, driven by difficult comparisons to prior-year product launches, pull-forward ordering ahead of tariffs last year, channel optimization under Project Gravity and a mix shift toward lower-priced grills.

Consumables revenue decreased 14% to $26 million, which Hord attributed primarily to wood pellet channel mix shifts and timing of trade spending, partly offset by higher units. Accessories revenue declined 22% to $21 million, primarily due to lower MEATER sales.

Gross profit fell to $43 million from $59 million a year earlier. Gross margin was 45.7%, up 420 basis points year over year, including a $12.4 million benefit from an IEPA tariff refund. Excluding that item, gross margin was 32.6%, down 890 basis points, reflecting trade spending timing, a lower mix of direct import sales, tariff-related costs and MEATER deleverage.

Traeger reported first-quarter net income of $3 million, compared with a net loss of $1 million in the prior-year period. Hord said net income per diluted share was $1.08, versus a loss of $0.30 a year earlier. Adjusted net income was $4 million, or $1.49 per diluted share, compared with adjusted net income of $7 million, or $2.54 per diluted share, in the first quarter of 2025.

Adjusted EBITDA was $17 million, down from $23 million in the year-ago period, and included the $12.4 million tariff refund benefit. Hord said adjusted EBITDA would have been near the midpoint of the company’s first-quarter guidance range excluding the refund.

Project Gravity Delivers Expense and Inventory Reductions

Executives repeatedly pointed to Project Gravity, Traeger’s multi-year effort to simplify the business and improve margins, as a key driver of financial progress. Hord said the company delivered $15 million of year-over-year operating expense reduction, reduced inventory by 31% versus the prior year and generated $14.5 million of free cash flow in the quarter.

Andrus said Traeger has executed most of its Phase I and Phase II actions under the program, including organizational changes, MEATER centralization, exiting the Costco Roadshow and winding down DTC commerce. He said additional Phase II opportunities include SKU rationalization and pricing work intended to support a simpler product architecture and higher structural margins in 2027 and 2028.

Traeger expects Project Gravity to deliver approximately $64 million to $70 million of total run-rate value across both phases. Full-year guidance includes about $50 million of Project Gravity value capture, including roughly $30 million of incremental benefit in 2026, according to Hord.

Inventory ended the quarter at $88 million, down from $99 million at the end of the fourth quarter of 2025 and $127 million a year earlier. Hord said the reduction reflected in-transit timing, lower MEATER inventory and strategic reductions tied to Project Gravity. He said the company was “really happy” with Traeger-side inventory levels but noted MEATER remained a “soft spot,” with pricing and inventory actions under review.

Tariff Refund Lifts Guidance

Traeger raised its full-year adjusted EBITDA guidance to a range of $57 million to $67 million, from the prior outlook, while reiterating revenue guidance of $465 million to $485 million. The increase reflects the flow-through of the IEPA tariff refund benefit recognized in the first quarter.

Hord said Traeger recorded a $15.6 million receivable related to the refund, consisting of a $12.4 million benefit to gross profit and adjusted EBITDA and a $3.2 million reduction in inventory carrying cost. In response to a question from Baird analyst Peter Benedict, Hord said the company expects the cash to be paid within 60 to 90 days, though he said management is being prudent in its planning.

The company also increased its gross margin outlook to 39.5% to 40.5%, incorporating the tariff refund benefit and offsetting assumptions for MEATER competitive pressure, macroeconomic headwinds, rising transportation costs tied to oil prices and broader tariff uncertainty. Free cash flow guidance remains unchanged at more than $30 million and does not yet reflect the tariff refund because the receivable has not converted to cash.

Hord said the company had $34 million in cash and cash equivalents at quarter-end, $403 million in total debt and no borrowings on its credit facilities. Net debt was $370 million, and total liquidity was $184 million. He said Traeger is currently undrawn on its $112.5 million revolver and does not expect to use it this year based on current expectations.

New Products Target Lower Entry Price Points

Andrus highlighted the April launch of Westwood, a new grill lineup designed to bring Traeger’s connected capabilities and performance to a more accessible price point. He said the launch generated more than 60% more impressions across earned and organic channels compared with the company’s Woodridge launch in 2025, and early consumer ratings ranged from 4.8 to five stars across traeger.com, The Home Depot and Ace Hardware.

Later in May, Traeger expects to begin landing Irontop, a new griddle lineup, in retail. Andrus said Irontop expands the company into a more accessible griddle price tier where it has not historically competed and addresses consumer feedback around build quality, even heat and reliable results.

During the question-and-answer session, William Blair analyst Philip Blee asked about demand by price tier. Andrus said the environment remains price-sensitive and noted that Westwood is being introduced at a $599 price point, the lowest at which Traeger has offered a connected grill product. Irontop includes a $499 griddle SKU. At the same time, Andrus said Traeger continues to over-index relative to the category on average selling price, citing “really nice sell-through dynamics” for the Woodridge Pro at $1,149.

Retail Execution and Brand Engagement Remain Priorities

Andrus said Traeger’s brand engagement remains strong despite cautious consumer spending. First-quarter social engagement rose more than 30% year over year, and 65% of organic impressions came from non-followers. Brand ambassadors, including Matt Pittman and Bennie Kendrick, generated 170 million impressions across more than 3,000 posts during the quarter.

At The Home Depot, Andrus said Traeger is expanding its retail sales specialist program, which trains store associates and supports in-store cooking demonstrations. The company is targeting at least 7,500 cooking events in the second quarter, nearly twice the number held in the same quarter of 2024.

At Ace Hardware, Traeger is investing in about 1,000 elevated doors with enhanced store positioning, window signage and floor stands. Andrus said pre-book orders at Ace’s Spring 2026 show were up nearly 50% from last year.

While executives said outdoor cooking appears slightly down overall, Andrus said Traeger believes its share is slightly up when excluding exited channels. “I think our brand and our team is executing well in a challenging environment,” he said, adding that management is “cautiously optimistic” as the company moves through the important second quarter.

About Traeger NYSE: COOK

Traeger, trading on the NYSE under the ticker COOK, is a designer, manufacturer and marketer of wood pellet grills and outdoor cooking appliances. The company's core product lineup features a range of hardwood-pellet grills that combine wood-fired flavor with digital temperature control. Beyond grills, Traeger offers a suite of accessories—such as grill covers, smoking woods, meat probes and recipe rubs—as well as outdoor kitchen solutions designed to serve both consumer and light-commercial segments.

Founded in 1985 by Joe Traeger, the brand pioneered the wood-pellet grilling category.

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