10-K · February 25, 2026
Honest Company (HNST) is executing a strategic reset (Transformation 2.0: Powering Honest Growth) focused on exiting lower-margin channels (including Honest.com fulfillment, apparel and Canadian retail), rightsizing…
Earnings analysis · 10-Q
HNST earnings analysis
Filed May 6, 2026 · Our reading of the company's report
The latest report
The Honest Company reported Q1 2026 results with revenue of $78.1 million, down 19.7% year-over-year, and gross margins improved to 42.6%. Operating margin was negative at -0.8%, reflecting operational challenges as the…
Read full summary
The Honest Company reported Q1 2026 results with revenue of $78.1 million, down 19.7% year-over-year, and gross margins improved to 42.6%. Operating margin was negative at -0.8%, reflecting operational challenges as the company restructures under its 'Powering Honest Growth' initiative to exit lower-margin categories and streamline expenses.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $-0.01
What stood out
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Revenue Decrease Reflects Strategic Exits
Q1 2026 revenue was $78.1M, down 19.7% from $97.3M in Q1 2025.
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Improved Gross Margin
Gross margin improved by 390 basis points to 42.6% compared to 38.7% in Q1 2025.
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Cash Position Strengthened
As of March 31, 2026, cash and cash equivalents totaled $90.4 million.
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Successful Cost Reduction
Total operating expenses decreased 3.5% to $33.9M from $35.2M in Q1 2025.
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Increase in Marketing Spending
Marketing expenses rose by 14.0% to $14.0M, aimed at supporting higher-margin products.
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Vehicle for Growth - Share Repurchase
The company repurchased 1.05 million shares for approximately $3.0 million.
What to watch
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Restructuring Costs from Transformation
Restructuring expenses for Q1 2026 totaled $606,000 as part of the $30-$35 million projected for the 'Powering Honest Growth' initiative.
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Continued Revenue Decline
Revenue is expected to decrease high-teens percentage in FY 2026 due to exits from certain categories.
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Impact from International Trade Issues
Ongoing geopolitical conflicts and tariffs may further impact supply chain and costs.
Management's outlook
Guidance deferred to earnings press release / call.
Earlier filings 4
10-Q · November 5, 2025
The Honest Company reported Q3 revenue of $92,571,000, down from $99,237,000 in Q3 2024, while generating net income of $758,000 (diluted EPS $0.01). Gross profit declined to $34,489,000 but operating income improved…
10-Q · August 6, 2025
Honest Company reported a modestly positive quarter: revenue of $93,459 (thousands) was essentially flat year-over-year and gross margin expanded to 40.4% driving operating income of $2,888 (thousands) and net income of…
10-Q · May 7, 2025
Honest Company reported Q1 revenue of $97.25M, up $11.03M (12.8%) versus Q1 2024, and delivered GAAP net income of $3.254M (diluted EPS $0.03) vs a loss of $1.403M in the prior year. Gross margin expanded to 38.7% and…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.