LEAT earnings analysis
What we found in LEAT's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Leatt delivered strong first-half growth, with revenue up 14% to $35.90 million, operating income up 23% to $3.47 million and net income up 19% to $2.68 million. Second-quarter performance was mixed: revenue increased just 1%, gross margin improved to approximately 45.4%, but operating income declined 18% and net income fell 20% as operating expenses rose 16%. Cash generation was a major positive, with $7.44 million of operating cash flow and $19.53 million of cash, cash equivalents and restricted cash at June 30, 2026. The filing reports no material changes to the risk factors from the December 31, 2025 Form 10-K and provides no quantitative guidance.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Strong Six-Month Growth, Softer Q2 Profit
- Six-month revenue increased 14% to $35,898,430 from $31,544,203, while six-month net income rose 19% to $2,679,683 from $2,259,858. However, second-quarter revenue grew only 1% to $16,390,944 and net income declined 20% to $908,989.
- Gross Margin Expanded 280 Basis Points
- Gross profit increased 8% in Q2 to $7,435,242 from $6,889,193, lifting gross margin to approximately 45.4% from 42.6%. Management attributed the improvement to better domestic and international margins and improved shipping and logistics efficiency.
- Helmets and Body Armor Led Product Growth
- Helmet revenue rose 14% to $3,557,586 in Q2, while body armor revenue increased 6% to $8,749,179. For the six months, helmet revenue grew 37% to $8,948,113 and body armor revenue increased 14% to $17,339,848.
- Operating Cash Flow and FCF Strengthened
- Operating cash flow increased 81% to $7,438,967 for the six months from $4,114,440 in the prior-year period. Using disclosed capital expenditures of $490,405, implied free cash flow was approximately $6,948,562.
- Liquidity Position Remains Strong
- Cash, cash equivalents and restricted cash rose 48% to $19,527,927 from $13,233,047 at December 31, 2025. Management said these balances and internally generated operating cash should cover anticipated operating requirements for at least the next twelve months.
- Direct Channels Offset Distributor Delays
- Consumer-direct sales increased 68%, or $960,000, in Q2. Although distributor sales declined 6%, or $650,000, because shipments were delayed by supply-chain constraints, management said shipping had resumed and global orders continued to be fulfilled.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Supply Chain and China Tariff Exposure
- Management reported that shipments of primarily MOTO apparel, boots and helmets were delayed by global supply-chain constraints, reducing Q2 global distributor sales by 6%, or $650,000. The company manufactures predominantly in China and is exposed to possible tariffs, customs duties and other trade restrictions.
- Expense Growth Pressured Q2 Operating Profit
- Operating expenses increased 16% in Q2 to $6,417,826 from $5,537,581, including a 24% increase in advertising and marketing expense to $1,428,833 and an 18% increase in salaries and wages to $2,176,254. The resulting operating income fell 18% to $1,152,531 despite the 1% revenue increase.
- Inventory and Customer Credit Risk
- Inventory declined by $6,886,587 and accounts receivable declined by $811,561 during the first six months, supporting cash generation, but the company maintained an inventory-obsolescence reserve of $597,835 and an accounts-receivable credit-loss allowance of $249,782 at June 30, 2026.
What they reported.
What the company itself reported, taken out of the document.
- Gross margin
- 45.4%
- Operating margin
- 7.0%
- Segment
- Body armor: $8,749,179, up 6% year over year and 53% of revenue
- Segment
- Helmets: $3,557,586, up 14% year over year and 22% of revenue
- Segment
- Other products, parts and accessories: $3,542,369, down 13% year over year and 22% of revenue
- Segment
- Neck braces: $541,810, down 23% year over year and 3% of revenue
What they said about what is next.
No quantitative revenue or EPS guidance was provided. Management states that it expects growth in the motor sports and bicycle markets, increasing demand for protective equipment, increased revenue growth and profitability from higher production volumes, and plans to launch and ship the GRITT bike-care product range in the second half of 2026.
The filing reads about the same as the one before it.
What came before.
- 10-Q · May 12, 2026
- Leatt Corporation reported a strong Q1 2026, with revenues of $19.51 million, a 27% increase over Q1 2025. The net income also improved, reaching $1.77 million, up 58% YoY, supported by growth in helmet and body armor…
- 10-Q · August 7, 2025
- Leatt reported a strong Q2 with revenues of $16,176,339 (up from $10,078,695 in Q2 2024), a swing to operating income of $1,399,918 (from an operating loss of $1,130,386), and GAAP basic EPS of $0.18 (vs. $(0.17) in Q2…
- 10-K · March 28, 2025
- Leatt's 10-K emphasizes its core proprietary Leatt‑Brace® technology (licensed from Xceed Holdings, controlled by the founder) and a broad product roadmap spanning neck braces, helmets, body armor, boots and shoes with…
- 10-Q · August 9, 2024
- Leatt reported a weaker quarter with revenue of $10,078,695 (down $2,271,529 or -18.4% vs Q2 2023) and a gross profit of $3,921,413 (gross margin ~38.9%, down ~4.4 ppt). Operating results swung to an operating loss of…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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