10-Q · May 13, 2026
Reed's Q1 2026 results showed a notable decline in both revenue and gross margin. Revenue fell 29% year-over-year to $7.14 million, significantly missing the $7.98 million estimate, while EPS decreased to -$0.55 from…
Earnings analysis · 10-Q
REED earnings analysis
Filed August 12, 2026 · Our reading of the company's report
The latest report
Reed’s Q2 revenue declined to $7.488 million and missed consensus, while gross margin improved sharply to 24% from 8% year over year and EPS of $(0.36) beat estimates. The net loss narrowed to $4.273 million, but the…
Read full summary
Reed’s Q2 revenue declined to $7.488 million and missed consensus, while gross margin improved sharply to 24% from 8% year over year and EPS of $(0.36) beat estimates. The net loss narrowed to $4.273 million, but the company remains financially constrained, with $2.4 million of cash, approximately $9.3 million of secured debt maturing September 30, 2026, and $8.0 million of operating cash usage in the first six months. Management expects gross margin to reach the mid-30% area but provided no numeric revenue or EPS guidance, leaving liquidity and listing risks dominant.
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.
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
- $-0.36
- Gross margin
- 24%
What stood out
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Revenue Declined and Missed Consensus
Revenue was $7.488 million, approximately 25% below the approximately $10 million reported in 2025Q2 and below the $7.6184 million consensus estimate by $0.1304 million, or 1.7%.
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Gross Margin Rebounded
Gross margin improved to 24% from 8% in the prior-year quarter, a 16 percentage-point increase, and from 9.8% in 2026Q1, a 14.2 percentage-point increase.
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EPS Beat Estimates
Diluted EPS was $(0.36), better than the $(0.41) consensus estimate by $0.05, but worse than $(0.13) in 2025Q2 by $0.23.
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Net Loss Narrowed
Net loss narrowed to $4.273 million from $6.048 million in the prior-year quarter, an improvement of $1.775 million, or 29.4%.
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Liquidity Remains Constrained
As of June 30, 2026, cash was $2.4 million and the principal amount outstanding under the Senior Secured Loan was approximately $9.3 million, with no remaining availability.
What to watch
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Going-Concern and Liquidity Risk
The filing states that cash flow and losses raise substantial doubt about going-concern status. For the six months ended June 30, 2026, Reed’s recorded a $10.7 million net loss and used $8.0 million in operating cash; cash was $2.4 million at quarter-end.
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Debt Maturity and Covenant Risk
The Senior Secured Loan had approximately $9.3 million of principal outstanding, no remaining availability, and a September 30, 2026 maturity date. The filing warns that failure to repay or comply with covenants could lead to acceleration and potential foreclosure on assets.
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NYSE American Delisting Risk
The company reported a stockholders’ deficiency of $1.5 million and received a May 29, 2026 NYSE American notice for noncompliance with equity thresholds of $4.0 million and $6.0 million under Sections 1003(a)(ii) and 1003(a)(iii). Reed’s submitted a compliance plan targeting November 29, 2027, but delisting remains possible.
Management's outlook
Management expects gross margin to expand to the mid-30% area and continued optimization of selling, general and administrative expenses. No numeric revenue or EPS guidance was provided.
Earlier filings 4
10-K · March 25, 2026
Reed’s 2025 10-K emphasizes an asset-light, co-packer model and expansion into international and RTD/functional soda categories (established Reed’s (Asia) Limited and launched a multifunctional soda line in 2025).…
10-Q · November 4, 2025
Reed’s reported Q3 2025 net sales of $7.03M (up from $6.75M in Q3 2024) with gross profit of $1.224M, but continued heavy operating losses: loss from operations of $(4.103)M and diluted EPS of $(0.48). Liquidity remains…
10-Q · August 13, 2025
Reed’s reported Q2 2025 net sales of $9,523 (thousands) and a net loss of $6,048 (thousands), or $(0.13) per share, with gross profit collapsing to $807 from $3,831 a year earlier. The quarter showed a major margin…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.