10-Q · July 15, 2026
Winmark Corporation reported Q2 2026 earnings with revenue of $21.97 million and diluted EPS of $2.81, slightly above analyst estimates of $21.77 million and $2.69 respectively. Year-to-date, revenue reached $42.82…
Earnings analysis · 10-Q
WINA earnings analysis
Filed October 14, 2026 · Our reading of the company's report
The latest report
Winmark delivered strong Q3 top-line growth, with revenue up 23.2% to $27.89 million and diluted EPS up 6.3% to $3.21, supported by higher royalties, a $3.83 million advertising fund and software fees. However, the…
Read full summary
Winmark delivered strong Q3 top-line growth, with revenue up 23.2% to $27.89 million and diluted EPS up 6.3% to $3.21, supported by higher royalties, a $3.83 million advertising fund and software fees. However, the advertising fund is reported gross, reducing operating margin to 56.6%, and nine-month net income and EPS declined year over year. Cash generation remained strong at $35.55 million from operations, but the company carries approximately $60.0 million of debt and added a risk concerning franchisee reactions to new fees and advertising funds. No formal numeric guidance was provided, although management believes liquidity is adequate through 2027.
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
- $3.21
- Operating margin
- 56.6%
- Segment
- Franchising: $27.89 million revenue and $15.79 million operating income in Q3 2026, versus $22.59 million and $14.88 million, respectively, in Q3 2025.
- Segment
- Former other operating segment: $0 revenue and $0 operating income in Q3 2026, versus $46,600 revenue and $42,900 operating income in Q3 2025.
What stood out
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Revenue boosted by royalties and ad fund
Q3 revenue increased 23.2% year over year to $27.89 million from $22.63 million, driven by $21.71 million of royalties, $3.83 million of North American advertising fund revenue and $497,100 of software revenue.
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Quarterly EPS and net income increased
Diluted EPS rose 6.3% year over year to $3.21 from $3.02, while quarterly net income increased to $11.82 million from $11.14 million.
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Franchising operating income grew
Franchising operating income increased to $15.79 million from $14.88 million, despite SG&A rising 4.1% to $7.33 million from $7.05 million.
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Royalty growth remained positive
Royalties increased 3.8% to $21.71 million in Q3 and 6.5% to $61.09 million for the first nine months, primarily due to higher franchise retail sales and additional stores.
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Renewal rate and store count were strong
The company renewed 77 of 77 franchise agreements available for renewal during the first nine months of 2026, while total franchised stores increased from 1,378 to 1,398.
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Strong cash generation funded investment
Operating activities generated $35.55 million of cash in the first nine months, while investing activities used $2.55 million, including $2.27 million for point-of-sale software modernization.
What to watch
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Advertising fund diluted reported margin
Operating margin declined to 56.6% from 65.9% year over year, principally reflecting the $3.83 million North American advertising fund expense recorded against the $3.83 million of related revenue.
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Year-to-date earnings declined
Nine-month net income fell to $31.47 million from $31.69 million and diluted EPS declined to $8.51 from $8.61, despite revenue increasing to $70.71 million from $64.97 million.
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Material debt and negative equity
The company had $30.0 million of line-of-credit term borrowings and $30.0 million of notes payable, or approximately $60.0 million of debt, while shareholders' equity remained negative at $(37.40) million.
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Liquidity and working capital require monitoring
Cash and restricted cash were $28.11 million at September 26, 2026, versus $39.87 million at September 27, 2025, while inventory increased to $789,200 from $362,500 and receivables increased to $2.25 million from $1.48 million.
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New franchisee fee adoption risk
The filing added a risk that the monthly Software Fee and North American Advertising Funds could adversely affect franchisee relationships and system performance; the software fee is $295 per store per month and the Plato's Closet fund collects 2% of sales.
Management's outlook
No formal numeric revenue or EPS guidance was provided. Management said cash on hand, operating cash flow and the Line of Credit are expected to fund planned operations through 2027; the Line of Credit had $20.0 million of revolving capacity available as of September 26, 2026.
Earlier filings 4
10-Q · April 15, 2026
Winmark reported Q1 revenues of $20,849,700 (down from $21,919,700 a year ago) and diluted EPS of $2.50 (down from $2.71). Royalties were a bright spot, rising 8.4% to $19,262,800, while operating margin compressed to…
10-K · February 25, 2026
Winmark describes a franchise-led growth strategy centered on five resale brands and a multi-channel push (e-commerce for select brands). System‑wide sales rose to $1,682.0 million in 2025 and the company ended the year…
10-Q · October 15, 2025
Winmark reported Q3 revenue of $22,632,900 and diluted EPS of $3.02 for the three months ended September 27, 2025. Revenue and operating income were modestly higher year-over-year with very strong margins, cash balances…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.