Executive Summary

Q1 FY2026 (quarter ended September 30, 2025) was seasonally weak with net revenue of $5.153M and gross margin of -1.2%, driven by accelerated spring growing, fewer stems available to cover fixed costs, and tariffs on bulbs; EBITDA loss widened to $2.390M and diluted EPS was -$1.61 .
Versus prior quarter (Q4 FY2025), revenue fell sharply from $23.179M and gross margin from 23.3% as peak-season Mother’s Day and Easter demand had already occurred; EPS declined from $0.58 to -$1.61 .
Management expects revenue and gross margin to improve in the remaining quarters of FY2026 as more bulbs in inventory are grown into stems and pricing actions partially offset higher bulb costs and tariffs .
No Wall Street (S&P Global) consensus data was available for EPS or revenue; investors should focus on operational trajectory and tariff/pricing dynamics rather than an estimates beat/miss framework (consensus data retrieved from S&P Global; unavailable).*

What Went Well and What Went Wrong

What Went Well

Seasonal operations positioned for peak spring demand: “This quarter is an important quarter in terms of buying our bulbs and preparing our growing programs for the upcoming busy season. We believe that we have set ourselves up to capture the full potential of the peak season ahead.” — Co-CEO Dan Philp .
Increased working capital to support upcoming high season: Working capital rose to $11.264M from $1.098M quarter-over-quarter, reflecting bulb purchases for spring .
Liquidity positioning: Cash increased to $1.840M from $0.906M QoQ, primarily from debt proceeds used to fund bulb purchases .

What Went Wrong

Revenue and margin compression: Net revenue declined to $5.153M and gross margin turned negative (-1.2%) due to fewer stems available to cover fixed costs and the impact of tariffs/higher bulb costs .
Profitability deterioration: Operating loss widened to $3.043M (vs. $1.351M LY), net loss from continuing operations to $3.365M (vs. $1.458M LY), and EBITDA loss to $2.390M (vs. $0.574M LY), driven by lower sales, higher bulb costs, and FX losses .
Cash usage increased: Cash used in operations was $9.9M (vs. $7.6M LY), reflecting working capital build and seasonality, increasing reliance on debt financing .

Financial Results

Consolidated P&L and Key Metrics (oldest → newest)

Metric	Q3 FY2025 (Mar 31, 2025)	Q4 FY2025 (Jun 30, 2025)	Q1 FY2026 (Sep 30, 2025)
Revenue ($USD)	$12.443M	$23.179M	$5.153M
Gross Margin %	31.3%	23.3%	-1.2%
Operating Income (Loss) ($USD)	$1.432M	$2.485M	-$3.043M
Net Income (Loss) from Continuing Ops ($USD)	$0.617M	$1.319M	-$3.365M
Diluted EPS – Continuing Ops ($)	$0.25	$0.58	-$1.61
EBITDA ($USD)	$2.578M	$2.633M	-$2.390M

Segment/Entity-Level EBITDA (where disclosed)

Metric	Q3 FY2025 (Mar 31, 2025)	Q4 FY2025 (Jun 30, 2025)	Q1 FY2026 (Sep 30, 2025)
Bloomia EBITDA ($USD)	$2.918M	N/A (not disclosed quarterly)	-$1.809M
Lendway Overhead EBITDA ($USD)	-$0.340M	N/A (not disclosed quarterly)	-$0.581M
Total Company EBITDA ($USD)	$2.578M	$2.633M	-$2.390M

Balance Sheet and Operating KPIs

Metric	Q3 FY2025 (Mar 31, 2025)	Q4 FY2025 (Jun 30, 2025)	Q1 FY2026 (Sep 30, 2025)
Cash & Equivalents ($USD)	$1.308M	$0.906M	$1.840M
Working Capital ($USD)	$6.274M	$1.098M	$11.264M
Total Debt ($USD)	$40.562M	$34.083M	$45.476M
Cash from Operations ($USD)	$1.7M	$6.3M	-$9.9M

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY2026 remaining quarters	No formal guidance	Management expects revenue to increase as more bulbs in inventory are grown into stems; subject to normal growing risks	Qualitative outlook improved
Gross Margin %	FY2026 remaining quarters	No formal guidance	Management expects gross margin to improve, supported by more stems and price increases to offset higher costs/tariffs	Qualitative outlook improved
Pricing	FY2026	Not previously formalized	Company has raised prices to partially offset tariffs and higher bulb costs	Action implemented
Liquidity	Next 12 months	Belief in adequate liquidity (prior disclosure)	Management reiterates belief cash, operations, and credit availability provide adequate liquidity for at least 12 months	Maintained qualitative view

No numeric ranges for revenue, margins, OpEx, tax rate, or segment-specific guidance were provided in Q1 FY2026 materials .

Earnings Call Themes & Trends

No earnings call transcript was available for Q1 FY2026; themes are drawn from press releases.

Topic	Previous Mentions (Q3 FY2025, Q4 FY2025)	Current Period (Q1 FY2026)	Trend
Seasonality/Peak Spring	Strong spring season; Easter/Mother’s Day timing boosted Q4 FY2025 results and Q3 FY2025 setup	Quarter focused on bulb purchasing and prep for busy season	Seasonal lull now, ramping into spring
Pricing Actions	Not emphasized	Prices raised to partially offset tariffs/higher bulb costs	Proactive pricing to defend margins
Tariffs/Cost Inflation	Higher bulb costs mentioned in Q4 FY2025	Bulbs now subject to tariffs; profitability reduced	Cost pressure intensifying
FX Impact	FX loss in Q4 FY2025 ($0.701M)	Increased FX losses contributed to net loss	FX headwind persists
Working Capital Strategy	Trough at June 30 due to seasonality; rebuild ahead of spring	Sharp WC increase for spring bulb inventory	Seasonal build underway
Customer Demand	Record Mother’s Day; expanded customer base	Confidence in momentum and peak season potential	Positive demand narrative continues

Management Commentary

“This quarter reflects the natural seasonality of our business, but we’re encouraged by the momentum we’re building. The Company is laying the groundwork for a successful year ahead, and we feel as confident as ever in our future.” — Chairman & Co-CEO Mark Jundt .
“This quarter is an important quarter in terms of buying our bulbs and preparing our growing programs for the upcoming busy season. We believe that we have set ourselves up to capture the full potential of the peak season ahead.” — Co-CEO Dan Philp .
Prior momentum context: “record-breaking Mother’s Day sales… We’re excited to keep growing with our customers and to keep this incredible momentum going.” — Chairman & Co-CEO Mark Jundt (Q4 FY2025) .
“We set a goal to grow market share this year and we exceeded our goal… record breaking revenue and a more diverse customer base.” — Co-CEO Dan Philp (Q4 FY2025) .

Q&A Highlights

No Q1 FY2026 earnings call transcript was available; therefore, there are no Q&A themes or clarifications to report for this period [List: earnings-call-transcript none].

Estimates Context

S&P Global consensus data for EPS and revenue in Q1 FY2026 was unavailable due to limited coverage; no beat/miss determination can be made (consensus data retrieved from S&P Global; unavailable).*
Actuals: Revenue $5.153M ; Diluted EPS (continuing ops) -$1.61 .
Implication: With no formal Street anchor, investor focus should be on sequential recovery into peak season, margin defense via pricing, and tariff/cost mitigation .

Key Takeaways for Investors

Seasonal low captured; watch for sequential rebound: Revenue and margins should improve into spring as inventory converts to stems, with pricing partially offsetting tariffs/higher bulb costs .
Cost/tariff pressures are central to the margin story: Bulbs are subject to tariffs and average prices increased; pricing actions are underway but may not fully offset cost inflation near-term .
Working capital and leverage ramp for season: WC jumped to $11.264M and debt to $45.476M to fund bulb purchases; monitor covenant compliance and cash generation in upcoming peak quarters .
FX remains a non-operational drag: FX losses contributed to the widened net loss; consider hedging or currency exposure management where feasible .
Bloomia EBITDA swing underscores seasonality: From $2.918M in Q3 FY2025 to -$1.809M in Q1 FY2026; expect recovery as volumes and efficiencies rise during spring .
Trading setup: Near-term catalysts include holiday/spring sell-through, gross margin trajectory, and evidence that pricing actions offset tariffs; absent Street estimates, price reactions likely hinge on operational KPIs and margin commentary .
Medium-term thesis: Market share gains (prior period) plus operational improvements into peak season could support margin normalization; execution on cost control and FX/tariff management is critical to re-rating .

Footnote: *Consensus/estimates data retrieved from S&P Global; unavailable due to limited coverage.

LENDWAY, INC. (LDWY)·Q1 2026 Earnings Summary