BRC (NYSE:BRCC), the parent of Black Rifle Coffee Company, reported second-quarter 2026 revenue growth of 13% as expansion in packaged coffee distribution, direct-to-consumer sales growth and tighter cost management supported higher profitability and free cash flow.
Chief Executive Officer Chris Mondzelewski said the company’s first-half performance reflected a more disciplined allocation of resources toward customers, channels and products with the strongest potential returns. He said packaged coffee remained the company’s principal growth engine, supported by retail distribution gains and direct-to-consumer momentum.
Packaged Coffee Gains Share and Distribution
Mondzelewski said Black Rifle packaged coffee sales rose 28.2% during the latest quarter, according to Nielsen data, compared with 9.9% growth for the broader category. Over the latest 52-week period, the company’s retail sales increased 32.5%, including 16.6% unit growth.
Bagged coffee velocity reached category-level performance in 2025 and remained at that level year to date despite continued expansion in distribution and the company’s price premium, he said. Bagged-coffee market share increased 60 basis points from a year earlier to 3.3%, while pod share rose 30 basis points to 2.2% across the total market.
Packaged coffee distribution increased by more than 2.5 percentage points of all-commodity volume, or ACV, year over year to 56.5% in the second quarter. The company also increased its presence at existing grocery accounts, where the average retailer carried approximately 1.3 more Black Rifle Coffee items than a year earlier.
Mondzelewski described the strategy as “land and expand,” with initial placements typically beginning with two to four items before assortments grow over time. He said the company remains underpenetrated in grocery and online marketplaces relative to its position with its largest mass retailer.
Online Marketplace Sales Rise 90%
Direct-to-consumer growth was supported by a 90% increase in third-party marketplace sales. In May, the company moved blackriflecoffee.com to a new e-commerce platform, which management said has improved product visibility in online shopping results, strengthened organic search rankings and stabilized the subscription base in the nearly three months following the conversion.
Mondzelewski said the company views marketplaces as an incremental customer-acquisition channel rather than a replacement for its own website, which remains its core platform for subscriptions, repeat purchases and exclusive offerings. Amigh said the company uses third-party marketplace fulfillment, which carries a higher cost but enables delivery to consumers in less than two days.
Management also highlighted different consumer purchasing patterns by channel. The largest online marketplace and the largest mass retailer each generate roughly $4 billion in annual packaged-coffee sales, with both skewing toward pods. Grocery, with approximately $6.8 billion in annual sales, has a more balanced mix of bags and pods. The company said it is tailoring assortments and pack sizes to channel-specific buying patterns.
Margins Improve Despite Coffee-Cost Pressure
Second-quarter gross margin expanded approximately 15 basis points year over year to 34.1%, the first year-over-year improvement in more than four quarters. Amigh said higher coffee costs flowing through inventory reduced margin by more than 100 basis points net of pricing, but that pressure was offset by a cleaner inventory position, productivity initiatives and favorable mix.
The company has secured all of its expected green coffee requirements for 2026 at $2.95 per pound and has purchased more than 50% of anticipated 2027 needs at $2.65 per pound. For comparison, Amigh said its average 2025 coffee cost was $2.85 per pound. He expects lower contracted costs to flow through cost of sales more meaningfully in the second half of 2026.
Operating expenses declined 21% to $35.4 million, primarily due to the absence of a prior-year legal accrual and lower legal, professional and other general and administrative expenses. Marketing expense increased 8% but fell about 50 basis points as a percentage of revenue to 9.8%.
Adjusted EBITDA increased more than 160% to $6.3 million, from $2.4 million a year earlier, while adjusted EBITDA margin expanded about 335 basis points to 5.9%. Free cash flow totaled $5.4 million in the quarter and $11.5 million year to date, compared with a $9.6 million use of free cash flow in the prior-year period.
Company Maintains Full-Year Outlook
BRC maintained its 2026 outlook for at least 8% revenue growth, or approximately $430 million, and at least 35% adjusted EBITDA growth, or approximately $29 million. It also maintained its expectation for full-year gross margin of 34% to 36%, compared with 34.6% in 2025.
For the third quarter, the company expects revenue growth of at least 5% year over year, or roughly $106 million, and adjusted EBITDA of approximately $7 million. Management said second-half comparisons will be affected by the fading benefit from prior pricing actions, approximately $5 million of non-recurring liquidation revenue in the fourth quarter of 2025, and moderation in convenience-channel demand tied to higher fuel prices and softness in ready-to-drink coffee.
In ready-to-drink coffee, management said conditions remain challenging, particularly in convenience stores, though grocery performance has been comparatively stronger. Black Rifle Energy ended the quarter with about 21% ACV across more than 22,000 doors. Mondzelewski said the company’s near-term priority is improving productivity in existing energy doors and expanding selectively, while directing most investment toward its hot-coffee business.
About BRC (NYSE:BRCC)
Black Rifle Coffee Company, Inc is a veteran-owned specialty coffee roaster and retailer that offers a range of coffee products, merchandise and subscription services. The company sources, roasts and distributes its own blends and single-origin coffees, as well as ready-to-drink beverages and branded apparel. Its product lineup includes whole-bean and ground coffees, cold brew concentrates, K-cup pods and limited-edition small-batch offerings designed to appeal to active lifestyle and patriotic consumers.
Founded in 2014 by U.S.
