GrowGeneration (NASDAQ:GRWG) Posts Earnings Results, Misses Expectations By $0.05 EPS

GrowGeneration (NASDAQ:GRWG) issued its quarterly earnings results on Thursday. The company reported ($0.12) earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of ($0.07) by ($0.05), reports. The company had revenue of $37.82 million during the quarter, compared to the consensus estimate of $40.02 million. GrowGeneration had a negative return on equity of 29.82% and a negative net margin of 24.77%.

Here are the key takeaways from GrowGeneration’s conference call:

• Company executed a structural turnaround in 2025 with private‑label penetration rising to 32.8% (35.8% in Q4), gross margin up 370 bps to 26.8%, and adjusted EBITDA improving by $8.5M to -$6M; management guides to roughly break‑even adjusted EBITDA and 27%–29% gross margins for 2026.
• GrowGen cut operating expenses by about $27M (28%) in 2025 and says these are permanent structural savings, underpinning the path to profitability even with modest revenue growth.
• Balance sheet strength supports capital returns and optionality: the company ended 2025 with $46.1M cash, no debt, and a board‑authorized repurchase program for up to 10 million shares (management plans to execute gradually).
• Strategic shift toward a B2B, brand‑led model: expansion of proprietary brands across Viagrow/major retailers, distribution deals (Arid Sales, V1 Solutions), GrowGen Build projects, and MMI Storage Solutions (FY revenue $27.5M) aim to diversify channels and geographies but will take time to scale.
• Top‑line and legacy retail risk remain: FY 2025 revenue fell to $161.7M from $188.9M due to store consolidations, GAAP net loss was $24M and adjusted EBITDA is still negative, and management expects further store exits (targeting ~15 by year‑end), so execution risk persists.

GrowGeneration Stock Up 3.8%

NASDAQ:GRWG traded up $0.04 during trading hours on Thursday, reaching $1.09. 1,257,428 shares of the stock were exchanged, compared to its average volume of 332,471. The stock has a market capitalization of $65.23 million, a P/E ratio of -1.63 and a beta of 2.42. The firm has a 50 day simple moving average of $1.25 and a 200-day simple moving average of $1.50. GrowGeneration has a 52 week low of $0.82 and a 52 week high of $2.40.

Wall Street Analyst Weigh In

Separately, Weiss Ratings reissued a “sell (d-)” rating on shares of GrowGeneration in a report on Thursday, January 22nd. One equities research analyst has rated the stock with a Buy rating and one has assigned a Sell rating to the company’s stock. Based on data from MarketBeat, GrowGeneration currently has a consensus rating of “Hold” and an average price target of $2.50.

Institutional Investors Weigh In On GrowGeneration

Several institutional investors and hedge funds have recently made changes to their positions in the company. Virtu Financial LLC acquired a new position in GrowGeneration in the fourth quarter worth $43,000. Prentice Capital Management LP increased its stake in GrowGeneration by 65.7% during the fourth quarter. Prentice Capital Management LP now owns 274,097 shares of the company’s stock valued at $411,000 after purchasing an additional 108,711 shares during the last quarter. Quadrature Capital Ltd raised its holdings in shares of GrowGeneration by 354.4% during the fourth quarter. Quadrature Capital Ltd now owns 71,034 shares of the company’s stock worth $107,000 after purchasing an additional 55,401 shares during the period. Bridgeway Capital Management LLC raised its holdings in shares of GrowGeneration by 274.6% during the fourth quarter. Bridgeway Capital Management LLC now owns 69,298 shares of the company’s stock worth $104,000 after purchasing an additional 50,801 shares during the period. Finally, Squarepoint Ops LLC lifted its position in shares of GrowGeneration by 18.0% in the 4th quarter. Squarepoint Ops LLC now owns 189,484 shares of the company’s stock worth $284,000 after buying an additional 28,872 shares during the last quarter. 36.02% of the stock is owned by institutional investors and hedge funds.

GrowGeneration Company Profile

GrowGeneration Corp. is the largest chain of specialty hydroponic and organic garden centers in the United States, serving commercial and home growers of all experience levels. The company offers a broad assortment of cultivation supplies, including high-efficiency LED lighting, climate control systems, irrigation and fertigation equipment, growing media and nutrients. Through its retail outlets and e-commerce platform, GrowGeneration caters to indoor and outdoor horticultural operations, with a particular focus on the rapidly expanding legal cannabis market.

In addition to its product offerings, GrowGeneration provides design, consulting and project management services for turnkey cultivation facilities.