Record Revenue of $58.4 million, Increased 17.8% Year-Over-Year
Glasses Revenue Increased 54.0% Year-Over-Year to $11.1 million
Repeat Revenue Grew 27.4%, or 65.5% of Total Revenue
Adjusted EBITDA Increased Year-Over-Year to $2.9 million, or 5.0% of Revenue
Fifteenth Consecutive Quarter Reporting Positive Adjusted EBITDA
VANCOUVER, BC, Aug. 5, 2026 /CNW/ -- Kits Eyecare Ltd. (TSX: KITS) ("KITS" or the "Company"), a leading vertically integrated eyecare provider, today announced its financial results for the second quarter ended June 30, 2026.
Second Quarter 2026 Financial & Operational Highlights
For the second quarter of 2026, compared to the second quarter of 2025:
-- Revenue increased by 17.8% to a record $58.4 million compared to $49.6
million
-- Glasses revenue grew 54.0% to $11.1 million, representing 18.9% of
revenue, compared to 14.5%; premium lens upgrades represented 45.2% of
glasses revenue
-- Repeat revenue grew 27.4% to a record $38.3 million, or 65.5% of revenue,
compared to 60.6% of revenue
-- Gross profit increased by 23.0% to $22.2 million, or 37.9% of revenue,
compared to $18.0 million, or 36.3% of revenue
-- Adjusted EBITDA margin was 5.0% of revenue, with $2.9 million of Adjusted
EBITDA, compared to 5.2% of revenue, and $2.6 million
-- Net Income increased by $2.2 million to $1.5 million or $0.04 per share
(basic), compared to a net loss of $0.7 million or $(0.02) per share
(basic)
-- Record operating cash flow of $7.8 million, representing 13.3% of
revenue. Closing the quarter with a cash balance of $27.4 million and no
debt
Year-to-Date 2026 Financial & Operational Highlights
For the six months ended June 30, 2026, compared to the six months ended June 30, 2025:
-- Revenue increased 20.5% (22.2% in constant currency) to $115.9 million
compared to $96.2 million
-- Glasses revenue of $21.9 million, increased 57.2% year-over-year
-- Gross profit was $45.7 million or 39.4% of revenue, compared to $35.1
million or 36.5% of revenue
-- Adjusted EBITDA improved by $1.1 million to $7.1 million compared to $6.0
million
-- Net income was $3.4 million compared to net income of $0.9 million
Management Commentary
"We believe the value of our business lies in the strength of the KITS brand and the loyalty it earns -- and this quarter, that loyalty showed up in the numbers," said Roger Hardy, Co-Founder and CEO of KITS. "Repeat revenue grew 27.4% to 65.5% of revenue, average order value reached a record $213, glasses grew 54% at expanding margins, and the business generated a record $7.8 million in operating cash flow for the quarter. Very few companies grow at this rate; even fewer do it while generating cash. We are one of them. The business is now paying for its own acceleration, and we are still early."
"Coming into 2026 we made a deliberate decision to build out our glasses business, and the results -- 54% growth, with the strongest new-customer cohorts in our history validates that focus," added Tai Silvey, President of KITS. "In the back half we intend to rebalance: sustaining the momentum in glasses while ensuring our contact lens acquisition engine remains robust. Customers are choosing KITS for all of their vision needs because of the uniqueness of our vertically integrated model -- quality, value, and speed in a combination we don't believe anyone else in the category can match. Our mission is to make eyecare easy, and more than 1.1 million active customers are telling us it's working."
Second Quarter 2026 Financial Results
Revenue for the three months ended June 30, 2026 reached a record $58.4 million, increasing 17.8%, led by glasses revenue that grew 54.0% and now represents nearly one-fifth of the business. The Company generated a record $7.8 million in cash flow from operations, equal to 13.3% of revenue, and ended the quarter with $27.4 million in cash and no debt.
The recurring foundation of the business reached new highs. Repeat customers contributed 65.5% of revenue, up from 60.6% in the prior-year period, with repeat revenue growing 27.4% year-over-year to $38.3 million. The Company's 2-year Active Customer base grew 15.2% to a record 1,142,000, and the Autoship subscription program is now a $24.6 million annualized annuity with minimal maintenance cost.
Glasses led the Company's growth, with revenue up 54.0% to $11.1 million on approximately 148,300 units delivered, up 32.4%. The quality of the growth matched its magnitude: premium lens upgrades represented 45.2% of glasses revenue, 78,500 units were delivered to repeat customers, up 51.0%, and new glasses customers acquired in the quarter generated first-order revenue 50% higher than the comparable prior-year cohort on identical entry pricing, aided by OpticianAI$(TM)$, the Company's AI-powered fitting engine. Glasses customers acquired in 2026 are generating per-customer first-order revenue that exceeds the multi-year cumulative revenue of cohorts acquired in earlier years.
Gross margin expanded 160 basis points to 37.9%, driven entirely by organic factors: the growing mix of glasses revenue, increased adoption of premium lens upgrades, and disciplined pricing and promotion management. The quarter also marked a step-change in capital discipline: the Company retired the last of its legacy debt obligations, completed the disposition of its Bitcoin exchange-traded fund treasury position, and began returning capital to shareholders, repurchasing and cancelling 89,200 common shares for $1.0 million under its normal course issuer bid (NCIB).
Third Quarter 2026 Outlook
For the third quarter of 2026, KITS management expects revenue to be in the range of $62.0 million to $64.0 million, with Adjusted EBITDA as a percentage of revenue between 4.0% and 6.0%. See "Forward-Looking Statements" below for important disclosure with respect to expectations and forward-looking information.
Conference Call
KITS management will host the conference call followed by a question-and-answer period. To access the call instantly, please click here to register your name and phone number via the rapid connect link.
The conference call will also be webcast live with a presentation and available for replay here and via the investor relations section of the Company's website at ir.kits.com.
Date: Wednesday, August 5, 2026
Time: 9:00 a.m. Eastern time
Presentation webcast link: https://app.webinar.net/oD5AQ4AMgBe
Rapid connect link: https://emportal.ink/45duRjD
North American toll-free number: 1-888-510-2154
Local Toronto dial-in number: 1-437-900-0527
Confirmation #: 83791 #
Financial Highlights
The following selected financial information is qualified in its entirety by and should be read conjunction with our consolidated financial statements for the three and six months ended June 30, 2026 and 2025 and accompanying notes and Management's Discussion and Analysis ("MD&A") which may be viewed on SEDAR+ at www.sedarplus.ca.
Three Months Ended Six Months Ended
Financial and June 30, June 30, June 30, June 30,
Operating Data 2026(unaudited) 2025(unaudited) 2026(unaudited) 2025(unaudited)
Revenue $ 58,427 $ 49,580 $ 115,896 $ 96,175
Net income
(loss) $ 1,456 $ (694) $ 3,431 $ 909
Net income
(loss) per
share
Basic $ 0.04 $ (0.02) $ 0.10 $ 0.03
Diluted $ 0.04 $ (0.02) $ 0.10 $ 0.03
Non-IFRS
Measures (a):
Constant
currency
revenue $ 58,453 $ 49,580 $ 117,555 $ 96,175
EBITDA $ 2,270 $ 243 $ 6,656 $ 3,345
Adjusted
EBITDA $ 2,943 $ 2,575 $ 7,077 $ 6,036
Adjusted
EBITDA
Margin % 5.0 % 5.2 % 6.1 % 6.3 %
Reconciliation
of constant
currency
revenue
Revenue $ 58,427 $ 49,580 $ 115,896 $ 96,175
Foreign
exchange
impact 26 - 1,659 -
Constant
Currency
Revenue $ 58,453 $ 49,580 $ 117,555 $ 96,175
Change in
constant
currency $ 8,873 $ 21,380
Change in
constant
currency % 17.9 % 22.2 %
Reconciliation
of Adjusted
EBITDA
Net income
(loss) for the
period $ 1,456 $ (694) $ 3,431 $ 909
Add back:
Income taxes 630 205 1,607 909
Finance costs
-- net (375) 128 575 299
Depreciation
and
amortization 559 604 1,043 1,228
EBITDA $ 2,270 $ 243 $ 6,656 $ 3,345
Add back
Share-based
compensation
(b) $ 1,427 $ 644 $ 1,878 $ 913
Exchange loss /
(gain) (758) 1,684 (1,464) 1,771
One-time costs
(c) 4 4 7 7
Adjusted EBITDA $ 2,943 $ 2,575 $ 7,077 $ 6,036
Revenue $ 58,427 $ 49,580 $ 115,896 $ 96,175
Adjusted EBITDA
Margin % (d) 5.0 % 5.2 % 6.1 % 6.3 %
Notes:
Comments