RGR - Are Gunmakers Really Being Hurt by the Gun Sales Slump?
Since the onset of the pandemic, the firearms industry has been on fire with 2020 holding the all-time record for gun sales and last year being the second-biggest year. But industry demand is slowing now, and gun manufacturers are seeing a hit to their top-line numbers.
Sturm, Ruger (NYSE: RGR) reported a 10% year-over-year drop in fiscal first-quarter revenue to $166.6 million, which CEO Chris Killoy acknowledged came from "consumer demand for firearms (subsiding) from the unprecedented levels of the surge that began early in 2020." Smith & Wesson Brands (NASDAQ: SWBI) also reported fiscal-third-quarter results in March that showed a 31% slide in sales .
It's no surprise consumer demand is down as fears of the COVID outbreak and the unrest that followed have subsided. What might not be obvious, though, is the fact gun sales remain elevated, and 2022 is still on track to be the third-biggest year for the industry since the FBI began tracking the data.
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Are Gunmakers Really Being Hurt by the Gun Sales Slump?