AXIL Brands, Inc. (NYSE American: AXIL) released its financial results for the first quarter of fiscal 2027, which ended on August 31, 2026. The company reported a decrease in net revenue for the period, driven by a planned transition from its XCOR product line to XCOR II and the absence of a prior-year big-box order.

For the three months ended August 31, 2026, net revenues were $6.1 million, a decrease of 11.2% compared to the $6.9 million reported in the prior-year period. Despite the revenue decline, the company reported a gross profit of $5.0 million, or 82.6% of sales. This improvement was attributed to a non-recurring $0.55 million benefit from IEEPA customs duty refunds recognized as a reduction of cost of revenues. Excluding this refund, the gross margin was approximately 73.6%.

On the balance sheet, AXIL reported a significant increase in cash holdings. As of August 31, 2026, the company held $7.9 million in cash and cash equivalents, compared to $4.5 million as of May 31, 2026. The company reported no outstanding borrowings and generated $3.8 million in net cash from operating activities during the quarter.

Operational highlights for the quarter included the announcement and launch of XCOR II, the successor to the company's flagship wireless earbud line. The product became available on September 15, 2026. As of September 30, 2026, initial orders for XCOR II exceeded $3.6 million. Management noted that first-quarter revenue did not reflect the launch investment and anticipated that these orders would convert to revenue in the second quarter of fiscal 2027.

In other business developments, AXIL brought three strategic partners into its Reviv3 ProCare Company to lead the global relaunch of the Reviv3 hair and skin care brand. In exchange for services, the partners received an aggregate ownership interest of approximately 25% in Reviv3, with AXIL retaining a 75% interest. The shares were valued at $137,511 and recorded as a non-cash expense in the first quarter.

Net income for the quarter was $0.4 million, or $0.05 per diluted share, compared to $0.3 million, or $0.04 per diluted share, in the prior year. Adjusted EBITDA was reported at $0.8 million.