\nGrove Collaborative Holdings, Inc. (NYSE: GROV) (\u201cGrove\u201d or the \u201cCompany\u201d), the world\u2019s first plastic neutral retailer and a leading sustainable consumer products company, certified B Corporation, and Public Benefit Corporation, today reported financial results for its fiscal first quarter ended March 31, 2026.<\/p>\n
Key First Quarter 2026 Financial Highlights:<\/span><\/b><\/p>\n \n\u201cWe executed with discipline in the first quarter, delivering positive Adjusted EBITDA even as net revenue reached its expected trough. That outcome reflects deliberate choices: maintaining disciplined advertising spend while stabilizing the customer experience, and letting the leaner cost structure flow through to the bottom line. What gives us confidence as we look ahead is the quality of what we’re seeing underneath the surface: repeat order rates among recent customer cohorts are performing at levels consistent with what we saw prior to the ecommerce migration, and customer acquisition costs justify a gradual increase in investment. We intend to scale spend strategically, increasing as we maintain efficiency and prioritize advertising paybacks and lifetime value.<\/p>\n \nThe most visible milestone in the quarter was the launch of our redesigned mobile application. With approximately half of non-autoship orders being placed through the app, mobile is one of the most important shopping channels for our customers – which is precisely why we made the decision to rebuild it internally. The result is a 5-star app that our customers deserve and that we now fully control, giving us the flexibility to improve and personalize it as we grow.<\/p>\n \nWe also continued to deepen Grove’s commitment to human health. In the first quarter, we expanded our ingredient standards to more than 10,000 banned or restricted ingredients \u2014 including more than 3,000 that are outright banned across every category we carry. This is what differentiates Grove: not just a curated assortment, but a platform customers can trust to make the hard calls on their behalf.<\/p>\n \nWith the first quarter behind us, we are raising both top and bottom line guidance and still expect sequential Net Revenue improvement through the remainder of 2026.\u201d<\/p>\n First Quarter 2026 Financial Results<\/span><\/b><\/p>\n (All comparisons are versus the quarter ended March 31, 2025 except where otherwise noted)<\/i><\/p>\n Net Revenue <\/b>was $36.2 million, a decline of 16.8% year-over-year. The decline was primarily driven by a smaller active customer base entering the year \u2014 reflecting the compounding impact of lower advertising investment in 2024 and 2025 and customer attrition associated with the ecommerce platform disruptions experienced throughout 2025 \u2014 as well as continued disciplined advertising investment in the first quarter, consistent with the strategy to prioritize profitability and customer experience stabilization before re-accelerating growth.<\/p>\n Gross Margin<\/b> was 54.8%, an increase of 180 basis points compared to 53.0% in the first quarter of 2025. The improvement was primarily driven by more targeted promotional activity, enabled in part by the Grove Green Rewards loyalty program launched in the fourth quarter of 2025. Grove Green Rewards has enabled a shift away from broad discounting toward more efficient incentives.<\/p>\n Operating Expenses <\/b>were $20.8 million, a decrease of 21.9% compared to $26.6 million in the prior-year period. The decline reflects the full-quarter benefit of the reduction in force executed in November 2025, lower advertising expense consistent with the current strategy, and lower fulfillment costs on reduced order volume.<\/p>\n Net Loss <\/b>was $1.0 million, or (2.8%) Net Loss margin, compared to a net loss of $3.5 million, or (8.1%) Net Loss margin, in the prior-year period. The year-over-year improvement reflects lower operating expenses.<\/p>\n Adjusted EBITDA <\/b>was positive $0.3 million, or 0.8% margin, compared to negative $1.6 million, or (3.7%) margin, in the prior-year period. This marks the second consecutive quarter of positive Adjusted EBITDA and reflects the continued focus on operating discipline as the Company completes the stabilization of the ecommerce platform.<\/p>\n Operating Cash Flow<\/b> was negative $0.7M for the quarter, primarily reflecting an increase in inventory to support ongoing operational execution, offset by the timing of payables. This compares favorably to negative $6.9 million in the prior-year period, which included a larger net loss, working capital investment in M&A, and other one-time items that did not reoccur.<\/p>\n Cash, Cash Equivalents, and Restricted Cash<\/b> totaled $10.4 million as of March 31, 2026, down from $11.8 million as of December 31, 2025, primarily reflecting cash used in operating and investing activities, including the development of the recently launched mobile application.<\/p>\n First Quarter 2026 Key Metrics<\/span>:<\/b><\/p>\n\n
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