Latham’s first quarter results were marked by positive market reaction despite revenue falling short of Wall Street’s expectations. Management emphasized that sales grew across all product lines, with notable gains in Florida driven by the company’s Sand States strategy. CEO Sean Gadd cited the “double-digit sales gains in fiberglass pools in our priority Florida market” and highlighted adverse weather in North America as a headwind that tempered organic growth but did not derail momentum. The company’s ongoing investments in brand awareness, dealer partnerships, and manufacturing efficiency were cited as key contributors to the quarter’s performance.
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Latham (SWIM) Q1 CY2026 Highlights:
- Revenue: $117.3 million vs analyst estimates of $119.2 million (5.3% year-on-year growth, 1.6% miss)
- Adjusted EPS: -$0.04 vs analyst estimates of -$0.04 (in line)
- Adjusted EBITDA: $12.16 million vs analyst estimates of $12.88 million (10.4% margin, 5.6% miss)
- The company reconfirmed its revenue guidance for the full year of $595 million at the midpoint
- EBITDA guidance for the full year is $112.5 million at the midpoint, above analyst estimates of $110.4 million
- Operating Margin: -5.6%, down from -4.4% in the same quarter last year
- Market Capitalization: $630.5 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Latham’s Q1 Earnings Call
- Ryan James Merkel (William Blair) asked about the strength of the fiberglass order backlog as the season begins. CEO Sean Gadd confirmed that order trends in April were strong and the company feels confident reaffirming guidance.
- Gregory William Palm (Craig-Hallum Capital Group) questioned how Latham is handling input cost volatility and potential resin shortages. CFO Oliver Gloe explained that transportation headwinds are being managed with fuel surcharges and there are no current material shortages due to diversified sourcing.
- Timothy Ronald Wojs (Baird) sought clarity on whether investments in sales initiatives are incremental or reallocated. Gadd responded that both approaches are being used, with additional front-end investment balanced by efficiencies elsewhere to keep SG&A ratios stable.
- William Andrew Carter (Stifel) probed the implications of transportation surcharges and whether product pricing could adjust mid-season. Gloe noted the surcharge represents about 60 basis points and that mid-season price changes are possible, though not preferred.
- Analyst (Barclays) asked about top buyer concerns and fiberglass awareness. Gadd identified financing difficulties and increased competition for each sale, but stated that smaller pool sizes and the benefits of fiberglass remain attractive in the current environment.
Catalysts in Upcoming Quarters
Going forward, the StockStory team will closely watch (1) the pace of sales growth in targeted Sand States neighborhoods, (2) the effectiveness of operational efficiency programs in supporting margins despite rising input and freight costs, and (3) the realization of synergies from the Freedom Pools acquisition. Shifts in consumer demand or disruptions in supply chains will also be important markers of execution.
Latham currently trades at $5.38, down from $5.86 just before the earnings. At this price, is it a buy or sell? The answer lies in our full research report (it’s free).
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