Earnings release
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... XPEL NEWS RELEASE XPEL Reports Record Revenue of $ 143.1 million ; Revenue Growth of 14.7 % in Second Quarter 2026 2026-08-05 SAN ANTONIO -- ( BUSINESS WIRE ) -- XPEL , Inc. ( Nasdaq : XPEL ) ( the " Company " ) , a global provider of protective films and coatings , announced consolidated results1 for the second quarter and six months ended June 30 , 2026 . Second Quarter 2026 Overview : • Revenue increased 14.7 % to $ 143.1 million in the second quarter of 2026 compared to $ 124.7 million in the second quarter of 2025 . • Gross margin of 44.1 % in the second quarter of 2026 compared to 42.9 % in the second quarter last year . • Net income attributable to stockholders of the company increased 10.7 % to $ 18.0 million , or $ 0.65 per basic and diluted share , versus net income attributable to stockholders of the Company of $ 16.3 million , or $ 0.59 per basic and diluted share in the second quarter of 2025 . • • Adjusted net income attributable to stockholders increased 15.6 % to $ 18.8 million . Adjusted earnings per share was $ 0.68 per basic and diluted share . Adjusted net income attributable to stockholders and adjusted earnings per share exclude costs related to the start - up and ramp - up of the Company's San Antonio and China manufacturing investments incurred prior to reaching full operational capacity . 2 EBITDA ( Earnings Before Interest , Taxes , Depreciation , and Amortization ) increased 17.6 % to $ 27.6 million , or 19.3 % of revenue , compared to $ 23.4 million , or 18.8 % of revenue in the second quarter of 2025. 2 • Adjusted EBITDA grew 20.7 % to $ 28.3 million or 19.8 % of revenue . Adjusted EBITDA excludes costs related to 1
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the start-up and ramp-up of the Company’s San Antonio and China manufacturing investments incurred prior to reaching full operational capacity. 2 First Six Months 2026 Overview: Revenue increased 14.0% to $260.4 million in the rst six months of 2026 compared to $228.5 million in the same period in 2025. Gross margin of 43.9% in the rst six months of 2026 compared to 42.6% in the rst six months last year. Net income attributable to stockholders of the company increased 14.1% to $28.4 million, or $1.03 per basic and diluted share, versus net income attributable to stockholders of the Company of $24.9 million, or $0.90 per basic and diluted share in the rst six months of 2025. EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) increased 17.7% to $44.5 million, or 17.1% of revenue, compared to $37.8 million, or 16.6% of revenue in the rst six months of 2025. 2 Ryan Pape, President and Chief Executive O cer of XPEL, commented, "We saw solid top and bottom line performance in the second quarter and nished the rst half of the year with nice momentum. We also were able to accomplish the rst key objectives of our manufacturing expansion. We look forward to continuing to execute our strategy as we progress through the remainder of the year." Financial Highlights for the Second Quarter 2026: Summary consolidated nancial information for the second quarter ended June 30, 2026 and 2025 (unaudited, dollars in thousands): Three Months Ended June 30,%Change 2026 %of TotalRevenue2025 %of TotalRevenue 2026vs.2025 Total revenue $ 143,053100.0% $ 124,713100.0% 14.7%Gross margin 63,14044.1% 53,51742.9% 18.0%Operating Expenses 39,92527.9% 34,21927.4% 16.7%Net income attributable to stockholders of the Company18,03912.6% 16,29013.1% 10.7%EBITDA2 27,55919.3% 23,43218.8% 17.6%Net cash provided by operating activities$ 30,78921.5% $ 27,88822.4% 10.4% Geographical Revenue Summary Three Months EndedJune 30, % Change% of Total Revenue 2026 2025 2026 2025 2
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2026 2025 Inc (Dec)2026 2025 United States $ 78,586$ 70,38011.7% 54.9% 56.4% Canada 15,795 14,25410.8% 11.0% 11.5% North America 94,381 84,63411.5% 65.9% 67.9%China 15,924 7,705 106.7% 11.1% 6.2% Asia Other 6,178 5,428 13.8% 4.3% 4.3% Asia Paci c 22,102 13,13368.3% 15.4% 10.5% EU, UK, and Africa16,961 17,360 (2.3)% 11.9% 13.9% India and Middle East6,410 6,746 (5.0)% 4.5% 5.4% Latin America 3,199 2,840 12.6% 2.3% 2.3% Total $ 143,053$ 124,71314.7% 100.0% 100.0% Overall Revenue Total revenue grew 14.7% compared to second quarter 2025 ("YoY"). US revenue increased 11.7% YoY. Product and Service Revenue Adjusted product revenue (combining cutbank credits revenue and product revenue) increased 14.4% YoY. Total window lm revenue increased 16.1% YoY and represented 22.7% of total revenue. Normalized total service revenue increased 16.0% YoY. Total installation revenue (labor and product combined) grew 10.8% YoY. Other Financial Information Gross margin was 44.1% and 42.9% in the second quarter of 2026 and 2025, respectively. Total operating expenses increased 16.7% YoY. Sales and marketing expenses increased 29.7% YoY and represented 10.8% of revenue. General and administrative expenses increased 9.8% YoY and represented 17.2% of revenue. Other Short Term Liabilities increased primarily due to the remaining purchase price payable pursuant to the acquisition of a manufacturing facility in China. Cash Flows from Operations Cash ows provided by operations were $30.8 million in the second quarter 2026 compared to $27.9 million in the second quarter of 2025. Cash Flows Used in Investing Activities Cash ows used in investing activities were $72.9 million in the second quarter 2026 compared to $1.3 million in the second quarter 2025. This increase was primarily due to our manufacturing investments in San Antonio and China. 2026 Third Quarter Outlook 3
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The Company expects third quarter 2026 revenue of approximately $137 - $139 million. Please see the information under "Forward-looking Statements" below regarding certain cautionary statements relating to our 2026 Third Quarter Outlook. Conference Call Information The Company will host a conference call and webcast today, August 5, 2026 at 8:30 a.m. Eastern Time to discuss the Company’s second quarter 2026 results. To access the live webcast, please visit the XPEL, Inc. website at www.xpel.com/events-presentations. To participate in the call by phone, dial (888) 506-0062 approximately ve minutes prior to the scheduled start time. International callers please dial (973) 528-0011. Callers should use access code: 840532. A replay of the teleconference will be available until September 4, 2026 and may be accessed by dialing (877) 481- 4010. International callers may dial (919) 882-2331. Callers should use conference ID: 54245. About XPEL, Inc. XPEL is a leading provider of protective lms and coatings, including automotive paint protection lm, surface protection lm, automotive and architectural window lms, and ceramic coatings. With a global footprint, a network of trained installers and proprietary DAP software, XPEL is dedicated to exceeding customer expectations by providing high-quality products, leading customer service, expert technical support and world-class training. XPEL, Inc. is publicly traded on Nasdaq under the symbol “XPEL”. 1The results summarized above for 2026 are preliminary and unaudited. As the Company completes its quarter- end nancial close processes and nalizes its nancial statements for the second quarter of 2026, it is possible that the Company may identify items that require it to make adjustments to the preliminary information set forth above, and those adjustments could be material. Full second quarter 2026 nancial information will be included in the ling of the Company’s Quarterly Report on Form 10-Q with the Securities and Exchange Commission which is anticipated on or prior to August 7, 2026. 2See "Non-GAAP Financial Measure" and "Reconciliation of Non-GAAP Financial Measure" below. Forward-looking Statements This release includes forward-looking statements (within the meaning of Section 27A of the Securities act of 1933, 4
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as amended and Section 21E of the Securities Exchange Act of 1934, as amended) regarding XPEL, Inc. and its business, which may include, but is not limited to, anticipated use of proceeds from capital transactions, expansion into new markets, execution of the company's growth strategy and outlook. Often, but not always, forward-looking statements can be identi ed by the use of words such as "plans," "is expected," "expects," "scheduled," "intends," "contemplates," "anticipates," "believes," "proposes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may," "could," "would," "might" or "will" be taken, occur or be achieved. Such statements are based on the current expectations and assumptions of the management of XPEL. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements expressed or implied by the forward-looking statements. These risks, uncertainties and other factors relate to, among others: competition, a prolonged or material contraction in automotive sales and production volumes, disruption in our supply chain, technology that could render our products obsolete, changes in the way vehicles are sold, damage to our brand and reputation, cyber events and other legal and regulatory developments. There are several risks, uncertainties, and other important factors, many of which are beyond the Company’s control, that could cause its actual results to di er materially from the forward- looking statements contained in this press release, including those described in the “Risk Factors” section of Annual Report on Form 10-K. Although XPEL has attempted to identify important factors that could cause actual actions, events or results to di er materially from those described in forward-looking statements, there may be other factors that cause actions, events or results to di er from those anticipated, estimated or intended. No forward- looking statement can be guaranteed. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and XPEL undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise. Non-GAAP Financial Measure To aid in the understanding of XPEL's ongoing business performance, XPEL uses EBITDA, a non-GAAP nancial measure. EBITDA is de ned as net income (loss) plus interest expense, net, plus income tax expense plus depreciation and amortization expense. EBITDA should be considered in addition to, not as a substitute for, or superior to, nancial measures calculated in accordance with GAAP. It is not a measurement of XPEL's nancial performance under GAAP and should not be considered as an alternative to revenue or net income, as applicable, or any other performance measures derived in accordance with GAAP and may not be comparable to other similarly title measures. For a full reconciliation of EBITDA to comparable GAAP measure, refer to the reconciliation titled "Reconciliation of Non-GAAP Financial Measure." XPEL, Inc.C lidtdStt t fI (Uditd) 5
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Consolidated Statements of Income (Unaudited)(In thousands except per share data)Three Months EndedJune 30, Six Months EndedJune 30, 20262025 2026 2025 Revenue Product revenue $111,674$ 94,795$200,388$173,507 Service revenue 31,379 29,918 60,019 55,011 Total revenue 143,053124,713260,407228,518 Cost of Sales Cost of product sales 65,462 58,190117,828106,630 Cost of service 14,451 13,006 28,209 24,475 Total cost of sales 79,913 71,196146,037131,105 Gross Margin 63,140 53,517114,37097,413 Operating Expenses Sales and marketing 15,386 11,862 30,549 23,737 General and administrative 24,539 22,357 47,595 43,258 Total operating expenses39,925 34,219 78,144 66,995 Operating Income 23,215 19,298 36,226 30,418Interest expense 262 7 266 83 Foreign currency exchange gain(403) (1,039) (683) (1,275) Income before income taxes23,356 20,330 36,643 31,610 Income tax expense 5,053 4,122 7,836 6,816 Net Income $18,303$ 16,208$ 28,807$ 24,794 Net income attributed to non-controlling interest264 (82) 423 (82) Net income attributable to stockholders of the Company$18,039$ 16,290$ 28,384$ 24,876 Earnings per share attributable to stockholders of theCompany Basic $ 0.65$ 0.59$ 1.03$ 0.90 Diluted $ 0.65$ 0.59$ 1.03$ 0.90 Weighted Average Number of Common Shares Basic 27,562 27,666 27,576 27,660 Diluted 27,643 27,673 27,654 27,675 XPEL, Inc.Consolidated Balance Sheets(In thousands except share and per share data)(Unaudited)(Audited)June 30, 2026December 31, 2025AssetsCurrent Cash and cash equivalents $ 40,675$ 50,864Accounts receivable, net 53,613 49,846Inventory 128,011 122,755Prepaid expenses and other current assets4,601 6,651 Income tax receivable — 581 Total current assets 226,900 230,697Property and equipment, net 104,460 15,797Right-of-use lease assets 17,422 21,561Intangible assets, net 53,702 49,620Deferred tax asset, net 1,776 —Other non-current assets 7,072 5,574 Goodwill 61,316 59,277 Total assets $ 472,648$ 382,526 LiabilitiesCurrent Short-term debt $ 1,344$ 59Current portion of lease liabilities 5,373 6,094Accounts payable and accrued liabilities 57,157 54,289Income tax payable 2,233 — Other short-term liabilities 20,828 10,558 Total current liabilities 86,935 71,000Df dt libilitt 120 6
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Deferred tax liability, net — 120Other long-term liabilities 10,324 9,511Non-current portion of lease liabilities 13,377 16,710 Long-term debt 43,456 — Total liabilities 154,092 97,341 Stockholders’ equity Preferred stock, $0.001 par value; authorized 10,000,000; none issued and outstanding— —Capital stock, $0.001 par value; 100,000,000 shares authorized; 27,717,393 and 27,682,807, issued,respectively 28 28Additional paid-in-capital 19,822 18,049Accumulated other comprehensive loss (1,510) (135)Retained earnings 293,723 265,339 Treasury stock, 147,645 and 78,624 shares at cost, respectively(5,938) (2,999) Stockholders’ equity 306,125 280,282 Non-controlling interest 12,431 4,903 Total stockholders’ equity 318,556 285,185 Total liabilities and stockholders’ equity$ 472,648$ 382,526 XPEL, Inc.Consolidated Statements of Cash Flows (Unaudited)(In thousands)Three Months EndedJune 30,Six Months EndedJune 30, 2026202520262025 Cash ows from operating activities Net income $ 18,303$16,208$28,807$24,794Adjustments to reconcile net income to net cash provided by operating activities:Depreciation of property, plant and equipment1,7801,5573,4023,093Amortization of intangible assets 2,1611,5384,2203,059(Gain) loss on sale of property and equipment(1) 7 (11) 7Stock compensation 1,2811,0172,2151,696Provision for credit losses 454 109 797 181Deferred income tax (1,129) (1,136) (1,571) (1,902)Changes in assets and liabilities:Accounts receivable, net (511) (3,926) (4,779) (7,841)Inventory 4,89212,099(4,066) 7,911Prepaid expenses and other current assets2,769(1,348) 1,278(1,899)Income taxes receivable and payable1,378(1,902) 2,8711,052 Accounts payable and accrued liabilities(588) 3,6655,005966 Net cash provided by operating activities30,78927,88838,16831,117 Cash ows used in investing activities Purchases of property, plant and equipment(65,105) (943) (74,820) (1,946)Proceeds from sale of property and equipment18 14 58 15Acquisition of businesses, net of cash acquired(7,136) (143) (7,136) (184) Development of intangible assets (660) (275) (878) (788) Net cash used in investing activities(72,883) (1,347) (82,776) (2,903) Cash ows from nancing activities Borrowings of debt 44,800 — 44,800—Restricted stock withholding taxes paid in lieu of issued shares(139) (68) (442) (161)Repayments of debt — (21) (59) (98)Payments of deferred acquisition consideration(6,361) — (6,631) — Purchases of treasury shares — — (2,939) — Net cash provided by (used in) nancing activities38,300(89) 34,729(259) Net change in cash and cash equivalents(3,794) 26,452(9,879) 27,955 Foreign exchange impact on cash and cash equivalents(637) (402) (310) (451) (Decrease) increase in cash and cash equivalents during the period(4,431) 26,050(10,189) 27,504 Cash and cash equivalents at beginning of period45,10623,54150,86422,087 Cash and cash equivalents at end of period$ 40,675$49,591$40,675$49,591 Supplemental schedule of non-cash activities Non-cash acquisition consideration$ 14,272$ —$14,272$ — Non-cash lease nancing $ 895$ 2,009$ 1,053$ 2,840 Issuance of Common Stock for vested restricted stock units$ 685$ 331$ 1,912$ 521 Non-cash minority interest contribution$ 7,072$ —$ 7,088$ — Supplemental cash ow information Cash paid for income taxes$ 5,340$ 6,938$ 6,613$ 7,457 Ch idf it t 7
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Cash paid for interest $ 262$ —$ 262$ 89 Reconciliation of Non-GAAP Financial Measure EBITDA is a non-GAAP nancial measure. EBITDA is de ned as net income (loss) plus interest expense, net, plus income tax expense plus depreciation expense and amortization expense. EBITDA should be considered in addition to, not as a substitute for, or superior to, nancial measures calculated in accordance with GAAP. It is not a measurement of our nancial performance under GAAP and should not be considered as alternatives to revenue or net income, as applicable, or any other performance measures derived in accordance with GAAP and may not be comparable to other similarly titled measures of other businesses. EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our operating results as reported under GAAP. EBITDA does not re ect the impact of certain cash charges resulting from matters we consider not to be indicative of ongoing operations and other companies in our industry may calculate EBITDA di erently than we do, limiting its usefulness as a comparative measure. EBITDA Reconciliation (in thousands)Three Months EndedJune 30, Six Months EndedJune 30, (Unaudited)(Unaudited)(Unaudited)(Unaudited)2026 2025 2026 2025 Net Income $ 18,303$ 16,208$ 28,807$ 24,794 Interest 262 7 266 83 Taxes 5,053 4,122 7,836 6,816 Depreciation 1,780 1,557 3,402 3,093 Amortization 2,161 1,538 4,220 3,059 EBITDA $ 27,559$ 23,432$ 44,531$ 37,845 EBITDA to Adjusted EBITDA Reconciliation (in thousands)Three Months EndedJune 30, (Unaudited)(Unaudited)2026 2025 EBITDA $ 27,559$ 23,432 Acquisition-related expenses 743 — Manufacturing investments income(10) — Adjusted EBITDA $ 28,292$ 23,432 8
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Net income Attributable to Stockholders of the Company to Adjusted Net Income Attributable to Stockholders ofthe Company Reconciliation (in thousands)Three Months EndedJune 30, (Unaudited)(Unaudited)2026 2025 Net income attributable to stockholders of the Company$ 18,039$ 16,290 Adjusting Items:Acquisition-related expenses, net of tax e ect587 — Manufacturing investments start up costs, net of tax e ect199 — Adjusted net income attributable to stockholders of the Company$ 18,825$ 16,290 Net income attributable to stockholders of the Company per diluted common share$ 0.65$ 0.59 Adjusting Items, per dilutive common share:Acquisition-related expenses, net of tax e ect0.02 — Manufacturing investments start up costs, net of tax e ect0.01 — Adjusted net income attributable to stockholders of the Company per diluted commonshare $ 0.68$ 0.59 Investor Relations: John Nesbett/Jennifer Belodeau IMS Investor Relations Phone: (203) 972-9200 Email: xpel@imsinvestorrelations.com Source: XPEL, Inc. 9