The severe gross margin compression from tariffs and the supplier restructuring, combined with a weak Q3 outlook, creates a bearish setup. Monitor the Q3 earnings call for updates on tariff mitigation and retail demand trends. The raised full-year guidance may provide a floor, but the near-term earnings trajectory is deteriorating.
Price Chart
Executive Summary
BRP reported Q2 FY27 results with revenue up 18.5% to $2,236.8M, but a net loss of $136.8M vs. a $57.1M profit last year, driven by a 940bps gross margin collapse to 11.7% from Section 232 tariffs and a $74.8M supplier restructuring charge. The company raised full-year normalized EPS guidance to $4.00-$4.50, but guided Q3 normalized EPS down 50-60% YoY due to increased tariff impact. The combination of a massive earnings miss, severe margin compression, and a weak Q3 outlook outweighs the revenue beat and guidance raise, making this a bearish report.
Key Facts
- Q2 FY27 revenue of $2,236.8M, up 18.5% YoY, driven by higher ORV shipments and favorable SSV mix.
- Net loss of $136.8M vs. net income of $57.1M in Q2 FY26, a decline of $193.9M.
- Gross profit margin collapsed to 11.7% from 21.1% YoY, a 940bps decline, due to Section 232 tariffs and a $74.8M supplier financial restructuring charge.
- Normalized diluted EPS of ($0.18) vs. $0.92 in Q2 FY26, a miss of $1.10 per share.
- Raised full-year FY27 normalized diluted EPS guidance to $4.00-$4.50 from prior guidance, but guided Q3 FY27 normalized EPS down 50-60% YoY due to increased tariff impact.
- North American retail sales increased only 1% YoY, with market share gains in ORV offset by lower Seasonal Products retail sales.
- Free cash flow from continuing operations was $560.4M for H1 FY27, up from $301.9M in H1 FY26.
- Company announced a planned financial leadership transition.
Financial Impact
Q2 net loss of $136.8M vs. $57.1M profit YoY; gross margin fell 940bps to 11.7%; Q3 normalized EPS guided down 50-60% YoY
Risk Factors
- Further escalation of Section 232 tariffs on steel, aluminum, and copper imports into the US.
- Prolonged impact from the supplier financial restructuring.
- Weaker-than-expected consumer demand in Seasonal Products (PWC, snowmobiles) and broader macroeconomic headwinds.
- Execution risk on tariff mitigation strategies and the financial leadership transition.
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 13 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 6-K Filing (DOO) — Batch item 1 | 0001193125-26-380894 |
| Document: d118875d6k.htm | 0001193125-26-380888 |
| Document: 0001193125-26-380894-index-headers.html | 0001193125-26-380894 |
| Document: 0001193125-26-380894-index.html | 0001193125-26-380894 |
| Document: 0001193125-26-380894.txt | 0001193125-26-380894 |
| 6-K Filing (DOO) — Batch item 6 | 0001193125-26-380888 |
| Document: d117601dex991.htm | 0001193125-26-380894 |
| Document: d117601d6k.htm | 0001193125-26-380894 |
| Document: d117601dex993.htm | 0001193125-26-380894 |
| Document: d117601dex994.htm | 0001193125-26-380894 |
| Document: 0001193125-26-380888-index-headers.html | 0001193125-26-380894 |
| Document: 0001193125-26-380888-index.html | 0001193125-26-380894 |
| Document: 0001193125-26-380888.txt | 0001193125-26-380894 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Oct 7, 2026 20d ago | SC 13G/A | $55.66 | awaiting T+20 | — | $59.90 (+7.62%) |
Sep 3, 2026 7w ago | 6-K | $64.22 $56.01 | ▲ +12.79% | ▲ +11.60% | $59.90 (+6.73%) |
Sep 1, 2026 8w ago | Press Release | $61.74 $56.12 | ▼ −9.10% | ▼ −9.42% | $59.90 (−2.98%) |
Aug 21, 2026 9w ago | Institutional Cluster | $68.04 $58.16 | ▼ −14.52% | ▼ −13.99% | $59.90 (−11.96%) |
Jun 11, 2026 19w ago | Institutional Cluster | $59.12 $58.68 | ▲ +0.74% | ▲ +2.64% | $59.90 (−1.32%) |
May 28, 2026 21w ago | 6-K | $58.57 $62.32 | ▼ −6.40% | ▼ −9.55% | $59.90 (−2.27%) |
May 28, 2026 21w ago | 6-K | $58.57 $62.32 | ▲ +6.40% | ▲ +9.55% | $59.90 (+2.27%) |
Apr 22, 2026 26w ago | 6-K | $56.49 $54.17 | ▼ −4.11% | ▼ −7.27% | $59.90 (+6.04%) |
Mar 26, 2026 30w ago | 6-K | $67.08 $56.78 | ▼ −15.36% | ▼ −26.02% | $59.90 (−10.70%) |
Mar 11, 2026 32w ago | Court Ruling | $63.47 $75.76 | ▲ +19.36% | ▲ +17.07% | $59.90 (−5.63%) |
US Market Status
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