American firearm manufacturing company Ruger (NYSE: RGR) reported Q3 CY2025 results beating Wall Street’s revenue expectations, with sales up 3.7% year on year to $126.8 million. Its non-GAAP profit of $0.11 per share was 69% below analysts’ consensus estimates.

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Company Overview

Founded in 1949, Ruger (NYSE: RGR) is an American manufacturer of firearms for the commercial sporting market.

Revenue Growth

A company’s long-term sales performance is one signal of its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Unfortunately, Ruger’s 1.4% annualized revenue growth over the last five years was weak. This was below our standards and is a rough starting point for our analysis.

Long-term growth is the most important, but within consumer discretionary, product cycles are short and revenue can be hit-driven due to rapidly changing trends and consumer preferences. Ruger’s performance shows it grew in the past but relinquished its gains over the last two years, as its revenue fell by 1.9% annually.

This quarter, Ruger reported modest year-on-year revenue growth of 3.7% but beat Wall Street’s estimates by 2.1%.

Looking ahead, sell-side analysts expect revenue to remain flat over the next 12 months. Although this projection indicates its newer products and services will fuel better top-line performance, it is still below the sector average.

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Operating Margin

Ruger’s operating margin has shrunk over the last 12 months and averaged 2.7% over the last two years. The company’s profitability was mediocre for a consumer discretionary business and shows it couldn’t pass its higher operating expenses onto its customers.

This quarter, Ruger generated an operating margin profit margin of negative 2.7%, down 5.8 percentage points year on year. This contraction shows it was less efficient because its expenses grew faster than its revenue.

Earnings Per Share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

Sadly for Ruger, its EPS declined by 21.6% annually over the last five years while its revenue grew by 1.4%. This tells us the company became less profitable on a per-share basis as it expanded due to non-fundamental factors such as interest expenses and taxes.

In Q3, Ruger reported adjusted EPS of $0.11, down from $0.28 in the same quarter last year. This print missed analysts’ estimates. Over the next 12 months, Wall Street expects Ruger’s full-year EPS of $1.60 to grow 26.2%.

Key Takeaways from Ruger’s Q3 Results

It was encouraging to see Ruger beat analysts’ revenue expectations this quarter. On the other hand, its EBITDA missed and its EPS fell short of Wall Street’s estimates. Overall, this was a weaker quarter. The stock traded down 5.1% to $41.70 immediately after reporting.

The latest quarter from Ruger’s wasn’t that good. One earnings report doesn’t define a company’s quality, though, so let’s explore whether the stock is a buy at the current price. If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here, it’s free for active Edge members.