The tariffs mainly concern his outdoor products – hunting and fishing accessories, which account for more than a quarter of his turnover. Many of these products are manufactured in China, and the company warned that there are few alternatives to pay except tariffs when they come into effect this year.
"Given the worsening tariff situation, opportunities to offset these effects have begun to decline rapidly," said CEO James Debney in a conversation with investors on Thursday. "Our supply chain in China is relatively sophisticated compared to other low-priced countries, making a quick changeover difficult, and it takes some time to bring a brand new manufacturer online, and the duration of the tariff is still very unclear."
"Without these effects, we would not have matched the earnings per share of our most recent forecast, but tariffs are making it unlikely now," said CFO Jeffrey Buchanan.
The company did not disclose how many of its firearms are manufactured in China, although the business faces the separate problem of lower arms sales across the industry. The company's handgun deliveries decreased 7% in the quarter, and supplies of rifles such as rifles decreased 8%. Much of the decline was attributable to late-quarter promotions, which increased supplies during this period but have recently led to sales declines.