Black Diamond Apparel Streak Reaches Five Quarters as DOJ Closes Transceiver Investigation

Clarus Corporation (NASDAQ: CLAR) reported a pivotal second quarter CY2026, driven by an 8.5% sales increase in its flagship Outdoor segment and the resolution of a major legal overhang.

The parent company of Black Diamond Equipment posted a net income of $4.7 million for the quarter—a sharp turnaround from a net loss of $8.4 million in the same period last year. The positive results were bolstered by a $6.1 million U.S. International Emergency Economic Powers Act (IEEPA) tariff refund, which helped push consolidated gross margin to 48.9%.

Beyond the balance sheet improvements, two key operational milestones highlighted the quarter:

1. Apparel Streak Extends to Five Quarters

Black Diamond’s technical apparel division delivered its fifth consecutive quarter of top-line growth, solidifying its place as a cornerstone of Clarus' long-term commercial strategy.

Full-price apparel sales surged 22.9%, while clearance and closeout merchandise dropped by 61%.

"Apparel is a key pillar of our long-term strategy," stated Warren Kanders, Executive Chairman of Clarus. "Our product continues to resonate with the consumer as we delivered apparel sales growth for the fifth consecutive quarter."

Neil Fiske, President of Black Diamond Equipment, noted that wholesale partnerships have "never been stronger." European wholesale sales surged 25.3% in U.S. dollars (+16.7% in constant currency), while North American digital direct-to-consumer (DTC) revenue expanded by 5.7%.

2. DOJ Closes Criminal Investigation

On June 4, the U.S. Department of Justice (DOJ) officially informed Clarus and Black Diamond that it had closed its criminal investigation into the company. The federal probe stemmed from unresolved reporting obligation questions originally referred by the Consumer Product Safety Commission (CPSC) regarding Black Diamond's avalanche transceivers.

The DOJ also formally advised former Black Diamond President John Walbrecht and former Director of Quality Rick Vance that the criminal investigation concerning them individually had been closed as well.

Closing the investigation removes significant uncertainty for the brand and directly impacts the company's bottom line. Clarus expects to save approximately $2 million in legal fees during the second half of the year.

Upgraded Outlook & Strategic Direction

With legal expenses dropping and the tariff refund in hand, Clarus raised its full-year adjusted EBITDA forecast to $12 million – $13 million (up from its prior guidance of $3 million – $5 million) on full-year revenue projections of $245 million – $255 million.

While the company's Adventure segment (housing vehicle-based accessory brands like Rhino-Rack and MAXTRAX) continues to navigate broader retail headwinds, Black Diamond's core climbing and mountain momentum position Clarus on firmer footing as its board continues to evaluate strategic alternatives to maximize shareholder value.