About Smith & Wesson Brands

Smith & Wesson Brands, Inc. operates as a manufacturer and designer of firearms worldwide. The company manufactures a wide array of handguns (including revolvers and pistols), long guns (including modern sporting rifles), handcuffs, firearm suppressors, and other firearm-related products for sale to a wide variety of customers, including firearm enthusiasts, collectors, hunters, sportsmen, competitive shooters, individuals desiring home and personal protection, law enforcement and security agencies and officers, and military agencies in the United States and throughout the world. The company sells its products under the Smith & Wesson, M&P, and Gemtech brands. The company manufactures its products at its facilities in Springfield, Massachusetts, Houlton, Maine, and Deep River, Connecticut. The company stores finished good inventory and fulfill customer orders from its distribution center in Columbia, Missouri. The company also sells its manufacturing services to other businesses to attempt to level-load the company’s factories. The company sells those services under its Smith & Wesson and Smith & Wesson Precision Components brands. Strategy The key elements of the company’s strategy are to drive organic growth by leveraging the company’s brands and maintaining a robust product pipeline to increase market share in markets in which the company participates; design, produce, and market high-quality, innovative firearms and related accessories that meet the needs and desires of the company’s consumer and professional customers and that drive customer satisfaction and loyalty; and create a leverageable infrastructure by streamlining and standardizing the company’s business operations. Products The company’s products combine its American manufacturing and engineering expertise with modern technological advances. Driven by the needs of the individual firearm owner, the company continually strives to improve the experience of buying, owning, and shooting a firearm. The company also strives to leverage its tradition of innovation in materials, performance, and engineering, along with the company’s proven history of reliability, to produce feature-rich, safe, durable, accurate, and high-performing firearms that satisfy the needs of the company’s broad range of customers. The company’s introduction of new products is intended to enhance its competitive position and broaden the company’s participation in the overall market. The company has always been a leader in the revolver market. The introduction of the company’s popular M&P pistol in 2005 resulted in the company becoming one of the leaders in the polymer pistol market as well, serving both the consumer sporting goods market and law enforcement agencies. The launch of the company’s M&P modern sporting rifle in 2006 enabled the company to capture what the company estimates is the leading share of the modern sporting rifle market. The addition of the company’s Gemtech branded firearm suppressor products in 2017 expanded the company’s firearm-related product offerings. The company’s firearm suppressors are compatible with most pistols and rifles on the market and complement the company’s firearm products. The company participates in two categories of the long gun market: modern sporting rifles and shotguns and both core categories of the handgun market: semi-automatic pistols and revolvers. Product Development All of the company’s firearms and firearm-related products are sold under its Smith & Wesson and Gemtech brands. The company’s customers include distributors; federal, state, and municipal law enforcement agencies and officers; government and military agencies; and retailers. The company’s product development strategy is to understand the company’s consumers’ needs and preferences and then design and develop products to uniquely meet those requirements. Throughout this process, the company tests multiple concepts with firearm owners and potential purchasers. The company compares these test results against a growing database of prior concepts to identify those with the greatest market potential. Additional market research is completed to optimize the desired features and benefits. While this development process is ongoing, the company’s launch timing for new products depends on market conditions to maximize sales across the entire product portfolio. In the year ended April 30, 2023 (fiscal 2023), the company introduced a number of new products, including the Smith & Wesson M350 revolver, which is a double-action/single-action revolver that expanded on the company’s X-frame line of revolvers; the M&P9 M2.0 Metal pistol, which features an aluminum frame, the new M2.0 flat trigger design, and a 17-round capacity, as well as the company’s C.O.R.E red dot mounting system; the Smith & Wesson Equalizer , which features 10-round, 13-round, and 15-round magazine options; the M&P 5.7, the company’s first handgun offering in the increasingly popular 5.7x28mm caliber, which features a new and innovative design, the Tempo Barrel System (a rotating design that harnesses the speed of the 5.7x28mm round); and the M&P FPC, an innovative side-folding pistol carbine featuring a threaded barrel, in-stock magazine storage, and a locking latch for secure transportation that is compatible with full-size and compact 9mm M&P magazines. The company’s customers continue to demand premium firearms that provide a competitive edge in sport shooting and hunting. The company’s Performance Center products are engineered and manufactured to meet this need, and they incorporate many custom features not found in the company’s standard products, such as enhanced triggers for smoother trigger pull, ported barrels for better muzzle control, and specialty sights for quicker target acquisition. In fiscal 2023, the company introduced the Performance Center M&P9 Competitor, which features a Performance Center trigger, the company’s C.O.R.E red dot mounting system, flat-face trigger design, enhanced sear for a better trigger feel, flared magazine well, oversized magazine release, and lightening cuts on the slide. In fiscal 2023, the company also introduced several new and innovative products within the company’s Gemtech line of firearm suppressors, including the Neutron 7.62, which is a 6.6’ firearm suppressor that is both durable and light and that features Gemtech's ETM (easy-to-mount) application; the Abyss 5.56, which is designed to allow rounds to pass through the suppressor while gasses expand into the baffle spaces, lowering pressure, minimizing muzzle flash, and reducing decibels; and the GVAC 5.56 Upper system, which was designed to optimize suppressed shooting by utilizing a gas block system to reduce the amount of gas blowback. Handguns The company manufactures an extensive variety of handgun models that includes revolvers and pistols. A revolver is a handgun with a cylinder that holds the ammunition in a series of rotating chambers that are successively aligned with the barrel of the firearm during each firing cycle. There are two general types of revolvers: single-action and double-action. To fire a single-action revolver, the hammer is pulled back to cock the firearm and align the cylinder before the trigger is pulled. To fire a double-action revolver, a single trigger pull advances the cylinder as it cocks and releases the hammer. A pistol is a handgun in which the ammunition chamber is an integral part of the barrel and which is fed ammunition from a magazine contained in the grip. The firing cycle ejects the spent casings and loads a new round into the chamber. The company has long been known as an innovator and leader in the revolver market and most of the company’s revolvers are marketed under the Smith & Wesson brand. The company sells a wide range of sizes from small-frame revolvers used primarily for concealed carry and personal protection to large-frame revolvers used primarily for recreational and competitive sport shooting. The company’s extra-large frame revolvers primarily address the handgun-hunting market. The company’s small-frame revolvers have been carried by law enforcement personnel and personal defense-minded citizens. The company’s revolvers are available in a variety of models and calibers, with applications in virtually all professional and consumer markets. The company offers pistols under its Smith & Wesson brand. The company’s full size and compact M&P line of pistol products have been engineered with input from professional users and are designed to offer performance, safety, and durability that meet the standards of global law enforcement and military personnel, as well as features attractive to consumers. The company’s M&P branded pistol products are the most ergonomic, feature-rich, and innovative products on the market. The company’s range of full-size and compact M&P pistol products are made with a polymer frame, a rigid stainless-steel chassis, and a black, through-hardened corrosion resistant finished stainless-steel barrel and slide for durability. The company’s M&P pistol products feature patented and easily changed palm swell grips in four sizes, allowing the user to customize grips in a matter of seconds; a passive trigger safety to prevent the pistol from firing if dropped; an enlarged trigger guard to accommodate gloved hands; a sear lever release that eliminates the need to press the trigger in order to disassemble the firearm; an ambidextrous slide stop and reversible magazine release to accommodate right- and left-handed shooters; an optional internal locking system and magazine safety; and a universal equipment rail to allow the addition of accessories, including lights and lasers. In 2012, the company launched the M&P Shield pistol to address the growing personal protection and concealed carry market. The M&P Shield features a slim concealable profile, 9mm, 380 Auto, 40 S&W, and 45 Auto calibers, and M&P ergonomics. Since the launch of the M&P Shield, the company has introduced several additional models, most recently, the Shield Plus with enhanced features and capacity. The M&P Shield pistol is one of the most popular firearms in the market, with over five million units having been shipped. The company’s Performance Center department provides specialized products and services for the most demanding shooting sports enthusiasts. To meet the requirements of law enforcement professionals, competitive shooters, collectors, and discriminating sport enthusiasts who demand superior products, the company’s Performance Center personnel conceptualize, engineer, and craft products to create enhanced versions of the company’s standard products. The company’s craftsmen are highly skilled and experienced gunsmiths. Performance Center products are typically made in limited production quantities, although the company offers a number of catalog variations in order to increase product availability. The company’s ‘Classics’ department makes it possible to own historic firearms that are manufactured today but modeled after original favorites, such as the Model 29, the firearm made famous by the movie character Dirty Harry. These firearms are newly crafted with designs that take advantage of some of the most famous and collectible firearms that the company has ever made. The company’s Classics department also makes commemorative firearms and employs master engravers to craft one-of-a-kind custom firearms. These custom-made applications reflect the skill and vision of the master engraver and the artistic expression of the owner. The company offers a number of catalog variations of Classics and engraved Classics to the company’s customers. Long Guns The company’s modern sporting rifles are designed to satisfy the functionality and reliability needs of recreational, personal, defense, and professional users, including global military, law enforcement, and security personnel. These long guns are popular with consumers as hunting, personal protection, and sporting target rifles and are sold through the company’s sporting good distributors, retailers, and dealers. The company offers M&P and Volunteer series modern sporting rifles in four different calibers (22LR, 5.56mm NATO (223), 308 Winchester (7.62x51mm), and 6.5 Creedmoor) for multiple recreational and professional uses. The company also offers upper assemblies so firearm owners can easily modify their modern sporting rifle to suit the needs and tasks of the various forms of sport shooting and hunting. The company’s broad product portfolio of modern sporting rifles includes a .22 caliber model, an opening price-point sport model, a hunting caliber model for longer range effectiveness, and several models designed for professional users. In fiscal 2023, the company continued to expand the company’s modern sporting rifle line with the introduction of the Volunteer series, which is designed to deliver the rugged performance of competition-ready S&W precision with the advantage of the name-brand accessories that discerning shooters want. In fiscal 2023, the company introduced the 6mm ARC to the line. This budding caliber offers improved long-range capabilities and was intended to keep the company’s Volunteer Series at the forefront of this evolving category. Other Products and Manufacturing Services The company’s other products and manufacturing services include the following: Parts: The company sells parts to support its firearm business, including barrels and magazines that are manufactured at the company’s facilities or purchased from third parties. Handcuffs: The company is one of the largest manufacturers of handcuffs and restraints in the United States. The company fabricates these products from the highest-grade carbon or stainless steel. The company’s patented Lever Lock cuffs offer a double-locking system for added security and comfort, without extra tools or keys. Internal locks help prevent tampering and smooth ratchets allow for swift cuffing and an extra measure of safety. The company has the ability to customize handcuffs to fit customer specifications. Firearm Suppressors: The company is one of the nation’s oldest firearm suppressor manufacturers and an active participant in the firearm suppressor market around the world. The company’s Gemtech branded firearm suppressors have been involved in setting standards used by the military in suppressor testing, implementation, and safety. The company’s firearm suppressors are constructed from high grade aluminum, steel, or titanium and are compatible with every major type of rimfire and centerfire pistol and centerfire rifle caliber on the market. Manufacturing Services: The company utilizes its substantial manufacturing capabilities to provide services to third-party customers. The company’s manufacturing services include forging, heat treating, rapid prototyping, tooling, finishing, plating, machining, and custom plastic injection molding. The company’s manufacturing services provide the company with increased flexibility and reduced supply chain risk. The company markets its manufacturing services under the Smith & Wesson and Smith & Wesson Precision Components brand names. Marketing, Sales, and Distribution The company goes to market in a variety of ways, including two-step distribution, strategic retailers, and buying groups consisting of certain large, regional retailers, utilizing direct sales employees to service these customers. The company also sells firearms directly to law enforcement agencies and manufacturing services directly to other businesses. The company sells internationally primarily through distributors, which, in turn, sell to retail stores and government agencies. The company sells its products worldwide. The company’s businesses own tooling that is located at various suppliers in Asia and North America. The company markets its products using a multi-faceted approach to consumers through independent dealers, large retailers, in-store retail channels, direct to consumer, and range operations using focused marketing and promotional campaigns, which include print, broadcast, and digital advertising campaigns; social and electronic media; and in-store retail merchandising strategies. The company is prominently featured in vertical print media, including editorial coverage in an extensive list of leading firearms and outdoor magazines, including Guns & Ammo, American Rifleman, Shooting Times, American Handgunner, Shooting Illustrated, American Hunter, Outdoor Life, and Field & Stream. The company also sponsors many outdoor television, internet, and online programs that generate significant editorial exposure. The company sponsors a number of firearm safety, shooting, and hunting events and organizations. The company prints various product catalogs that are distributed to the company’s dealers and mailed directly, on a limited basis, to consumers. GUNSMARTS: The SMITH & WESSON GUNSMARTS program is designed to welcome new firearm owners into the firearm community and highlight key resources available to those who have just purchased their first pistol, rifle, or revolver. As a cornerstone of the campaign, the company released a new video series devoted to helping inform, educate, and excite those who have recently joined the firearm community. Hosted on YouTube, the SMITH & WESSON GUNSMARTS video series covers a comprehensive set of topics that takes the viewer from the basics of firearm safety through their first trips to the range – all in a simple, inviting manner. In fiscal 2023, the company introduced its third season of GUNSMARTS, which provides beginner, intermediate, and advanced shooters with valuable education and instruction around firearm safety, personal defense, shooting sports, and recreational firearm use. Digital Marketing The company utilizes its websites, including www.smith-wesson.com and www.gemtech.com, to market the company’s products and services and to provide a wide range of information regarding the company to customers, consumers, dealers, distributors, investors, and government and law enforcement agencies worldwide. Social media platforms, such as Facebook, Instagram, YouTube, LinkedIn, and Twitter, are effective ways for the company to communicate the features and benefits of its products. The company’s direct-to-consumer e-mail marketing helps the company to further engage its consumers and communicate the value of the company’s brands. The company continues to invest in new digital marketing capabilities to provide best-in-class customer experiences. The company’s websites are designed to inform, inspire, and prepare the company’s customers for the next step in their firearms journey. The company’s digital platform supports future sales growth and profitability. Service and Support The company utilizes a variety of methods for supporting the company’s consumers and dealers. The company has a toll-free customer service number, e-mail, and social media messaging to answer questions and resolve issues regarding the company’s products. In addition, the company offers a limited one-year warranty program and a lifetime service policy under which the company repairs defects in material or workmanship in the company’s products without charge for as long as the original purchaser owns the firearm. The company also maintains a number of authorized warranty centers throughout the world and provides both warranty and charge repair services at the company’s facilities. Research and Development In fiscal 2023, the company’s gross spending on research activities relating to the development of new products was $7.6 million. Patents, Trademarks, and Copyrights The company’s Smith & Wesson and Gemtech brands, and the company’s S&W monogram trademarks are known and recognized by the public worldwide and are important to the company’s firearm business. Smith & Wesson, S&W, M&P, M&P Shield, Performance Center, Airlite, Airweight, American Guardians, America’s Master Gunmaker, Armornite, Arrow, Aurora, Aurora-II, Blast Jacket, Bodyguard, Carry Comp, Chiefs Special, Club 1852, Compass, Competitor, Contender, CSX, Dagger, Encore, E-Series, EZ, Flextech, G-Core, Gemtech, Gemtech Suppressors, Gemtech World-Class Silencers, GM, GMT-Halo, Governor, Integra, Lady Smith, Lever Lock, Lunar, M&P FPC, M2.0, Mag Express, Magnum, Maxi-Hunter, Mist-22, Mountain Gun, Number 13, PC, Power Rod, Protected by Smith & Wesson, Put A Legend On Your Line, QLA, Quick Load Accurizor, Quickmount, Shield, Smith & Wesson Collectors Association, Smith & Wesson Performance Center, Smith & Wesson Precision Components, Speed Breech, Speed Breach XT, SW Equalizer, SW22 Victory, Swing Hammer, T/C, T/CR22, T17, The S&W Bench, The Sigma Series, Thompson/Center, Trek, Triumph, U-View, Viper, and Weather Shield are some of the registered U.S. trademarks of the company or one of its subsidiaries. Competition The company’s primary competitors are Ruger and Taurus in the revolver market; Glock, Ruger, Sig Sauer, Springfield Armory, and Taurus in the pistol market; and Sig Sauer, Ruger, Springfield Armory, and Daniel Defense in the modern sporting rifle market. Customers The company sells its products through a variety of federally licensed distribution channels. Depending upon the product or service, the company’s customers include distributors; federal, state, and municipal law enforcement agencies and officers; government and military agencies; and retailers. During fiscal 2023, sales into the company’s professional channel accounted for approximately 8.5% of the company’s net sales, which included state and local law enforcement agencies, the federal government, and international customers. The remaining 91.5% of the company’s net sales was through federal firearm licensees to domestic consumers. Seasonality The company’s business is seasonal with sales generally peaking in the company’s fourth fiscal quarter, which ends April 30, as a result of most industry events and distributor shows normally scheduled during the early spring months. In addition, because of the company’s operating schedule, which includes a summer and a winter shutdown of the company’s manufacturing facilities, the company has an increased number of operating days in the company’s fourth fiscal quarter, which allows the company’s shipping and production volumes to exceed other quarters. Governmental Regulations of Firearms The company’s business is primarily regulated by the ATF (the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives), which licenses the manufacture, sale, and import of firearms and firearm suppressors in the United States. The ATF conducts periodic audits of the company’s facilities that hold federal firearms licenses. Environmental Health and Safety The company is subject to numerous federal, state, and local laws and regulations that regulate the health and safety of the company’s workforce, including those regulations monitored by the Occupational Health and Safety Administration, or OSHA, the National Fire Protection Association, and the Department of Public Health. Though not exhaustive, examples of applicable regulations include confined space safety, walking and working surfaces, machine guarding, and life safety. The company is also subject to numerous federal, state, and local environmental laws and regulations concerning, among other things, emissions to the air; discharges to land, surface, subsurface strata and water; and the generation, handling, storage, transportation, treatment, and disposal of hazardous waste and other materials. Several of the more significant federal laws applicable to the company’s operations include the Clean Air Act; the Clean Water Act; the Comprehensive Environmental Response, Compensation and Liability Act, or CERCLA; and the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act, or RCRA. The company has received notice that the company is a potentially responsible party from the Environmental Protection Agency and/or individual states under CERCLA or a state equivalent at two sites. History The company was founded in 1852. It was formerly known as Smith & Wesson Holding Corporation and changed its name to American Outdoor Brands Corporation in 2017. Further, the company changed its name to Smith & Wesson Brands, Inc. in 2020.