Winmark Corp 10-Q for FY2026 Q3

Winmark Corp (WINA)

10-Q 2026-10-14 For: 2026-09-26

Added on October 14, 2026

About this 10-Q

Winmark Corp filed this 10-Q on October 14, 2026, covering the quarter ended September 26, 2026 (FY2026 Q3).

For the first nine months of 2026, Winmark reported revenue of $70.7 million and royalties of $61.1 million, up 6.5%, ending with 1,398 franchised stores and renewal of all 77 available franchise agreements. AI summary

Headline figures

Quarter ended September 26, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $27.89M; up 23.2% from $22.63M a year earlier
Net income: $11.82M; up 6.1% from net income of $11.14M a year earlier
Diluted EPS: $3.21; up 6.3% from $3.02 a year earlier

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Minnesota		41-1622691
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)


Title of each class:	Trading Symbol	Name of each exchange on which registered:
Common Stock, no par value per share	WINA	Nasdaq Global Market


		PAGE

PART I.	FINANCIAL INFORMATION

Item 1.	Financial Statements (Unaudited)

	CONSOLIDATED CONDENSED BALANCE SHEETS September 26, 2026 and December 27, 2025	3

	CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS Three Months Ended September 26, 2026 and September 27, 2025 Nine Months Ended September 26, 2026 and September 27, 2025	4

	CONSOLIDATED CONDENSED STATEMENTS OF SHAREHOLDERS’ EQUITY (DEFICIT) Three Months Ended September 26, 2026 and September 27, 2025 Nine Months Ended September 26, 2026 and September 27, 2025	5

	CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS Nine Months Ended September 26, 2026 and September 27, 2025	6

	NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	13

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	19

Item 4.	Controls and Procedures	19

PART II.	OTHER INFORMATION	19

Item 1.	Legal Proceedings	19

Item 1A.	Risk Factors	19

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	20

Item 3.	Defaults Upon Senior Securities	20

Item 4.	Mine Safety Disclosures	20

Item 5.	Other Information	20

Item 6.	Exhibits	21

	SIGNATURES	22


		September 26, 2026			December 27, 2025
ASSETS
Current Assets:
Cash and cash equivalents		$	27,964,200		$	10,295,700
Restricted cash			150,000			165,000
Receivables, less allowance for credit losses of $500 and $500			2,253,300			1,483,500
Income tax receivable			—			463,600
Inventories			789,200			362,500
Prepaid expenses			1,447,200			1,325,700
Total current assets			32,603,900			14,096,000
Property and equipment, net			1,214,400			1,219,000
Operating lease right of use asset			1,482,300			1,761,500
Intangible assets, net			2,020,800			2,286,300
Capitalized software			2,272,400			—
Goodwill			607,500			607,500
Other assets			528,500			506,400
Deferred income taxes			4,304,900			4,407,400
		$	45,034,700		$	24,884,100

LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
Current Liabilities:
Accounts payable		$	1,824,800		$	1,673,900
Income tax payable			100,200			—
Accrued liabilities			6,612,500			2,324,800
Deferred revenue			1,666,900			1,667,300
Total current liabilities			10,204,400			5,666,000
Long-term Liabilities:
Line of credit/Term loan			30,000,000			30,000,000
Notes payable, net of unamortized debt issuance costs of $25,300 and $39,000			29,974,700			29,961,000
Deferred revenue			8,447,400			8,350,100
Operating lease liabilities			1,869,500			2,414,200
Other liabilities			1,936,000			2,175,200
Total long-term liabilities			72,227,600			72,900,500
Shareholders’ Equity (Deficit):
Common stock, no par value, 10,000,000 shares authorized, 3,559,195 and 3,571,861 shares issued and outstanding			15,181,700			19,612,800
Retained earnings (accumulated deficit)			(52,579,000)			(73,295,200)
Total shareholders' equity (deficit)			(37,397,300)			(53,682,400)
		$	45,034,700		$	24,884,100


		Three Months Ended						Nine Months Ended
		September 26, 2026			September 27, 2025			September 26, 2026			September 27, 2025
Revenue:
Royalties		$	21,707,800		$	20,911,300		$	61,087,600		$	57,348,000
North American advertising fund			3,825,300			—			3,825,300			—
Software			497,100			93,100			678,900			278,900
Franchise fees			330,100			417,600			1,092,500			1,088,100
Merchandise sales			1,031,500			693,600			2,544,700			2,438,500
Leasing income			—			46,600			—			2,401,100
Other			498,700			470,700			1,477,200			1,414,800
Total revenue			27,890,500			22,632,900			70,706,200			64,969,400
North American advertising fund expense			3,825,300			—			3,825,300			—
Cost of merchandise sold			947,300			663,300			2,384,200			2,318,100
Selling, general and administrative expenses			7,332,100			7,046,400			22,708,200			21,070,500
Income from operations			15,785,800			14,923,200			41,788,500			41,580,800
Interest expense			(610,300)			(610,300)			(1,834,000)			(1,833,900)
Interest and other income			242,100			310,300			516,500			714,800
Income before income taxes			15,417,600			14,623,200			40,471,000			40,461,700
Provision for income taxes			(3,599,500)			(3,486,700)			(9,003,300)			(8,767,500)
Net income		$	11,818,100		$	11,136,500		$	31,467,700		$	31,694,200
Earnings per share - basic		$	3.29		$	3.13		$	8.79		$	8.94
Earnings per share - diluted		$	3.21		$	3.02		$	8.51		$	8.61
Weighted average shares outstanding - basic			3,588,328			3,553,211			3,581,906			3,543,766

Weighted average shares outstanding - diluted			3,685,668			3,693,154			3,697,251			3,679,745


							Retained
							Earnings
		Common Stock					(Accumulated
		Shares		Amount			Deficit)			Total
BALANCE, December 27, 2025		3,571,861		$	19,612,800		$	(73,295,200)		$	(53,682,400)
Stock options exercised		5,810			1,033,900			—			1,033,900
Compensation expense relating to stock options		—			614,100			—			614,100
Cash dividends ($0.96 per share)		—			—			(3,429,000)			(3,429,000)
Comprehensive income (Net income)		—			—			9,254,700			9,254,700
BALANCE, March 28, 2026		3,577,671			21,260,800			(67,469,500)			(46,208,700)
Stock options exercised		9,408			1,235,400			—			1,235,400
Compensation expense relating to stock options		—			614,200			—			614,200
Cash dividends ($1.02 per share)		—			—			(3,658,400)			(3,658,400)
Comprehensive income (Net income)		—			—			10,394,800			10,394,800
BALANCE, June 27, 2026		3,587,079			23,110,400			(60,733,100)			(37,622,700)
Repurchase of common stock		(33,024)			(9,845,600)			—			(9,845,600)
Stock options exercised		5,140			1,227,900			—			1,227,900
Compensation expense relating to stock options		—			689,000			—			689,000
Cash dividends ($1.02 per share)		—			—			(3,664,000)			(3,664,000)
Comprehensive income (Net income)		—			—			11,818,100			11,818,100
BALANCE, September 26, 2026		3,559,195			15,181,700			(52,579,000)			(37,397,300)


Contract Liabilities expected to be recognized in	Amount
2026	$	412,900
2027		1,622,700
2028		1,453,300
2029		1,304,900
2030		1,191,300
Thereafter		4,129,200
	$	10,114,300


Amortization expected to be expensed in	Amount
2026	$	88,500
2027		354,000
2028		354,000
2029		354,000
2030		354,000
Thereafter		516,300
	$	2,020,800


Operating Lease Liabilities expected to be recognized in		Amount
2026		$	210,800
2027			851,100
2028			874,600
2029			898,700
2030			—
Thereafter			—
Total lease payments			2,835,200
Less imputed interest			(241,200)
Present value of lease liabilities		$	2,594,000


										AVAILABLE
		TOTAL						TOTAL		FOR		COMPLETED
		12/27/2025		OPENED		CLOSED		9/26/2026		RENEWAL		RENEWALS		% RENEWED
Plato’s Closet		526		7		(3)		530		28		28		100	%
Once Upon A Child		441		15		(5)		451		31		31		100	%
Play It Again Sports		309		11		(5)		315		12		12		100	%
Style Encore		67		—		(2)		65		3		3		100	%
Music Go Round		35		2		—		37		3		3		100	%
Total Franchised Stores		1,378		35		(15)		1,398		77		77		100	%


							Total Number of		Maximum Number
							Shares Purchased as		of Shares that may
		Total Number of		Average Price			Part of a Publicly		yet be Purchased
Period		Shares Purchased		Paid Per Share			Announced Plan(1)		Under the Plan

June 28, 2026 to August 1, 2026		—		$	—		—		70,656
August 2, 2026 to August 29, 2026		—		$	—		—		70,656
August 30, 2026 to September 26, 2026		33,024		$	298.14		33,024		37,632

3.1		Articles of Incorporation, as amended (Exhibit 3.1)(1)

3.2		By-laws, as amended and restated to date (Exhibit 3.2)(2)

31.1		Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*

31.2		Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*

32.1		Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*

32.2		Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*

101		Interactive Data Files Pursuant to Rule 405 of Regulation S-T: Financial statements from the Quarterly Report on Form 10-Q of Winmark Corporation and Subsidiaries for the quarter ended September 26, 2026, formatted in Inline XBRL: (i) Consolidated Condensed Balance Sheets, (ii) Consolidated Condensed Statements of Operations, (iii) Consolidated Condensed Statements of Shareholders’ Equity (Deficit), (iv) Consolidated Condensed Statements of Cash Flows, and (v) Notes to Consolidated Condensed Financial Statements.
104		The cover page from the Quarterly Report on Form 10-Q of Winmark Corporation and Subsidiaries for the quarter ended September 26, 2026, formatted in Inline XBRL (contained in Exhibit 101).

		WINMARK CORPORATION


Date: October 14, 2026	By:	/s/ Brett D. Heffes
		Brett D. Heffes Chair of the Board and Chief Executive Officer (principal executive officer)


Date: October 14, 2026	By:	/s/ Anthony D. Ishaug
		Anthony D. Ishaug Chief Financial Officer and Treasurer (principal financial and accounting officer)


							Weighted Average
							Remaining
		Number of		Weighted Average			Contractual Life
		Shares		Exercise Price			(years)			Intrinsic Value
Outstanding, December 27, 2025		315,002		$	238.30
Granted		32,868			377.89
Exercised		(20,358)			171.78
Forfeited		(1,866)			365.90
Outstanding, September 26, 2026		325,646		$	255.81		5.52		$	22,886,200
Exercisable, September 26, 2026		234,028		$	207.09		4.27		$	22,400,400


		Nine Months Ended			Nine Months Ended
		September 26, 2026			September 27, 2025
Risk free interest rate			4.26	%		4.05	%
Expected life (years)			6.7			6.8
Expected volatility			28.78	%		29.31	%
Dividend yield			3.06	%		2.70	%
Option fair value		$	97.36		$	109.37