PSQ (NYSE:PSQH) reported what management described as meaningful progress in the first quarter of 2026, with executives pointing to faster revenue growth, lower operating expenses and improving cash efficiency following the company’s shift toward a focused financial technology model.
Chairman and Chief Executive Officer Dusty Wunderlich said the quarter showed the company was delivering on commitments made at the end of 2025 to narrow its strategy, improve operational accountability, reduce cash usage and raise revenue per employee.
Revenue Rises as Operating Expenses Decline
Chief Accounting Officer Krista Wenzel said net revenue from continuing operations was $8.2 million, up from $3.1 million in the prior-year quarter, representing 167% year-over-year growth. She said the growth was driven by payments, Cordova’s loan and lease origination activity and lease merchandise revenue.
Wenzel said first-quarter revenue from continuing operations included:
- $3.7 million in payment processing revenue, including payments and PSQ Impact;
- $2.1 million from loan and lease contracts sold, net;
- $900,000 in lease merchandise revenue;
- $800,000 in interest income on loans; and
- $700,000 in direct revenue.
Total operating expenses, including general and administrative, sales and marketing, and research and development expenses, declined by $2 million, or 18%, year over year. Wenzel attributed the decline to structural cost actions, including headcount reductions, the wind down of PublicSquare and tighter controls on contractor and consulting spending.
General and administrative expenses declined $1.6 million, or 20%, while research and development expenses fell $400,000, or 39%. Wenzel said both decreases were primarily driven by lower share-based compensation, which declined by $1.7 million in total. Sales and marketing expense increased modestly by $100,000 as the company shifted from paid acquisition toward expansion with existing merchants.
Operating loss improved to $6.1 million from $9.3 million a year earlier, a $3.2 million, or 34%, improvement. On a non-GAAP segment basis, excluding share-based compensation, depreciation and amortization, and unallocated corporate costs, operating loss improved 70% to $900,000 from $2.8 million.
Wenzel said reported net loss was $6.5 million, compared with $4.4 million in the first quarter of 2025, but noted that the year-over-year increase was “almost entirely” attributable to non-cash changes in the fair value of warrant and earn-out liabilities. She said the company recognized about $700,000 in non-cash gains from those fair value changes in the first quarter of 2026, compared with roughly $7.8 million in the prior-year period.
Payments and Credit Platforms Expand
Chief Financial Officer Michael Pena said payments gross merchandise volume reached $186.2 million in the quarter, compared with $36 million in the first quarter of 2025, an increase of 417%. He said the increase reflected sustained merchant onboarding, deeper engagement with existing relationships and the full-period contribution from agreements signed in the second half of last year.
Credit GMV was $15.1 million, up 32% year over year. Wunderlich and Pena both noted that the growth came despite continued softness in the broader firearms market. Pena said the improvement was driven by better conversion, higher approval rates and re-engagement of the company’s existing borrower base, rather than market tailwinds.
Wunderlich said payments remain the company’s fastest-growing revenue driver, and that industries beyond its core firearms-related category are seeking payment offerings in response to what he described as politically motivated debanking and deplatforming pressure.
The company’s giving product, previously referred to as Impact, is a specialized part of the payment stack serving nonprofits and political campaigns. Wunderlich said PSQ is seeing inbound interest from organizations facing deplatforming pressure elsewhere, but described the rollout as a “deliberate measured ramp.”
Cost Cuts and AI Adoption Drive Efficiency Focus
Management repeatedly emphasized revenue per employee as a key internal metric. Pena said PSQ ended the quarter with 47 full-time employees, down from 68 a year earlier. With revenue rising sharply over the same period, revenue per employee increased to $173,583 from $44,864, a 287% improvement.
Wunderlich said the company reduced staff by 41% from September 2025 to March 2026, wound down the marketplace segment and cut contractor and consulting expenses. He said those actions are expected to generate approximately $8 million in annualized cash savings.
Wunderlich also said artificial intelligence is helping the company operate with a smaller team. He said PSQ has expanded the use of machine learning and AI across underwriting, engineering, financial operations and risk monitoring, after first deploying machine learning in Cordova’s underwriting in 2021.
“AI continues to be a force multiplier,” Wunderlich said, adding that the company believes it can grow revenue without a corresponding increase in headcount.
Cash Burn Improves; Brand Sale Process Continues
Pena said operating cash burn was $4.1 million in the first quarter, compared with $6.4 million in the prior-year period, a 36% improvement. He said about $1.2 million of the first-quarter cash burn related to non-recurring items, including approximately $315,000 of severance tied to restructuring actions, as well as higher legal and accounting costs associated with the company’s annual report and audit.
Adjusted for those one-time payments, Pena said underlying operating cash burn was approximately $2.9 million for the quarter, which the company expects to continue working down through the year.
PSQ ended the quarter with $11.8 million in cash, restricted cash and cash equivalents, including $10.1 million of unrestricted cash. Net working capital was $11.2 million. Pena said the company had $7.4 million outstanding on its $10 million revolving line of credit as of March 31, and the facility was extended in March 2026 through July 31, 2027.
Pena said the company believes existing cash, together with anticipated proceeds from the planned sale of its brand segment, will be sufficient to fund operating and capital needs for at least the next 12 months. The company also has access to an at-the-market offering program.
Wunderlich said PSQ continues to actively pursue the sale of its brand segment and hopes to enter into a definitive agreement in the first half of 2026. He said operational changes in that segment, including team reductions, renegotiated third-party logistics arrangements and changes to sales and marketing, have produced cost savings that management believes will benefit the eventual buyer.
Management Discusses Stablecoins and Long-Term Strategy
During the question-and-answer portion of the call, Maxim Group analyst Thomas Forte asked about agentic commerce and stablecoins. Wunderlich said payments are likely to be central to agentic commerce, particularly as companies seek ways for agents to move money safely on behalf of users.
On stablecoins, Wunderlich said he believes they are “the payment rails of the future” and could reduce costs for merchants by compressing existing payment infrastructure. He said PSQ sees an opportunity in industries that have historically been misunderstood by traditional payment rails.
Responding to submitted shareholder questions, Wunderlich said management’s focus is on disciplined execution, revenue growth and reaching cash flow positivity over time. Asked whether PSQ’s credit strategy resembles Klarna, Sezzle or Affirm, Wunderlich said the company more closely resembles Block in its effort to own the payments stack with merchants through traditional payment processing and consumer credit.
“Our priorities are unchanged,” Wunderlich said. “Grow revenue with discipline, reduce cash burn, and drive towards profitability.”
About PSQ (NYSE:PSQH)
PSQ Holdings, Inc, together with its subsidiaries, operates an online marketplace through advertising and eCommerce in the United States. It operates through two segments, Marketplace and Brands segments. The PSQ platform is accessible through its mobile application and website. The company also sells diapers and wipes to mothers online under the EveryLife brand name. PSQ Holdings, Inc is headquartered in West Palm Beach, Florida.
