CUCKOO International (MAL) Berhad (“CUCKOO Malaysia” or the “Company”, KLSE:5336), a Healthy Home Creator, today announced its unaudited financial results for the first quarter ended 31 March 2026 (“Q1FY2026”). Despite a softer sales environment, the Company delivered stable profitability, supported by stronger gross margins, lower operating costs and continued focus on disciplined execution.
For Q1FY2026, the Company recorded revenue of RM227.8 million and profit after tax (“PAT”) of RM25.0 million, while profit before tax (“PBT”) stood at RM33.7 million. On a year-on-year (“YoY”) basis, revenue moderated from the corresponding quarter, reflecting softer consumer demand and lower units sold.
Gross profit (“GP”) for the quarter was RM87.2 million, while gross margin improved to 38.3% YoY (up from 31.0% in Q1FY2025), attributed to lower product costs on the back of a stronger Malaysian Ringgit, as well as lower average customer acquisition costs. Distribution and administrative expenses declined to RM18.0 million and RM15.7 million respectively, representing a YoY reduction of 7.3% and 14.5% respectively. This is mainly due to lower marketing expenditure and staff costs following more focused marketing spending and streamlined processes.
Net losses on impairment of financial instruments increased to RM18.5 million during the quarter, which the Company attributed to a slower repayment pattern as consumers prioritised spending around festive periods. Meanwhile, net finance costs decreased to RM1.9 million, supported by lower interest expense from reduced borrowings and higher foreign exchange gains amid a stronger Malaysian Ringgit.
Mr. Hoe Kian Choon (KC Hoe), CUCKOO Malaysia’s Non-Independent Executive Director and Chief Executive Officer said, “In Q1FY2026, we remained focused on disciplined execution and cost efficiency, which helped us sustain profitability amid a more measured consumer spending environment. Encouragingly, our gross margin strengthened during the quarter, supported by lower product costs and lower customer acquisition costs. As we continue expanding our ecosystem of wellness solutions and strengthening our omni-channel distribution presence, we remain committed to enhancing earnings quality and delivering sustainable value over the longer term.”
On the balance sheet, cash and cash equivalents stood at RM70.5 million as at 31 March 2026, while total borrowings were reduced to RM118.6 million. Equity attributable to owners of the Company increased to RM1.1 billion, reflecting sustained profitability and balance sheet resilience.
Moving forward, while consumer spending remains cautious amid elevated living costs and a softer overall operating environment, the Company remains focused on delivering long-term, sustainable value by staying disciplined in execution and responsive to evolving consumer needs. The Company’s continued priorities include maintaining affordability, accessibility and service quality, while reinforcing the strength of its recurring revenue model.
On the customers’ front, the Company remains focused on steadily expanding its market presence by leveraging its strong brand, effective business model, and omni-channel distribution network. Strategic priorities include expanding product SKUs across its business segments to cater to broader customer segments, as well as strengthening its distribution presence in Malaysia across its channels, including online platforms, physical outlets and its workforce. This extends the Company’s efforts from Q1FY2026, through the introduction of new SKUs under the CUCKOO Smart Healthy Home Co-Created Programme, its digital acceleration efforts with integration of product rental options through the CUCKOO e-Brandshop to capture the digital-first segment, and a strengthened retail presence with a cumulative of three cash-and-carry Brandshops on top of its existing over 230 retail outlets. The Company is also positioned to penetrate the HORECA sector with its appointment as a Strategic Partner for Visit Malaysia 2026 (VM2026).
Looking ahead, CUCKOO Malaysia remains cautiously optimistic. With consumers increasingly favouring rental arrangements as an alternative to outright purchases, the Company is well-positioned to capitalise on this trend. Through continued investment in technology and wellness-focused home living solutions, including home appliances and household goods, home care services and other lifestyle solutions, the Company is committed to sustain growth and build a resilient foundation for future growth.
