Fiscal 2025

• Sales of $61.0 million, supported by store-led omnichannel growth
• Comparable store sales growth of 6.8%, reflecting continued consumer demand for premium tea
• Net income of $2.9 million, a $6.1 million improvement over prior year
• Adjusted EBITDA nearly doubled to $7.6 million, up $3.7 million year-over-year

Q4 2025

• Sales of $23.5 million, with brick-and-mortar revenue up 11.9%
• Net income of $5.3 million, a $2.8 million improvement over the prior year quarter
• Adjusted EBITDA of $5.4 million, up $1.4 million – representing the strongest quarter of the year

Montreal, Quebec--(Newsfile Corp. - April 29, 2026) - DAVIDsTEA Inc. (TSXV: DTEA) ("DAVIDsTEA" or the "Company"), a leading tea merchant in North America, announced today its fourth quarter and full-year results for the period ended January 31, 2026 ("Fiscal 2025").

"Fiscal 2025 results reflect a fundamental reset in our business with a return to full-year profitability on an IFRS basis driven by disciplined execution, leaner cost structure, stronger margins, and a retail store-led omnichannel model that is performing as intended," said Sarah Segal, Chief Executive Officer and Chief Brand Officer of DAVIDsTEA.

"Our strategy is clear: retail is the growth engine. Each new store builds brand awareness in its respective market and drives e-commerce and wholesale channel sales along with a compounding effect as our footprint grows. Supported by strong category tailwinds, including wellness trends and the rise of the demand and interest in the matcha category, we are well positioned to begin scaling that opportunity in fiscal 2026. Our expansion plan should accelerate momentum through new store openings slated for Oshawa and Mississauga in Ontario, combined with our return to Edmonton and Vancouver, raising our store count to 25 by the year end."

"Fiscal 2025 highlights a meaningful improvement in our underlying business model, with net income of $2.9 million, working capital of $17.7 million, and cash of $16.5 million, even as we continued to invest in growth," said Frank Zitella, President and Chief Financial and Operating Officer of DAVIDsTEA.

"Structural cost savings from our IT platform transition are now fully realized with SG&A expenses lowered by more than $4 million year-over-year. In addition, we recently signed a lease agreement that will reduce our operational footprint from two to one building in Montreal. This 160,000 square foot facility will be supplemented by a third-party logistics partner in Chicago to mitigate the elimination of the de minimis trade exemption on goods under US$800 shipped to the U.S. Given that infrastructure expenses and our cost base are largely fixed, incremental revenue from our omnichannel growth strategy will flow through our P&L at higher margins, creating meaningful operating leverage as we scale in 2026. These latest initiatives position us to generate sustained profitability, supported by disciplined expansion and a strong real estate pipeline."

Operating Results for the Fourth Quarter of Fiscal 2025

Three Months Ended January 31, 2026 compared to Three Months Ended February 1, 2025

Sales. Sales for the fourth quarter of Fiscal 2025 increased $0.3 million, or 1.2%, to $23.5 million compared to the prior year quarter. The modest top-line growth masks meaningfully different dynamics across geographies and channels, with strong Canadian performance and brick-and-mortar recovery partially offset by continued U.S. softness and a moderation in online revenues.

Sales in Canada of $20.8 million, representing 88.4% of total revenue, increased $1.2 million or 6.1% compared to the same quarter last year, reflecting healthy domestic demand across both our retail stores and online platform during the holiday season.

U.S. sales of $2.7 million decreased $0.9 million or 25.2% compared to the prior year quarter, driven primarily by U.S.-Canada trade tensions and tariff-related headwinds on our cross-border e-commerce channel. In response, and in light of ongoing uncertainty surrounding the U.S. de minimis import rule, the Company took decisive action by commencing fulfillment of U.S. orders from a third-party logistics partner in Chicago on March 26, 2026. Shipping from within the United States is expected to meaningfully improve the customer experience, and support a recovery in U.S. sales in Fiscal 2026.

Tea and variety box assortment sales, which represent the core of our holiday offering, increased 2.2% or $0.5 million to $20.9 million, reflecting the continued strength of our seasonal product collections. Tea accessories sales were $2.2 million, essentially flat with the prior year quarter.

Online sales of $11.8 million decreased $0.6 million or 4.7% from $12.4 million in the prior year quarter, representing 50.2% of total sales compared to 53.3% in Q4 Fiscal 2024. The moderation reflects the impact of U.S. tariff headwinds on cross-border shipments, partially offset by domestic online demand during the holiday period.

Brick-and-mortar sales of $9.6 million increased $1.0 million or 11.9% from $8.6 million in the prior year quarter, representing 40.9% of sales compared to 36.9% in Q4 Fiscal 2024. Comparable store sales increased from $8.3million in the prior year quarter to $8.8 million in the current quarter, a comparable sales growth of 6.6%. The channel mix shift reflects the continued recovery of in-store holiday shopping behaviour, the contribution of two new store openings in Quebec in Fiscal 2024, and the opening of a new store in Laurier, Québec City in December 2025 — the first new store of Fiscal 2025.

The Laurier opening marks the beginning of a more ambitious chapter for the Company. DAVIDsTEA's store-led growth strategy is built on a straightforward premise: that returning to the communities we once served will drive growth across all channels — in-store, online, and wholesale. New stores generate strong unit economics, create brand visibility, and produce a measurable spillover effect on digital and wholesale revenues.

In November 2025, the Company completed a $3.0 million private placement specifically to fund the opening of five new stores. With Laurier now open and four additional locations in active planning, the Company enters Fiscal 2026 with both the capital and the conviction to execute.

Sales from the wholesale channel of $2.1 million decreased $0.2 million or 7.6% from $2.3 million in the prior year quarter, representing 8.9% of sales compared to 9.8% in Q4 Fiscal 2024. The decline reflects the timing of wholesale replenishment orders, as the initial stocking associated with the Couche-Tard convenience store expansion was substantially completed in Fiscal 2024.

Gross profit. Gross profit increased 9.2% to $13.9 million from $12.7 million in the prior year quarter. Gross profit as a percentage of sales expanded to 58.9% from 54.6% in Q4 Fiscal 2024, the strongest quarterly margin rate in the Company's recent history. The improvement was driven by three factors: a higher proportion of full-margin product sales within the holiday assortment, a reduction in unitized freight and inbound shipping costs, and lower fulfillment costs per order. Gross margin in the fourth quarter is structurally higher than the Company's other fiscal quarters, reflecting the concentration of higher-margin seasonal gift sets, variety boxes and holiday collections in the sales mix during the peak period.

Selling, general and administration expenses. SG&A of $8.5 million decreased $0.4 million or 4.4% compared to the prior year quarter, and as a percentage of sales declined to 36.2% from 38.3%. The reduction was primarily driven by a decrease in marketing expenses of $0.8 million, reflecting a more targeted and efficient approach to holiday season customer acquisition. Partially offsetting this decrease were increases in wages, salaries and employee benefits of $0.5 million, reflecting annual compensation adjustments and the staffing requirements of an expanded retail footprint, and professional and consulting fees of $0.2 million associated with the Company's financing activities during the period.

EBITDA, Adjusted EBITDA and Adjusted EBITDAR (1). EBITDA was $5.4 million in the quarter compared to $3.8 million in the prior year quarter. Adjusted EBITDA was $5.4 million or 23.1% of sales, compared to $4.0 million or 17.3% of sales in Q4 Fiscal 2024, an improvement of $1.4 million. Adjusted EBITDAR was $4.2 million compared to $2.8 million in the prior year quarter. The $1.4 million increase in Adjusted EBITDAR reflects the combination of gross margin expansion driven by improved product mix and lower input costs, and modest SG&A efficiencies, demonstrating the operating leverage available to the business when the holiday quarter performs.

Net income and Adjusted net income. Net income was $5.3 million in the quarter compared to net income of $2.5 million in the prior year quarter, an improvement of $2.8 million or 111%. Adjusted net income was $4.0 million compared to Adjusted net income of $2.7 million in Q4 Fiscal 2024. The strong quarterly net income performance reflects the flow-through of gross margin expansion and cost discipline which contributed to the Company's positive full-year net income result.

Fully diluted net income per share. Fully diluted net income per common share amounted to $0.17 in the fourth quarter compared to $0.09 in the prior year quarter. Adjusted fully diluted net income per common share was $0.13 compared to $0.10 in the prior year quarter.

Cash on hand. The Company ended the fourth quarter of Fiscal 2025 with cash of $16.5 million, compared to $16.2 million at the end of Fiscal 2024, reflecting strong seasonal cash generation from the holiday quarter and the proceeds of capital raised during the year. Free cash flow for the quarter was $8.0 million, compared to $9.4 million in Q4 Fiscal 2024, with the year-over-year decrease reflecting an intentional inventory build as the Company positions itself for a return to revenue growth. The fourth quarter's free cash flow substantially offset cash consumed in the first three quarters of the year, as is typical of the Company's seasonal working capital cycle

Operating Results for the Fiscal Year Ended January 31, 2026 compared to the Fiscal Year Ended February 1, 2025

Sales. Sales for Fiscal 2025 decreased $0.8 million, or 1.3%, to $61.0 million. Sales in Canada of $53.8 million, representing 88.2% of total revenues, increased $0.8 million or 1.5% over the prior year, reflecting continued domestic demand across retail and online channels. U.S. sales of $7.2 million decreased by $1.6 million, or 18.4%, from the prior year, driven by the impact of escalating U.S.-Canada trade tensions and tariff-related headwinds on our cross-border e-commerce channel. In response, the Company commenced fulfillment of U.S. orders from a third-party logistics partner in Chicago on March 26, 2026. Shipping from within the United States is expected to improve the delivery experience for U.S. customers, reduce cross-border friction, and support a recovery in U.S. sales in Fiscal 2026.

Tea and variety box assortment sales decreased 2.1% or $1.1 million to $54.1 million, reflecting the softness in U.S. cross-border volumes. Tea accessories sales increased 3.9% or $0.2 million to $5.3 million over the prior year.

Online sales of $28.6 million decreased $2.4 million or 7.6% from $31.0 million in the prior year, representing 46.9% of sales compared to 50.1% in the prior year. The decline was driven primarily by reduced U.S. cross-border volumes resulting from tariff headwinds, partially offset by domestic online demand.

Brick-and-mortar sales of $24.3 million increased $2.3 million or 10.4% from $22.0 million in the prior year, representing 39.8% of sales compared to 35.6% in the prior year. Comparable store sales increased from $20.8 million in the previous year to $22.3 million in the current year, a comparable sales growth of 6.8%, on top of a 6.3% increase over Fiscal 2023. The growth reflects the continued recovery of in-store shopping behaviour and the contribution of three new store openings in Québec, Canada, two located in Montreal in Fiscal 2024 and a third in Laurier, Québec City in December 2025, the first new store of Fiscal 2025 and an important step in the Company's store-led growth strategy.

The performance of our retail channel reinforces the Company's conviction in its store-led growth plan. New stores generate strong unit economics, create brand visibility in the communities we serve, and produce a measurable spillover effect on online and wholesale revenues.

(1) Please refer to "Use of Non-IFRS Financial Measures" in this press release.

In November 2025, the Company completed a $3.0 million private placement to fund the opening of five new stores. With Laurier now open and four additional locations in active planning, the Company enters Fiscal 2026 with the capital, the strategy, and the operational foundation to drive a return to revenue growth — and to build on the profitability demonstrated in Fiscal 2025.

Sales from the wholesale channel of $8.1 million decreased $0.7 million or 8.4% from $8.8 million in the prior year, representing 13.2% of sales compared to 14.3% in the prior year. The decline reflects the timing of wholesale replenishment orders, as the initial stocking associated with the Couche-Tard convenience store expansion was substantially completed in Fiscal 2024.

Gross profit. Gross profit increased 5.1% to $35.7 million from the prior year, despite the modest top-line decline. Gross profit as a percentage of sales expanded to 58.6% from 55.0% in the prior year, driven by improved product mix, a reduction in unitized freight and inbound shipping costs, and lower fulfillment costs per order, the direct result of the Company's internalized fulfillment model operating at full efficiency for its first complete fiscal year.

Selling, general and administration expenses. SG&A of $28.8 million decreased $4.8 million or 14.2% compared to the prior year. The primary driver was a $3.8 million reduction in IT expenses, which included the absence of a $3.1 million one-time charge incurred in Fiscal 2024 in connection with the termination of legacy IT contracts, as well as the ongoing savings from the Company's re-platformed technology infrastructure. Marketing expenses decreased $0.5 million, reflecting a more disciplined approach to customer acquisition spend. Partially offsetting these savings were increases in wages, salaries and employee benefits of $1.4 million, reflecting annual compensation adjustments and the staffing requirements of a growing retail footprint, and professional and consulting fees of $0.2 million associated with the Company's financing activities. Note that Fiscal 2024 SG&A also included a reversal of impairment of property and equipment and intangible assets of $1.4 million, which does not recur in Fiscal 2025. As a percentage of sales, SG&A decreased to 47.2% in Fiscal 2025 from 54.3% in the prior year.

EBITDA, Adjusted EBITDA and Adjusted EBITDAR (1). EBITDA was $6.9 million in Fiscal 2025 compared to $0.4 million in the prior year — a $6.5 million improvement. Adjusted EBITDA was $7.6 million or 12.4% of sales, compared to $3.9 million or 6.3% in the prior year, approaching the low double-digit Adjusted EBITDA margin the Company has been targeting. Adjusted EBITDAR was $2.8 million compared to $0.1 million in the prior year. The year-over-year improvement reflects the combined impact of gross margin expansion and the significant reduction in ongoing SG&A expenses, demonstrating that the cost structure established through the Company's operational restructuring is now generating meaningful earnings leverage on a sustained basis.

Net income (loss) and Adjusted net income. Net income was $2.9 million in Fiscal 2025 compared to a net loss of $3.2 million in the prior year, the Company's first positive full-year net income result in recent years and a $6.1 million improvement year-over-year. Adjusted net income was $1.8 million compared to $0.1 million in the prior year.

Fully diluted net income (loss) per share. Fully diluted net income per common share was $0.10 in Fiscal 2025 compared to a fully diluted net loss per share of $0.12 in Fiscal 2024. Adjusted fully diluted net income per common share, which is Adjusted net income on a fully diluted weighted average shares outstanding basis, was $0.06 compared to $nil in the prior year.

Liquidity and Capital Resources

As at January 31, 2026, the Company held cash of $16.5 million, compared to $16.2 million at the end of Fiscal 2024. The year-end cash position remained essentially unchanged year-over-year, as the proceeds of a $3.0 million private placement and strong seasonal cash generation in the fourth quarter together with net proceeds of $1.1 million from a revenue-linked financing arrangement, offset cash deployed into a meaningful inventory build ahead of the peak selling season, a reduction in trade and other payables, and the opening of a new store under the Company's store-led growth strategy — a reflection of the improving quality of the underlying business.

Working capital was $17.7 million as at January 31, 2026, compared to $12.8 million as at February 1, 2025, an improvement of $4.9 million or 38%. The increase reflects stronger underlying operating performance during the year and the proceeds of the private placement, partially offset by a $3.5 million reduction in trade and other payables, primarily reflecting the timing of supplier payments relative to year-end, and a decrease in prepaid expenses and deposits.

DAVIDsTEA's primary source of liquidity is cash on hand and cash flow generated from operations. Working capital requirements fluctuate during the year, rising in the second and third fiscal quarters as the Company takes title to increasing quantities of inventory in anticipation of our peak selling season in the fourth fiscal quarter.

(1) Please refer to "Use of Non-IFRS Financial Measures" in this press release.

During Fiscal 2025, the Company drew on a revenue-linked financing arrangement to support working capital requirements heading into the fourth quarter. The Company received advance funding of $2.7 million, of which $1.1 million remained outstanding at January 31, 2026. Under the terms of the arrangement, the Company remits 7% of revenues generated through its retail and e-commerce channels until a fixed repayment amount of $2.9 million has been satisfied, representing the $2.7 million advance plus a fixed financing cost of 8.0%. The outstanding balance is expected to be discharged through normal course revenue remittances in Fiscal 2026.

On November 19, 2025, the Company completed a private placement to fuel its store-led growth strategy, raising gross proceeds of $3.0 million through the issuance of 3,333,334 Units at a price of $0.90 per unit. The first use of this capital was the opening of a new store in Laurier, Québec City in December 2025, the Company's first new store of Fiscal 2025 and a tangible step in its plan to return to the communities it once served, with four additional store openings in active planning for Fiscal 2026. Each Unit consists of one common share and one-half of a common share purchase warrant. Each full warrant entitles its holder to purchase one additional common share at a price of $1.25 for one year from the closing date and at $1.50 for one year thereafter. The warrants represent a source of additional capital that the Company may draw upon as its store opening program advances, providing optionality to accelerate the growth plan should the opportunity arise. In the event that the closing price of the Company's common shares on the TSX Venture Exchange is at least $2.00 for not less than 20 consecutive trading days following the date that is four months and one day from closing, the warrants will expire at the sole discretion of the Company on the 30th day after notice is provided to holders. No commissions or other fees were paid in connection with the private placement. The shares and warrants issued are subject to a four-month resale restriction period that ended March 20, 2026.

Capital expenditures amounted to $0.7 million in Fiscal 2025 (Fiscal 2024 - $1.6 million), comprised of $0.6 million in leasehold improvements, $0.1 million in furniture and equipment, and $0.2 million in computer hardware and software, net of a tenant inducement of $0.2 million. Capital expenditures in Fiscal 2026 are expected to increase as the Company executes against its store opening program, with leasehold improvements representing the primary component of planned investment.

As at January 31, 2026, purchase obligations amounting to $6.5 million, net of advances of $0.4 million included in prepaid expenses and deposits (Fiscal 2024 - $7.4 million, net of $0.5 million of advances), are expected to be discharged within 12 months. Commitments also include variable payments under certain IT service contracts with minimum committed amounts of $0.1 million for Fiscal 2027.

Subsequent to year-end, the Company commenced fulfillment of U.S. orders from a third-party logistics partner in Chicago on March 26, 2026. This operational initiative is expected to improve the delivery experience for U.S. customers and support a recovery in U.S. sales in Fiscal 2026, with no material incremental capital commitment required.

Management enters Fiscal 2026 with confidence. The Company has delivered its first positive full-year net income in recent years, established a cost structure capable of generating sustained profitability, and raised the capital required to execute its store-led growth plan. With four new stores in planning, a strengthened U.S. fulfillment model, and warrant proceeds available as an additional source of capital should the growth plan require it, the business is well-positioned to build on the progress of Fiscal 2025. Management remains focused on disciplined execution and on delivering value for all shareholders.

Condensed Consolidated Financial Data
(Canadian dollars, in thousands, except per share information)

(1) Please refer to "Use of Non-IFRS Financial Measures" in this press release.

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¹ Please refer to "Use of Non-IFRS Financial Measures" in this press release.

Use of Non-IFRS Financial Measures
This press release includes "non-IFRS financial measures" defined as including: 1) EBITDA, EBITDAR, Adjusted EBITDA and Adjusted EBITDAR, 2) Adjusted net income (loss), and 3) Adjusted fully diluted income (loss) per common share. These non-IFRS financial measures are not defined by or in accordance with IFRS and may differ from similar measures reported by other companies. We believe that these non-IFRS financial measures provide knowledgeable investors with useful information with respect to our historical operations. We present these non-IFRS financial measures as supplemental performance measures because we believe they facilitate a comparative assessment of our operating performance relative to our performance based on our results under IFRS, while isolating the effects of some items that vary from period-to-period but not in substitution to IFRS financial measures.

Please refer to the non-IFRS financial measures section in the Company's Management Discussion and Analysis for a reconciliation to IFRS financial measures.

Note
This release should be read in conjunction with the Company's Management Discussion and Analysis, which is filed by the Company with the Canadian securities regulatory authorities on SEDAR+ at www.sedarplus.ca and will also be available in the Investor Relations section of the Company's website at www.davidstea.com.

Caution Regarding Forward-Looking Statements
This press release includes statements that express our opinions, expectations, beliefs, plans or assumptions regarding future events or future results and there are, or may be deemed to be, "forward-looking statements" within the meaning of applicable Canadian securities law. These forward-looking statements can generally be identified by the use of forward-looking terminology, including the terms "believes", "expects", "may", "will", "should", "approximately", "intends", "plans", "estimates" or "anticipates" or, in each case, their negatives or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts and include statements regarding our intentions, beliefs or current expectations concerning, among other things, our strategy of transitioning to e-commerce and wholesale sales, future sales through our e-commerce and wholesale channels, and our results of operations, financial condition, liquidity and prospects.

While we believe these opinions and expectations are based on reasonable assumptions, such forward-looking statements are inherently subject to risks, uncertainties and assumptions about us, including the risk factors discussed in Management Discussion and Analysis of Financial Condition and Results of Operations for our fiscal year ended January 31, 2026, filed with the Autorité des marchés financiers, on April 29, 2026.

Conference Call Information
A conference call to discuss the fourth quarter and full-year Fiscal 2025 financial results is scheduled for April 29, 2026, at 8:30 am Eastern Time. The conference call will be webcast and may be accessed via the Investor Relations section of the Company's website at ir.davidstea.com. An online archive of the webcast will be available within two hours of the conclusion of the call and will remain available for one year.

About DAVIDsTEA
DAVIDsTEA offers a specialty branded selection of high-quality proprietary loose-leaf teas, pre-packaged teas, tea sachets, tea-related accessories and gifts through its e-commerce platform at www.davidstea.com  and the Amazon Marketplace, its wholesale customers which include over 4,000 grocery stores and pharmacies, over 1,500 convenience stores in Canada and over 900 grocery stores in the United States, as well as 21 company-owned stores across Canada. It offers primarily proprietary tea blends that are exclusive to the Company, as well as traditional single-origin teas and herbs. The team's passion for and knowledge of tea permeates the Company's culture and is rooted in an excitement to explore the taste, health and lifestyle elements of tea. With a focus on innovative flavours, wellness-driven ingredients and organic tea, the Company launches seasonally driven "collections" with a mission of making tea fun and accessible to all. The Company is headquartered in Montréal, Canada.

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Source: DavidsTea Inc.