Custombilt Firearms Manufacturing LLC has filed for Chapter 11 bankruptcy protection in Kansas City, citing a contentious dispute with the Bureau of Alcohol, Tobacco, Firearms, and Explosives over its federal firearms license. The Overland Park-based gunmaker, which produces AR9s, AR15s, and AR10s, listed $100,000 to $500,000 in assets against $1 million to $10 million in liabilities when filing its petition on February 6, 2026.

The bankruptcy filing follows a prolonged legal battle with the ATF, which revoked Custombilt's dealer license in July 2023 for allegedly failing to comply with federal firearms regulations. The company unsuccessfully challenged the revocation in federal court, with its amended complaint dismissed without prejudice in April 2024. This regulatory action appears to have significantly impacted the company's ability to operate its core firearms business.

Custombilt's financial troubles mirror broader industry challenges, as firearms sales declined 4.1% in 2025 to approximately 14.6 million units from over 15.2 million in 2024. The company's website currently shows no rifles or pistols available for sale, though it continues to offer parts and branded apparel. With five listed dealers including its own Bullet Hole location, Custombilt's bankruptcy highlights the mounting pressures facing firearms manufacturers amid regulatory scrutiny and softening consumer demand.

Quick Fact: Custombilt's ATF license was revoked on July 6, 2023, for alleged non-compliance with federal firearms regulations.