Laird Superfood, Inc. (LSF) Earnings Call Transcript & Summary

Thanks. Good afternoon, and welcome to the earnings conference call and webcast for Laird Superfood covering the fourth quarter and full year 2025. Joining us today are Jason Vieth, who serves as President and Chief Executive Officer of Laird Superfood, and Anya Hamill, our Chief Financial Officer. Everyone ought to have the earnings release by this point, which the company filed today following the market close. You can find it in the investor relations portion of Laird Superfood's site, www.lairdsuperfood.com. Before we get started, please be aware that management might make forward-looking statements on this call under federal securities laws. Such statements reflect management's present expectations and carry risks and uncertainties that may lead actual results to differ materially from what has been described. For a detailed discussion of those risks and uncertainties, please see today's press release along with other SEC filings. With that said, I'll hand things over to Jason.

Good afternoon, everyone, and thanks for being with us today. I'm Jason Vieth, Laird Superfood's CEO, and our CFO Anya Hamill is here alongside me; we're grateful you're spending the time as we go through the first quarter and full year 2025 results, which came out earlier today. Fiscal 2025 proved pivotal and transformative for Laird Superfood. Net sales reached a record $49.9 million, a 15% increase over the prior year and consistent with the revised guidance we gave; net sales in the fourth quarter by themselves climbed 15%, hitting $13.3 million. That growth showed up broadly and was particularly powerful in wholesale, which jumped more than 40% both in Q4 and across the full year; the momentum stemmed from significant distribution expansion combined with sustained strong velocities in grocery and club outlets. Retail consumption data through the latest quad-week ending February 22, 2026, confirms how healthy that wholesale acceleration is. Within measured natural and MULO channels, coffee turned in the strongest full year performance among all Laird Superfood product groups, +45% dollar growth on +18% TDP growth across the last 52 weeks. Shelf-stable creamers produced +15% dollar growth for the year, holding the biggest share of our portfolio at 28%. I'm also glad to share that our refrigerated creamers relaunched very successfully during late Q4 into early Q1, including a reformulation to what we believe stands as the cleanest and best-tasting liquid creamer product on the market. Beyond that, we repositioned our creamer as an extended shelf life refrigerated item bottled in post-consumer recycled plastic; our view is that moving to a cleaner formula and an already recycled bottle strengthens how we're positioned with retailers and consumers alike. Following a difficult 2025 for this product, strong momentum is already visible in the latest four weeks, up 7% in the natural channel compared with the same stretch a year ago. Let me be clear that none of this happened by accident; it directly proves that our strategy to win in coffee solutions, covering coffee, creamers, and lattes, is delivering. Consumers are embracing our full ecosystem of functional better-for-you coffee and coffee companions, and that's converting into outsized velocity and distribution gains in our core categories. E-commerce held up resiliently at roughly half of total sales in Q4. Weakness on our direct-to-consumer platform was partly offset by robust continued growth on amazon.com, which further underscores the strength of our coffee solutions portfolio with the everyday convenience shopper. While we value the core set of consumers who visit our DTC site to explore and buy our Laird Superfood products, we hold no illusion that Amazon won't keep winning online volume going forward; that's why we'll keep using Amazon as the growth engine for our e-commerce sales. I also want to offer heartfelt recognition to the whole Laird team for the exceptional job they did steering through the chaos of sharp commodity inflation, fresh tariff pressures, and persistent supply chain volatility. During 2025, the team moved early to lock in strategic inventory before tariffs went up, added safety stock so service levels stayed protected and shelves didn't go empty, and kept a tight grip on operational discipline in procurement, logistics, and cost control. That kind of foresight and ability to stay agile when things get tough is precisely what let us post top line growth while operations kept humming along, and I feel immense pride in the way this team performed day in and day out. Turning now to the other major development we've discussed over the past few months. Only 14 days ago, on March 12, we completed our purchase of Navitas Organics, paid for with the $50 million investment we finished alongside Nexus Capital. This deal fits our strategy to a tee and marks a significant stride toward our vision of a scaled superfood platform. Navitas delivers to Laird Superfood a premium, purpose-driven brand boasting over 20 years of history, $45.3 million in 2025 net sales, and a 31.8% gross margin; it brings complementary products, stronger reach in conventional grocery and club channels, new customers, and greater geographic diversity. Combined, Laird and Navitas immediately become a bigger, more diversified platform with enhanced scale, cross-selling opportunities, and supply chain efficiencies we anticipate will fuel both revenue growth and profit expansion in the years ahead. The way this financing is structured speaks to our confidence in this path. Nexus put in $50 million upfront by purchasing Series A preferred stock. Notably, the investment agreement hands us the option to call another $60 million from Nexus at any point within 270 days following closing, or as many as 360 days if we're actively negotiating another strategic transaction. Those proceeds are designated for an acquisition or other growth initiatives, with whatever remains usable for general corporate purposes; this financial setup provides us enormous flexibility to pursue further opportunities whenever they emerge. Naturally, this investment did bring about significant dilution to our common equity. On an as-converted basis, Nexus' stake amounts to roughly 56.2% of the company as of today. We're being fully transparent regarding that dilution since it's being swapped for what we view as far more valuable, the immediate addition of a profit accretive business that we expect will bolster our overall earnings power and cash flow generation moving forward. Put simply, we expect to trade some ownership percentage now for a much larger, higher quality earnings stream later. We're truly thrilled about the prospect of further acquisitions as we build the country's leading superfood business. With the capital access Nexus provides and the integration playbook now in our hands, we see an obvious runway to keep consolidating in the superfood and functional food space. Our aim is to keep growing scale, widen our product portfolio, strengthen our retailer partnerships, and ultimately establish a category leader that produces sustainable, profitable growth for many years ahead. As we look forward, our priorities stay clear. Keep pushing wholesale growth forward, safeguard and grow our gross margins by way of Navitas synergies, and carry out an integration that goes off without a hitch, while remaining ready to seize additional M&A chances. Given a stronger balance sheet, a bigger platform, and a skilled merged workforce, my optimism regarding Laird Superfood's future has never been higher. Ahead of handing things to Anya for the thorough financial review, I want to express gratitude to each and every Laird teammate, our retail partners, our consumers, and now our new Navitas Organics colleagues. 2025 demonstrated that growth is possible amid turbulence, and 2026 will be the year we demonstrate what a genuinely scaled superfood platform is capable of. Anya, the floor is yours.

Jason, thanks, and good afternoon to all of you. I'll take you through additional details now about how we performed in Q4 and across fiscal 2025 as a whole. Jason mentioned that we closed out the year having achieved record net sales totaling $49.9 million, which came in 15% higher than the prior year, and Q4 net sales reached $13.3 million, also up 15% compared with last year. Let me build on those top-line numbers by providing the financial specifics underneath. The primary engine of our growth was the wholesale channel, which climbed 44% year-over-year in the fourth quarter to $7.0 million and represented 52% of total Q4 net sales; on a full-year basis, wholesale grew 41% to $24.9 million, comprising 50% of total net sales. The way our channel mix has changed is a direct result of the plan we set out for Laird Superfood — moving it toward becoming a business driven primarily by wholesale — and the figures show that we're delivering on that plan. On e-commerce, we brought in $6.4 million, which works out to 48% of Q4 net sales, and that represents a 6% drop compared with the same period a year earlier; weaker performance in our direct-to-consumer platform was partly made up for by ongoing gains on amazon.com. Looking at the whole year, e-commerce delivered $25.0 million, equal to 50% of net sales, which is 3% lower than 2024. Jason mentioned that within e-commerce, Amazon is where we're concentrating our growth efforts, and our DTC channel keeps gaining from a repeat customer base that is extremely loyal. When it came to gross margins, the fourth quarter came in at 34.1%, while the equivalent period a year before was 38.6%. The main reason for this pullback was higher costs on our products stemming from inflation in commodity markets, plus the lingering effect of tariffs—most of which have since been removed where our raw materials are concerned—along with settlement recoveries booked in fiscal 2024 that simply didn't show up again in 2025. Gross margin for the entire fiscal year came in at 37.9%, versus 40.9% during 2024. The factors behind that year-over-year drop mirror what we saw in Q4: pressure from commodities and tariffs, combined with the absence of the settlement gains we had a year earlier. Even with those challenges, our full-year gross margins landed in the upper 30% range, which is right in line with the expectations we had communicated. On the supply chain side, we keep finding ways to work more efficiently by partnering directly with the suppliers who provide our key raw materials as well as our co-packing partners, and we feel good about holding gross margins at levels that can compete with the best-in-class CPG companies. For fiscal year 2025, total operating expenses came in at $22.3 million, up from $19.9 million the year before, which mirrors the investments we planned in sales and marketing to fuel top line growth, partly offset by the discipline we've kept up on general and administrative costs. In the fourth quarter, net loss was $1.8 million, or $0.16 per diluted share, versus a net loss of $0.4 million, or $0.04 per diluted share, in the same period a year earlier. The main reason our loss grew compared to last year was $0.9 million in professional fees tied to buying Navitas, along with increased procurement costs related to commodities and tariffs. Looking at the full fiscal year 2025, our net loss came to $3.3 million, equal to $0.31 per diluted share. For 2024, the number was $1.8 million, or $0.18 per diluted share — so that's an increase of $1.5 million between the two years. Let me break down precisely what drove that. We had $0.9 million in fees connected to the Navitas acquisition, and on top of that, a $0.7 million impairment charge on Picky Bars intangible assets. Add those together and you get $1.6 million, which basically represents the whole swing in net loss between the two years. Once you strip out those two separate, non-recurring items, the net loss from our core operations came in essentially level compared with the prior year, and that held true even while we dealt with substantial commodity inflation and pressure from tariffs. That outcome is something we take pride in, and it speaks to the fundamental earnings momentum within our business. I'd also like to call attention to how our adjusted EBITDA performed, since I consider it a key gauge of the real progress we're making. Across the full fiscal year 2025, adjusted EBITDA came in positive at $0.3 million — a major step up from the $0.7 million loss recorded in 2024, and right in line with what we promised about reaching at least break-even adjusted EBITDA for the entire year. That amounts to a $1.0 million favorable swing compared with the prior year, and it shows the operating leverage starting to come through as our revenue grows. Switching over to the balance sheet now. We closed fiscal year 2025 holding $5.3 million in cash with zero debt. Accounts receivable climbed to $3.9 million, up from $1.8 million at the close of 2024, which mirrors the scheduling of sizable wholesale shipments late in 2025 that were then collected during the first quarter of 2026. Inventory finished the year at $7.8 million, a decline from the roughly $11 million peak reached in the second quarter of 2025 — in keeping with our plan to work down the forward purchases we'd made earlier in the year so we could lessen the effect of tariff-driven cost hikes. Operating activities consumed $2.8 million in cash during fiscal year 2025, versus $0.9 million that operations generated in 2024. The main reason for the change from one year to the next was how working capital moved — in particular, inventory accumulating over the first six months and the timing of wholesale receivables as the year closed. Because those receivables have now been converted to cash and inventory keeps returning to usual levels, we expect operating cash flow to improve as 2026 progresses. Turning to what we see ahead for 2026: at this point we're not providing formal, detailed guidance for fiscal year 2026, though I'd like to walk through our directional view of the combined business. To give everyone some background here: for fiscal year 2025, Navitas recorded $45.3 million in net sales, gross profit of $14.4 million — a gross margin of about 31.8% — and net income of roughly $1.6 million. Those numbers reflect historical standalone performance and don't appear in Laird Superfood's consolidated 2025 financial statements. Pair that with Laird Superfood's 2025 net sales of $49.9 million, and the combined revenue base we're beginning with is quite substantial. Looking ahead, for the combined business we're expecting net sales growth of at least high single digits% in 2026, and we anticipate adjusted EBITDA will rise, driven by top-line growth as well as integration synergies being realized across procurement, supply chain, and operations; we'll give specific full year 2026 guidance when we release our first quarter 2026 earnings, and we're eager to share more details then. With that, I'll turn things back over to Jason for any closing remarks.

Thanks, Anya. To wrap up, fiscal 2025 put our resilience to the test and confirmed how strongly we believe in what we're doing. We posted record revenue, built further momentum in wholesale, brought our refrigerated creamers back to market successfully, and—most significantly—made a transformative move forward by acquiring Navitas Organics and forming our partnership with Nexus Capital. We're no longer merely a promising coffee and creamer brand; today we stand as a scaled, diversified superfood platform, with wider reach, stronger capabilities, and an obvious path toward faster growth and margin expansion. What we've put in place, together with the skill and commitment of our merged teams, leaves us extremely well positioned for the road ahead. To those who hold our shares: thank you for continuing to believe in our vision. To our retail partners: your backing and collaboration have made a real difference. To the people who buy our products: your loyalty and excitement about better-for-you functional offerings motivate us daily. And to each person on the Laird and Navitas teams: thank you for the effort, imagination, and steadfast dedication you showed throughout a year of major transition; we head into 2026 carrying enormous momentum and optimism; what lies ahead is only the start of what we expect to be a multi-year effort to create North America's top superfood company. Thanks once more for being with us today. We're eager to share how we're progressing when we report first quarter 2026 results. Operator, we're ready to take questions now.

To start, what's the extent of overlap in retail doors when it comes to Laird items versus Navitas items? And has the typical number of items stocked gone up meaningfully?

Hi, Nicholas, Jason here. I heard the beginning of what you asked, but could you repeat the ending?

And the final piece of that was, have we seen a meaningful lift in the typical number of items stocked now that the portfolio is combined?

Yes. Understood. Yes, I'd say — to give the portfolio some shape, briefly. When it comes to Navitas, this is a company I think about; its size is quite close to that of Laird Superfood. Their wholesale channel exposure exceeds ours. As I see it, their online business isn't as big as what we have. There's a lot of overlap once you look at retailers comparable to their superfood. Natural channels are where they mainly operate. Their growth comes through the natural channel and the biggest channels across the entire business model. That's very much like the Laird Superfood portfolio that came out of the transaction. On the question of typical assortment, we generally are working on both brands. Both brands are being combined. I want to be really, really clear about that. Going forward, this is a play in which multiple brands will be run under the LSF ticker symbol, yet all of it will sit as a house of brands. At this point Navitas is just as important and just as big as Laird Superfood. It's a wonderful product portfolio. They do compete across different categories, yet the temperature state is also quite similar — shelf-stable items in bags or pouches that look very, very much like what our superfoods offer. Consolidating items doesn't really make sense here. What this actually is, as we look at both brands, is an expansion of items. The overlap is considerable, and the combined sales organization is working through that right now, which will truly let us reach the market in a way that lands harder. All of those retailers I brought up too, simply handing us more avenues — we're going to talk to retailers in a newer space, one we've long pointed to as the biggest opportunity ahead for us. Today we can walk in with two outstanding brands and truly take on a far more significant role with those retailers too; the assortment opportunities this opens up have us really excited, since one brand can be leveraged for the next. Those relationships matter enormously, and by using them across both brands, we anticipate some really strong distribution gains in the years to come.

All right. Yeah. Thanks for explaining that. Let me shift topics a bit — how have commodity prices been trending over the past month? Given that oil is more expensive, are certain suppliers of yours being forced to charge more because of, say, higher shipping expenses and things like that?

Yeah, fair question. We aren't really seeing much of an effect — just minor cost upticks at the edges so far — but we're working through contracts signed at the start of the year, where we locked in favorable pricing purchases. When we compare those against current conditions, only a very small amount of product is actually affected. Our routes aren't truly hitting our products. It's been tied more to fuel and distribution, and that hasn't appeared in our cost structure yet. We're cautiously optimistic that the routes we operate, which are mostly Asia, South America, we'll manage to obtain and get a bit of an update in, particularly on the western side of Africa, we'll manage to sidestep the bulk of whatever inflation is coming out of the East.

All right. For my final question, what kinds of efficiencies might come from bringing together the logistics of Laird Superfood and Navitas? Is warehouse consolidation on the table, or things like greater savings on freight? Could you speak to that a bit?

Yeah, that's a wonderful question. Obviously, we're looking at a timeline and doing diligence on it, and we'll have far more time to explore it moving ahead. Basically, what we've established here is a structure that's a bit different, in that it isn't an asset-light model. For essentially all of our logistics right now — all of our manufacturing logistics — we rely on co-packers and third-party distributors. There will definitely be chances to bring those together; we're making our way through the supply chains to spot not just costs, but opportunities around capability. I believe we've gotten costs optimized across the broad portfolio by taking advantage of the scale we now have. All at once, we've turned into a $100 million business, and doubling that, of course, doubles the opportunities for the various suppliers to our business too; we have some excellent partners. Navitas also has some excellent partners, and we're working through both sides of that ledger to try to conduct more business down the road. We certainly anticipate there's some opportunity there for our business.

Great. I appreciate the thorough explanation — I'll put it back in the queue.