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

Thanks, and good afternoon everyone. Welcome to the third quarter 2026 earnings conference call and webcast for Laird Superfood. Joining us today are Jason Vieth, Laird Superfood's President and Chief Executive Officer, along with Mark Johnson, our Chief Financial Officer. By this point, everyone should be able to access our earnings release, which was filed today after market close. You can find it in the investor relations section of our website at lairdsuperfood.com. Before we get started, please be aware that management may make forward-looking statements during this call within the context of federal securities laws. Such statements rest on management's current expectations and carry risks and uncertainties that could cause actual results to differ materially from those described. For a detailed discussion of these risks and uncertainties, please refer to today's press release and other filings with the SEC. With that said, I will hand the call over to Jason.

Appreciate that, Trevor, and hello everyone this afternoon. Jason Vieth here — I serve as President and CEO of Laird Superfood — and joining me is Mark Johnson, who holds the Chief Financial Officer role. Mark joined the company on October 1st. Prior to that, his most recent position was Vice President of Finance, North America, at Tropicana Brands Group. His background includes more than 25 years of finance leadership across publicly traded consumer packaged goods firms as well as private equity-backed operations in beverage, food, and premium pet food. Earlier in his career, before Tropicana, Mark worked at Champion Petfoods as Vice President of Commercial and Supply Chain Finance, and there he helped drive meaningful profit and sales growth. Before joining us, Mark held several high-level finance leadership roles at Danone and WhiteWave Foods, and he put in ten years at the Pepsi Bottling Group working in corporate planning and finance positions. We're pleased to have him on board as we continue integrating the platform and remain focused on sustainable, profitable growth. I'm also delighted to introduce Matt Kuusinen, who joins as our new Senior Vice President of Supply Chain. Matt previously served at Horizon Organic as Chief Procurement Officer. Prior to this role, Matt spent close to 20 years at Danone in senior supply chain positions, including VP of Supply Chain for Beverages and VP of Supply Chain for Plant-Based and Premium Dairy, along with earlier leadership roles in sales and operations planning, procurement, plant operations, and continuous improvement. As we continue integrating our brands, driving synergies, and supporting the platform's growth, his extensive experience scaling supply chains in plant-based and premium food and beverage will be a major asset. I've been fortunate to work with Matt and Mark previously, and as they join our management team, I expect a smooth transition. Q3 marked another significant quarter in building out our superfood platform. Net sales climbed 225%, reaching $42 million. The main drivers were a full quarter of contributions from Navitas and Terrasoul, plus ongoing expansion of distribution in the retail channel. Net income came in at $1.7 million, equal to $0.10 per basic and diluted share, and adjusted EBITDA was $2.1 million. Integration work continues to progress. Navitas, as we noted last quarter, is now fully integrated across our processes, organization, and ERP system. Together, Navitas and Laird function as a single team, with shared processes and accountability, and we show up as one unified presence to customers, distributors, and partners. That same disciplined approach is now being applied to Terrasoul. Accounting and finance are the furthest along, and systems and operational integration are now beginning. We're continuing to build out the Laird brand platform, and we've got a number of new launches coming that are meant to serve ongoing consumer appetite for products that are convenient, functional, and high in protein. Among them are a functional instant coffee line, electrolyte coffee powders, and coffee protein bars. Through these innovations we're drawing on our strengths in coffee and superfoods, extending our relevance into more occasions, and supporting growth in retail as well as e-commerce. Beyond that, we're moving forward with a revamped lineup of concepts for Navitas and Terrasoul, giving us solid launch platforms for 2027 throughout the combined business. Synergies from uniting these three business platforms are already showing up early in the results. Adjusted EBITDA reached $2.1 million, which mirrors the contribution of the acquired brands plus the cost and operational synergies we're starting to capture across the supply chain, shared overhead, and marketing. We expect those benefits to keep building, and we anticipate the combined go-to-market structure will continue producing returns by driving sales ahead. Like many peers in food and beverage, we're facing elevated cost headwinds. Fuel and freight expenses have risen substantially, and shoppers remain careful with their spending; we're pushing back against those pressures by taking selective pricing steps in particular channels, managing mix actively, containing costs more tightly, continuing productivity efforts in the supply chain, and keeping trade and promotional spending disciplined. Along with the synergies we're realizing from integration, those actions are assisting us in safeguarding margins as we continue putting money into growth. During our Q2 call, I mentioned that we are intentionally ramping up commercial and marketing spend considerably so that we can strengthen our brands and fuel sales growth. The way consumers behave is changing in directions that align squarely with what we do best, and we intend to take advantage of it. To illustrate, there's an obvious shift from conventional coffee pots toward handy powder-based coffee offerings, and we want to secure a solid share of that market through our powdered instant latte and our other coffee items. Meanwhile, people taking GLP-1 medications are changing how they eat, seeking to get the most nutrition out of every calorie they consume, and our superfood platform—built around clean, functional, high-quality nutrition—is ideally suited to meet that need. For Q4, our marketing outlay is rising by nearly $2 million compared with the same period last year, and we anticipate a similar bump for 2027. Underpinning that outlay are commercial capabilities far more robust than they were just a year ago, and we're laying the foundation for durable expansion down the road. With the platform now at meaningful scale, we've made a strategic choice to direct investment toward brand awareness, velocity, and new distribution. That positions us to seize these shifting occasions and keep growing even as consumers turn more cautious. Commercially, momentum is strong across key areas. Amazon and the rest of the online marketplaces are still powerful engines of growth for our brands. We are tapping into Terrasoul's considerable know-how and demonstrated best practices in marketplace operations, content, advertising, and fulfillment to get Laird and Navitas up and running and scaled on those platforms—speeding up their performance and seizing more of the demand out there. Retail expansion is also moving forward, following the Walmart coffee and creamer launches and the broader Navitas assortment at Target that we mentioned last quarter. Cacao and coffee products continue to post strong results and are adding to the category's momentum. Some organic gains were offset by weakness in direct-to-consumer and club channels, yet overall the platform is growing as planned. Cash at the close of the quarter was $17.3 million, and we carry no debt. This robust unlevered balance sheet supports the integration work now underway along with selective growth investments, and it affords us considerable flexibility as we manage today’s conditions and continue building the platform; during Q4, we will concentrate on carrying out the integration, generating growth in retail, e-commerce, and Amazon, and capturing the platform’s cost and revenue synergies. Thanks to the funding and strategic backing from our Nexus partners, we're in a strong position to continue developing what we think has the potential to be a top-tier, scaled platform in superfoods and positive nutrition. At this point I'll pass things along to Mark, who will walk through the figures in greater detail.

Thanks, Jason, and good afternoon to everyone. The third quarter marked our first complete quarter with all three brands operating together. I'll take you through what powered our results for quarter three, and after that I'll spend some time discussing how we're viewing the full year. Net sales came in at $42 million for the third quarter of 2026, which is 225% higher than the $12.9 million recorded in the third quarter of 2025, and 2% above the $41.3 million we posted last quarter. That gain came mainly from the Navitas and Terrasoul acquisitions, along with expanded distribution in our retail channel. E-commerce stood as our biggest channel during this quarter, climbing more than 3.5x year-over-year to $22.5 million and accounting for 54% of total net sales. This growth was led by adding Navitas and Terrasoul plus robust performance on amazon.com. Wholesale rose nearly 3x year-over-year to $19.4 million and represented 46% of total net sales, propelled by the addition of Navitas and Terrasoul; across the first nine months of the year, net sales reached $97.2 million, an increase of 166% versus $36.5 million in the prior year period, with wholesale accounting for 51% of total net sales and e-commerce accounting for 49%. Gross profit for the third quarter totaled $12.4 million, or 29.6% of net sales, versus $4.7 million, or 36.5% of net sales, in the prior year period, a contraction of roughly 7 percentage points. This margin compression stemmed mainly from inflationary commodity costs and the lower margins tied to the Terrasoul brand and its business model with lighter brand investment. On a year to date basis, gross profit was $29.6 million, or 30.4% of net sales, versus $14.4 million and 39.3% of net sales in the prior year period, driven by the same underlying factors. Total operating expenses reached $10.2 million in quarter three of 2026, compared with $5.7 million in the prior year period, up 79%. Sales and marketing expenses climbed 158% to $7.7 million, reflecting the bigger scale of the business after the acquisitions, variable selling costs on higher sales volume, greater people costs as we build out the team to support the broader organization, and more marketing investment across both online and retail channels. General and administrative expenses fell 9% to $2.4 million. That decline resulted from a $4.1 million non-cash gain from the change in fair value of contingent consideration tied to the acquisitions. Without that gain, G&A would have come in at $6.6 million. That figure includes $0.7 million of business combination and integration costs, $1.1 million of amortization of acquired intangible assets, and $1.5 million of stock-based compensation. These items are either one-time or non-cash in nature. Net income for the third quarter of 2026 was $1.7 million, versus a net loss of $1 million in the prior year period. Adjusted EBITDA came to $2.1 million in the third quarter of 2026, compared with $0.2 million in the prior year period. We consider adjusted EBITDA a more representative gauge of the underlying operating performance of the business, since it leaves out items that don't reflect the ongoing cash economics. Growth in adjusted EBITDA comes mainly from adding Navitas and Terrasoul plus early realization of synergies, partly offset by inflationary commodity costs and higher marketing and selling expenses. On a year to date basis, net income came in at $1.7 million, versus a net loss of $1.5 million during the first nine months of 2025. Year to date adjusted EBITDA reached $3.9 million, compared with $0.7 million in the prior year period; now turning to our balance sheet. As of September 30, 2026, cash stood at $17.3 million versus $23.2 million at the end of the last quarter. In quarter three, cash utilization did increase, as inventory and receivables both rose because of the timing of sales and the seasonal purchase of raw materials. We expect to finish the year with more than $20 million in cash; now turning to our 2026 financial outlook; we are updating our full year 2026 guidance; for fiscal 2026, consolidated net sales should land in the range of $135 million-$140 million, reflecting a full year of Laird Superfood and the post-acquisition contributions of Navitas and Terrasoul. Adjusted EBITDA should come in between $5 million and $6 million, reflecting our strategic decision to invest further in marketing activities to drive incremental consumer demand. With that, I'll hand the call back to Jason for closing remarks, and then we will open it up for questions.

Thanks, Mark. In short, the third quarter shows how large the combined platform is and how quickly we're capturing synergies from it. We're moving forward with bringing Terrasoul into the fold, growing the Laird platform through new functional and high-protein products, and at the same time building strong launch platforms for 2027 for Navitas and Terrasoul. We're intentionally stepping up marketing and commercial spending, which includes roughly $2 million more in Q4 and additional increases in 2027, so we can take advantage of changing consumer habits, like the shift toward powder-based coffee and GLP-1 users wanting nutritionally dense choices. We're also rolling out Terrasoul's marketplace best practices across the portfolio and actively managing the cost headwinds facing the industry. We look forward to keeping you updated as we make further progress. Thanks for being with us today.

Great. Thanks for taking my questions. First, I was just wondering whether you could expand a little bit more on the marketing increases — some additional color on where the investment is going, which channels. Should we think of this — I think you mentioned more brand awareness — so should we think of it as more of a top-of-funnel kind of investment? If you could just expand overall on the expanded marketing investment outlook, that would be helpful. Thank you.

Hey, Eric. This is Jason. Great question, and thanks for asking it; we really wanted to take a couple of minutes to talk about that. As you'll recall from a few earlier calls, Andy Judd has rejoined the company. He'd worked with us before, then departed to lead marketing at Poppi. When Andy came back, we pretty much assumed we'd identify places to invest marketing spend in ways that would strengthen the brand for years ahead. That's what this reflects, Eric. So just as you put it, I'd view this as activation aimed more at the top of the funnel. The approach will be a blend, because while we clearly see room to build out the brand—or rather, each of the brands, meaning Laird and Navitas right now—and while we see a real chance to turn those into household names over the coming years, there's still substantial conversion upside across the different marketplaces. For Terrasoul at this point, we aren't really contemplating much top-of-funnel, higher-level marketing. It remains more of a commodity business, though a very strong brand in the marketplaces where it currently operates. We'll ease into that cautiously. We also think there's an opportunity there down the road. At the moment, though, the priority is squarely on launching the Laird and Navitas brands. Eric, I have to say this genuinely caught all of us off guard in the best way — it went right up to the board level. We conducted consumer surveys to assess our brand equity, and the results were highly consistent. Among people familiar with us, we came across as one of the very top names they know and trust; however, we discovered that awareness of us — whether Laird, Navitas, or Terrasoul — was severely lacking among consumers. Consumers are buying our brands and enjoying our products—they spot the packaging—yet our name isn't widely recognized. That's what we intend to fix, and going forward we plan to use those strong NPS and brand affinity scores to connect with a larger group of consumers.

Okay, that's really useful. Regarding the recent wins with Walmart, last quarter you mentioned rolling out new SKUs across roughly 1,000 Walmart doors, and for Navitas, some additional shelf space at Target. What's your initial read on how those are doing? How should we think about possible routes to keep gaining distribution with those customers?

Yeah, good question. I mean, it's still early. We're only in the first quarter, and clearly this is a big step for us as a natural-oriented brand in Laird, taking that brand into Walmart, and honestly even for Navitas to be expanding into Target on a larger scale. What I'd say is both are going well. We're watching closely, and we're putting a lot of pressure into those stores. Right now we're running various campaigns, not just with those two retailers wherever we can, but we're also running social campaigns around the local stores for those retailers where we have distribution, plus leveraging Instacart and other vehicles that are proving very effective. What I'd tell you is the read is still early, it's positive, and frankly it's been growing week after week, pretty much from launch onward; we still have some headroom before we get where we want to be, but we feel really confident about where we stand so far.

Alright, great. This is going to be my final question, and I'd just like to get a sense of where you stand on M&A. I mean, clearly there's still a fair amount of work left on the Terrasoul integration. My assumption is that we probably shouldn't be holding our breath for another acquisition at this point. If I had to guess, it's likely a second half 2027 kind of thing. Anyway, if you could just address, I suppose, first, your appetite for continued M&A in the near term, and then more broadly — setting timing aside — has the inflationary commodity cost environment affected your M&A pipeline in any way, if at all? Thanks.

Yeah. Okay, several points are packed in there, so I’ll attempt to address each one, and let me know if anything gets left out. Your instinct seems correct to me. At present we’ve got some work ahead of us as we proceed. Navitas was a relatively straightforward integration, and honestly we could take that business in and run it inside Laird’s existing infrastructure—systems, processes, people, and so on. In my view that went really smoothly. Terrasoul is a different animal. We've got a facility in Fort Worth, and there's definitely going to be substantial opportunity for us as we consider bringing more products into that site — whether that means shifting Laird and Navitas volumes, moving some of those volumes out of the existing network and into Fort Worth, or introducing new products. We still have some network design work ahead, so that we're truly taking a holistic view of an in-house facility alongside some very strong co-pack partnerships that we might use to balance the whole business across. There's plenty of work to do there when it comes to achieving the best cost efficiency across the now in-sourced and outsourced network, as well as implementing a combined ERP system. As I believe I've noted previously, Terrasoul operates with an ERP platform that genuinely cannot support further growth, so we'll need to migrate them onto a comparable—perhaps identical—ERP instance to the one we currently run. Considerable effort lies ahead. That effort is now beginning in earnest; we've held a kickoff and initial conversations, but we've just added a new supply chain leader along with a new CFO, and those two individuals are precisely where execution will ultimately be tested. Over the coming two weeks or so, we'll get our hands around it and set up next year's plan to get it operational. In doing so, we ultimately aim to restore ourselves to a stronger position for future M&A. I'd put it this way: we're not stepping away from the M&A market, but we would be much more cautious and careful, and at present it would take something quite special, given some of the other priorities within the business. Regarding the pipeline — well, that pipeline is still robust. Since Nexus plays such a central role in this business when it comes to strategy and board governance, we now see a much larger set of opportunities than we did previously. That pool of opportunities has expanded exponentially, which means, as you can imagine, we're able to be far more selective about which ones we pursue. We feel very confident that we have a coffee platform — called Coffee Solutions — along with a functional health and wellness ingredients platform where Navitas and Terrasoul are a strong fit. We intend to build on those two platforms and also to establish a third leg on that stool. It’s definitely still going to be there, though over roughly the coming half year, I’d guess your read on it is close to how I see it.

Great, and thanks for taking the time to answer my questions.

Sure thing.

Great, and thanks, guys. I appreciate you taking my questions today. Maybe we could just start on the sales guidance revision. Could you elaborate just a little on where exactly the shortfall sits relative to what you expected last quarter? And then could you also update us on what underlying growth rates you're assuming for each business at that new guidance level?

Hi, thanks for the question. This is Mark Johnson. We expected just about everything else to be flat. We continue to notice modest headwinds in club and DTC, which we've discussed before, and we essentially incorporated them into our fourth-quarter assumptions—so we expect that to be the primary factor behind our landing toward the lower end of the range. My apologies—I missed the second question.

So that was purely the organic growth that now serves as the basis for the outlook across each of our businesses. My recollection is that previously it was maybe around high single digits or low double digits for each one, but I'm just wondering if you could update us on what's assumed at this stage.