Financial Data and Key Metrics Changes - Net sales grew 20% year over year to $12 million in Q2, driven by a 47% increase in the wholesale channel, which now represents nearly half of total net sales [5][10] - Gross margin was 39.9%, slightly down from 41.8% in the prior year due to higher trade spend and commodity costs, yet remains among the best in the industry [6][11] - Adjusted EBITDA was positive at $100,000 compared to a loss of $100,000 in the same quarter last year, indicating progress towards profitability [12] Business Line Data and Key Metrics Changes - Coffee creamers led growth with a 44% increase, making up 56% of gross sales, reflecting consumer demand for plant-based options [5][10] - Coffee, tea, and hot chocolate products also grew by 44%, aligning with the company's strategy to become a leader in functional coffee solutions [6] Market Data and Key Metrics Changes - E-commerce sales increased by 2% year over year, contributing 52% of total net sales, primarily driven by Amazon [10][11] - The wholesale channel's growth was attributed to distribution expansion and increased velocity in grocery and club stores [10][11] Company Strategy and Development Direction - The company is focusing on growing its wholesale channel to become the largest segment of its business, with a strategic emphasis on brand building, innovation, and operational efficiency [5][9] - Plans to introduce new products, including a super optimized liquid creamer and a protein-based coffee product, are underway, indicating a commitment to innovation [36][39] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about the second half of the year, despite ongoing economic pressures and tariff uncertainties, highlighting the company's resilience and strong brand appeal [9][17] - The company reaffirmed its full-year net sales growth guidance of 20% to 25% and aims to maintain gross margins while achieving breakeven adjusted EBITDA [15][17] Other Important Information - The company ended the quarter with $4.2 million in cash and no debt, indicating a solid balance sheet [7][13] - Cash usage was primarily driven by inventory investments to meet demand and mitigate supply chain risks, with expectations to normalize in the coming quarters [7][14] Q&A Session Summary Question: Revenue guidance for the year and confidence in achieving it - Management noted that previous out-of-stock issues and a cyber attack impacted sales, but they do not anticipate similar events in the second half, supporting their revenue guidance [20][22] Question: Impact of the cyber attack and liquid product transition - The cyber attack is estimated to have cost around $100,000 in sales, while the transition to a new liquid product size has been challenging but is now showing positive results [26][27][29] Question: Innovation focus for the back half of the year - The company is excited about new product innovations, including a new liquid creamer formula and a protein-based coffee product, which are expected to differentiate them in the market [35][39] Question: Performance during Amazon Prime Day and customer acquisition metrics - Amazon Prime Day went as planned, with strong initial sales, although e-commerce growth is slowing, reflecting broader trends in the industry [46][52] Question: Plans for increasing trade promotion - Management is considering increasing trade promotions in response to consumer price sensitivity but has not yet made decisions, focusing on maintaining gross margins [54][56]

Part I. Financial Information [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated condensed financial statements of Laird Superfood, Inc. for the period ended June 30, 2025, including balance sheets, statements of operations, stockholders' equity, and cash flows, along with detailed notes explaining significant accounting policies, financial position, and operational results [Unaudited Consolidated Condensed Balance Sheets](index=4&type=section&id=Unaudited%20Consolidated%20Condensed%20Balance%20Sheets) This section presents the Company's financial position, detailing assets, liabilities, and stockholders' equity at specific reporting dates Consolidated Condensed Balance Sheet Metrics ($) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :------------------ | | Total Assets | $20,426,736 | $19,259,001 | | Total Liabilities | $7,052,795 | $6,062,135 | | Total Stockholders' Equity | $13,373,941 | $13,196,866 | - Current assets increased to **$19.2 million** as of June 30, 2025, from **$18.0 million** as of December 31, 2024, primarily due to a significant increase in inventory[13](index=13&type=chunk) - Current liabilities increased to **$7.0 million** as of June 30, 2025, from **$5.9 million** as of December 31, 2024, mainly driven by increases in accounts payable and accrued expenses[13](index=13&type=chunk) [Unaudited Consolidated Condensed Statements of Operations](index=5&type=section&id=Unaudited%20Consolidated%20Condensed%20Statements%20of%20Operations) This section outlines the Company's financial performance over specific periods, including net sales, gross profit, operating loss, and net loss Consolidated Condensed Statements of Operations ($) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Sales, net | $11,990,842 | $10,003,654 | $23,645,001 | $19,912,592 | | Gross profit | $4,781,003 | $4,177,281 | $9,662,543 | $8,141,382 | | Operating loss | $(399,477) | $(338,621) | $(617,496) | $(1,427,183) | | Net loss | $(362,178) | $(239,076) | $(518,360) | $(1,255,598) | | Net loss per share (Basic & Diluted) | $(0.03) | $(0.02) | $(0.05) | $(0.13) | - Net sales increased by **20%** for the three months ended June 30, 2025, and by **19%** for the six months ended June 30, 2025, compared to the prior year periods[16](index=16&type=chunk) - Net loss increased by **51%** for Q2 2025 but decreased by **59%** for YTD 2025, indicating improved performance over the longer period despite a quarterly setback[16](index=16&type=chunk) [Unaudited Consolidated Condensed Statements of Stockholders' Equity](index=6&type=section&id=Unaudited%20Consolidated%20Condensed%20Statements%20of%20Stockholders%27%20Equity) This section details changes in the Company's equity, reflecting common stock, additional paid-in capital, and accumulated deficit over time Consolidated Condensed Statements of Stockholders' Equity ($) | Metric | Balances, January 1, 2025 | Balances, June 30, 2025 | | :------------------------ | :------------------------ | :---------------------- | | Common Stock (Amount) | $10,292 | $10,644 | | Additional Paid-in Capital| $121,304,884 | $121,999,967 | | Accumulated Deficit | $(108,118,310) | $(108,636,670) | | Total Stockholders' Equity| $13,196,866 | $13,373,941 | - Stockholders' equity increased from **$13.2 million** at January 1, 2025, to **$13.4 million** at June 30, 2025, primarily due to stock-based compensation and stock option exercises, partially offset by net loss[18](index=18&type=chunk) [Unaudited Consolidated Condensed Statements of Cash Flows](index=7&type=section&id=Unaudited%20Consolidated%20Condensed%20Statements%20of%20Cash%20Flows) This section reports the Company's cash inflows and outflows from operating, investing, and financing activities over specific periods Consolidated Condensed Statements of Cash Flows ($) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------- | :----------------------------- | :----------------------------- | | Operating activities | $(4,102,366) | $220,414 | | Investing activities | $(80,638) | $(13,462) | | Financing activities | $(146,373) | $(86,066) | | Net change in cash | $(4,329,377) | $120,886 | | Cash, end of period | $4,184,775 | $7,827,692 | - Net cash used in operating activities significantly increased to **$4.1 million** for YTD 2025, compared to net cash provided of **$0.2 million** for YTD 2024, driven by strategic investment in inventory and elevated accounts receivable[21](index=21&type=chunk)[28](index=28&type=chunk) [Notes to Unaudited Consolidated Condensed Financial Statements](index=8&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Condensed%20Financial%20Statements) This section provides detailed explanations and disclosures supporting the unaudited consolidated condensed financial statements [1. Summary of Significant Accounting Policies and Estimates](index=8&type=section&id=1.%20Summary%20of%20Significant%20Accounting%20Policies%20and%20Estimates) This section outlines the basis of financial statement preparation, including consolidation of Laird Superfood, Inc. and Picky Bars, LLC, and the Company's single reportable segment. It also addresses the Company's liquidity position, recent accounting pronouncements, and subsequent events, such as the impact of new tax legislation - The Company operates as one reportable segment: **superfood**, which includes coffee creamers, hydration and beverage enhancing products, snacks, and coffee/tea/hot chocolate products[25](index=25&type=chunk)[98](index=98&type=chunk) - As of June 30, 2025, the Company had **$4.2 million cash-on-hand** and believes existing cash and anticipated cash flow will be sufficient for operations for at least the next twelve months, despite **$4.1 million cash used in operating activities** for the six months ended June 30, 2025[28](index=28&type=chunk)[29](index=29&type=chunk) - Cash used in operations was driven by a strategic investment in inventory (up to **$11.0 million** from **$6.0 million**) to meet demand, address out-of-stocks, and forward purchase due to potential tariffs, with normalization expected in late 2025/early 2026[28](index=28&type=chunk) - New accounting pronouncements, ASU 2023-09 (Income Taxes) and ASU 2024-03 (Income Statement Expenses), are being evaluated for their impact on financial statements, with effective dates in 2025 and 2026/2027, respectively[30](index=30&type=chunk)[31](index=31&type=chunk) - The One Big Beautiful Bill Act (OBBBA) signed on July 4, 2025, will impact income tax effects starting in the period it was signed into law, with the Company currently assessing its full impact[33](index=33&type=chunk) [2. Cash, Cash Equivalents, and Restricted Cash](index=10&type=section&id=2.%20Cash%2C%20Cash%20Equivalents%2C%20and%20Restricted%20Cash) This note details the composition of cash, cash equivalents, and restricted cash, including amounts held for contractual agreements and those exceeding FDIC/SIPC insurable limits Cash, Cash Equivalents, and Restricted Cash Breakdown ($) | Category | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :------------------ | | Cash and cash equivalents | $3,928,241 | $8,339,918 | | Restricted cash | $256,534 | $174,234 | | Total cash, cash equivalents, and restricted cash | $4,184,775 | $8,514,152 | - Restricted cash includes **$99,525** for COVID-19 relief projects and **$157,009** to collateralize credit card limits as of June 30, 2025[40](index=40&type=chunk) - Balances exceeding FDIC/SIPC limits were **$3,295,724** as of June 30, 2025, down from **$7,621,392** at December 31, 2024[38](index=38&type=chunk) [3. Inventory](index=10&type=section&id=3.%20Inventory) This section provides a breakdown of inventory components and details the inventory obsolescence and disposal costs incurred during the periods Inventory Components ($) | Inventory Component | June 30, 2025 | December 31, 2024 | | :------------------------ | :------------ | :------------------ | | Raw materials and packaging | $4,204,361 | $3,049,399 | | Finished goods | $6,823,254 | $2,926,277 | | Total Inventory | $11,027,615 | $5,975,676 | - Inventory obsolescence and disposal costs were **$300,223** for Q2 2025 and **$401,938** for YTD 2025, significantly higher than the prior year periods[42](index=42&type=chunk) Inventory Reserve Components ($) | Inventory Reserve Component | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :------------------ | | Estimated based on turnover, quantities, expiration dates | $150,153 | $132,557 | | Discontinued product | $200,306 | $293,235 | | Total inventory reserves | $350,459 | $425,792 | [4. Prepaid Expenses and Other Current Assets](index=11&type=section&id=4.%20Prepaid%20Expenses%20and%20Other%20Current%20Assets) This note details the components of prepaid expenses and other current assets, including prepaid inventory Prepaid Expenses and Other Current Assets Breakdown ($) | Component | June 30, 2025 | December 31, 2024 | | :------------------------ | :------------ | :------------------ | | Prepaid expenses | $637,710 | $568,549 | | Prepaid inventory | $214,987 | $871,406 | | Deposits | $333,739 | $222,483 | | Other current assets | $66,822 | $51,451 | | Total | $1,253,258 | $1,713,889 | - Prepaid inventory decreased significantly from **$871,406** at December 31, 2024, to **$214,987** at June 30, 2025[44](index=44&type=chunk) [5. Property and Equipment](index=11&type=section&id=5.%20Property%20and%20Equipment) This section outlines the Company's property and equipment, net, and associated depreciation expenses Property and Equipment, Net Carrying Amount ($) | Category | June 30, 2025 (Net Carrying Amount) | December 31, 2024 (Net Carrying Amount) | | :------------------------ | :---------------------------------- | :------------------------------------ | | Furniture and office equipment | $81,484 | $43,648 | | Leasehold improvements | $11,749 | $14,799 | | Total | $93,233 | $58,447 | - Depreciation expense for YTD 2025 was **$45,852**, an increase from **$39,580** in YTD 2024[45](index=45&type=chunk) [6. Intangible Assets](index=12&type=section&id=6.%20Intangible%20Assets) This note details the Company's intangible assets, including trade names, recipes, and licensing agreements, along with their amortization and impairment evaluation Intangible Assets, Net Carrying Amount ($) | Intangible Asset | June 30, 2025 (Net Carrying Amount) | December 31, 2024 (Net Carrying Amount) | | :------------------------ | :---------------------------------- | :------------------------------------ | | Trade names | $623,578 | $677,029 | | Recipes | $192,500 | $209,000 | | Other intangible assets | $0 | $10,094 | | Licensing agreements | $132,100 | $132,100 | | Total intangible assets | $948,178 | $1,028,223 | - Amortization expense for YTD 2025 was **$80,045**, a decrease from **$98,999** in YTD 2024[48](index=48&type=chunk) - The Company evaluated the recoverability of the Picky Bars asset group as of March 31, 2025, due to lower sales, but no impairment was recorded as estimated undiscounted future cash flows exceeded the carrying amount[49](index=49&type=chunk) [7. Accrued Expenses](index=12&type=section&id=7.%20Accrued%20Expenses) This section provides a breakdown of the Company's accrued expenses Accrued Expense Components ($) | Accrued Expense Component | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :------------------ | | Accrued compensation and benefits | $1,255,139 | $1,993,008 | | Accrued accounts payable | $2,403,974 | $1,082,789 | | Other accrued expenses | $407,142 | $567,201 | | Total accrued expenses | $4,066,255 | $3,642,998 | - Accrued accounts payable significantly increased from **$1.1 million** at December 31, 2024, to **$2.4 million** at June 30, 2025[51](index=51&type=chunk) [8. Leases](index=13&type=section&id=8.%20Leases) This note details the Company's operating lease agreements for corporate office space, including lease expenses and future minimum payments, and also reports on rental income from a sublease that terminated in October 2024 Lease Expenses ($) | Lease Expense Category | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2024 | | :----------------------------- | :------------------------------- | :----------------------------- | :------------------------------- | :----------------------------- | | Operating lease cost | $23,059 | $46,119 | $38,085 | $76,169 | | Short-term lease rent expense | $117,110 | $210,859 | $79,897 | $144,127 | | Total rent expense | $140,169 | $256,978 | $123,772 | $231,651 | - Total rent expense increased for both the three and six months ended June 30, 2025, compared to the prior year periods[53](index=53&type=chunk) Future Minimum Lease Payments ($) | Future Minimum Lease Payments | Amount | | :------------------------------------ | :----- | | 2025 (excluding six months ended June 30, 2025) | $52,983 | | 2026 | $109,145 | | 2027 | $56,210 | | Total | $218,338 | | Less imputed interest | $(16,340) | | Operating lease liabilities | $201,998 | [9. Income Taxes](index=14&type=section&id=9.%20Income%20Taxes) This note discusses the Company's income tax position, including the absence of current federal income tax due to net losses, the reconciliation of income tax expense, and the composition of deferred tax assets and net operating loss (NOL) carryforwards Income Tax Metrics ($) | Income Tax Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Income tax benefit at statutory rates | $117,815 | $229,541 | | Valuation allowance for deferred tax assets | $(328,074) | $(626,845) | | Reported income tax expense | $(20,873) | $(42,481) | | Effective tax rate | 4.2% | 3.5% | Deferred Tax Assets ($) | Deferred Tax Asset Category | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :------------------ | | Net operating loss carryforwards | $21,831,513 | $21,368,607 | | Total deferred tax assets | $26,655,261 | $26,264,674 | | Valuation allowance | $(26,655,261) | $(26,264,674) | | Total net deferred tax assets | $0 | $0 | - The Company has a full valuation allowance against its deferred tax assets due to cumulative losses since inception, resulting in **no net deferred tax assets**[55](index=55&type=chunk)[61](index=61&type=chunk) Net Operating Losses and Other Carryforwards ($) | NOLs and Other Carryforwards | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :------------------ | | Federal NOLs post-2018 | $84,558,192 | $82,744,578 | | State NOLs | $62,423,359 | $60,941,124 | | Total NOLs | $148,849,628 | $145,553,779 | [10. Stock Incentive Plan](index=16&type=section&id=10.%20Stock%20Incentive%20Plan) This note details the Company's 2020 Stock Incentive Plan, summarizing activity for stock options, restricted stock units (RSUs), and market-based stock units (MSUs), along with the associated stock-based compensation expense - As of June 30, 2025, **1,193,862 authorized shares** were issuable or eligible for awards under the 2020 Plan, excluding **2,168,061 shares** for outstanding options and RSUs[66](index=66&type=chunk) Stock Option Activity (Shares, $) | Stock Option Activity | Balance at Jan 1, 2025 | Granted | Exercised/Released | Balance at Jun 30, 2025 | | :-------------------------- | :--------------------- | :------ | :----------------- | :---------------------- | | Options | 1,630,428 | — | (74,000) | 1,556,428 | | Weighted Average Exercise Price | $3.47 | $— | $0.92 | $3.59 | | Aggregate Intrinsic Value | $8,770,109 | $— | $— | $6,301,890 | RSU Activity (Units, $) | RSU Activity | Balance at Jan 1, 2025 | Granted | Exercised/Released | Balance at Jun 30, 2025 | | :-------------------------- | :--------------------- | :------ | :----------------- | :---------------------- | | Number of RSUs | 1,115,498 | 114,760 | (335,209) | 895,049 | | Weighted Average Grant Date Fair Value | $3.85 | $5.88 | $4.03 | $4.09 | | Aggregate Fair Value | $4,294,241 | $— | $— | $3,657,528 | Stock-Based Compensation Expense and Unrecognized Cost ($) | Stock-Based Compensation | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | Unrecognized Compensation Cost as of June 30, 2025 | | :------------------------- | :------------------------------- | :----------------------------- | :------------------------------------------------- | | Stock options | $79,183 | $160,515 | $459,365 | | RSUs | $409,393 | $836,471 | $3,302,516 | | Total | $488,576 | $996,986 | $3,761,881 | [11. Loss per Share](index=20&type=section&id=11.%20Loss%20per%20Share) This note presents the basic and diluted net loss per share, along with the weighted-average shares outstanding and anti-dilutive securities excluded from the calculation Net Loss per Share Calculation ($, Shares) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net loss | $(362,178) | $(239,076) | $(518,360) | $(1,255,598) | | Weighted average shares outstanding | 10,517,528 | 9,833,001 | 10,431,987 | 9,617,800 | | Net loss per share, basic and diluted | $(0.03) | $(0.02) | $(0.05) | $(0.13) | - Common stock options, restricted stock awards, and market-based stock awards totaling **2,451,477 shares** for YTD 2025 were excluded from diluted EPS calculation due to their anti-dilutive effect[81](index=81&type=chunk) [12. Concentrations](index=20&type=section&id=12.%20Concentrations) This note identifies significant concentrations in vendor accounts payable, customer accounts receivable, sales to specific customers, and purchases from key suppliers and geographical regions Vendor Accounts Payable Concentration (%) | Vendor Accounts Payable Concentration | June 30, 2025 | December 31, 2024 | | :------------------------------------ | :------------ | :------------------ | | Vendor B | 31% | 18% | | Total (top vendors) | 31% | 42% | Customer Accounts Receivable Concentration (%) | Customer Accounts Receivable Concentration | June 30, 2025 | December 31, 2024 | | :----------------------------------------- | :------------ | :------------------ | | Customer A | 40% | 43% | | Customer C | 28% | 14% | | Total (top customers) | 78% | 77% | Sales Concentration by Customer (Gross Sales) (%) | Sales Concentration (Gross Sales) | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :-------------------------------- | :------------------------------- | :----------------------------- | | Customer A | 17% | 18% | | Customer C | 19% | 15% | | Total (top customers) | 48% | 48% | Purchase Concentration by Supplier (%) | Purchase Concentration (Suppliers) | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :--------------------------------- | :------------------------------- | :----------------------------- | | Supplier B | 24% | 17% | | Supplier A | 20% | 17% | | Total (top suppliers) | 44% | 34% | Purchase Concentration by Region (%) | Purchase Concentration (Regions) | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :------------------------------- | :------------------------------- | :----------------------------- | | Country A | 25% | 23% | | Country B | * | 13% | | Total (top regions) | 25% | 36% | [13. Related Parties](index=22&type=section&id=13.%20Related%20Parties) This note discloses transactions with related parties, including license agreements with Mr. Hamilton and Ms. Reece, and marketing agreements with Ms. Reece - The Company has a License and Preservation Agreement with Mr. Hamilton and Ms. Reece, granting the Company rights to extend the term for additional ten-year periods after the initial one-hundred-year term[90](index=90&type=chunk) - Marketing services provided by Ms. Reece resulted in advertising expenses of **$77,984** for Q2 2025 and **$147,173** for YTD 2025, with **$57,947** payable to her as of June 30, 2025[91](index=91&type=chunk) [14. Revenue Recognition](index=22&type=section&id=14.%20Revenue%20Recognition) This note details the Company's revenue recognition policies, disaggregating net sales by product category and sales channel (e-commerce and wholesale), and providing information on receivables and contract liabilities Gross Sales by Product Category ($, %) | Product Category (Gross Sales) | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :------------------------------- | :------------------------------- | :----------------------------- | | Coffee creamers | $6,770,922 (56%) | $13,483,574 (57%) | | Coffee, tea, and hot chocolate products | $3,599,037 (30%) | $6,819,928 (29%) | | Hydration and beverage enhancing products | $1,824,025 (15%) | $3,930,204 (17%) | | Snacks and other food items | $1,412,979 (12%) | $2,843,707 (12%) | Net Sales by Channel ($, %) | Sales Channel (Net Sales) | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :------------------------ | :------------------------------- | :----------------------------- | | E-commerce | $6,237,344 (52%) | $12,450,460 (53%) | | Wholesale | $5,753,498 (48%) | $11,194,541 (47%) | | Total | $11,990,842 (100%) | $23,645,001 (100%) | - Wholesale channel sales increased to **48%** of net sales for Q2 2025 (from 39% in Q2 2024) and **47%** for YTD 2025 (from 40% in YTD 2024), indicating a strategic shift towards retail distribution[95](index=95&type=chunk)[106](index=106&type=chunk) [15. Reportable Segment](index=24&type=section&id=15.%20Reportable%20Segment) This note confirms that the Company operates as a single reportable segment, 'superfood,' and reconciles consolidated net loss to adjusted EBITDA, a non-GAAP measure used by management to assess performance - The Company's Chief Executive Officer, as the Chief Operating Decision Maker (CODM), reviews financial information for the single **'superfood' segment**, which focuses on clean, functional, and sustainability-conscious food alternatives[98](index=98&type=chunk)[99](index=99&type=chunk) Adjusted EBITDA Reconciliation ($) | Metric | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :-------------------------------- | :------------------------------- | :----------------------------- | | Net loss | $(362,178) | $(518,360) | | Depreciation and amortization | $59,376 | $125,897 | | Stock-based compensation | $488,576 | $996,986 | | Adjusted EBITDA | $148,475 | $505,387 | - Adjusted EBITDA for YTD 2025 was **$505,387**, a significant improvement from **$(790,544)** in YTD 2024, reflecting management's focus on operating performance excluding non-cash and non-recurring items[101](index=101&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Conditions and Results of Operations](index=24&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Conditions%20and%20Results%20of%20Operations) This section provides an overview of Laird Superfood's business, financial highlights, strategic objectives, and a detailed analysis of its financial performance for the three and six months ended June 30, 2025, compared to the prior year. It also discusses cash flows, liquidity, capital resources, and critical accounting estimates [Overview](index=25&type=section&id=Overview) This section introduces Laird Superfood's business model, product focus, and long-term strategic objectives - Laird Superfood focuses on clean, minimally processed, functional foods with adaptogens, including coffee creamers, hydration products, snacks, and coffee/tea/hot chocolate[103](index=103&type=chunk) - The long-term goal is to build a widely recognized brand emphasizing recognizable ingredients, nutritional density, and functionality to maximize penetration in the grocery market[103](index=103&type=chunk) [Financial Highlights](index=25&type=section&id=Financial%20Highlights) This section summarizes key financial performance indicators, including sales channel contributions and growth rates - E-commerce (DTC and Amazon.com) accounted for **52%** of net sales in Q2 2025 and **53%** in YTD 2025, while wholesale (retail outlets) made up **48%** and **47%** respectively[106](index=106&type=chunk) - Wholesale net sales increased by **47%** in Q2 2025 and **41%** in YTD 2025, driven by distribution expansion and velocity growth in grocery and club stores[107](index=107&type=chunk)[108](index=108&type=chunk) - E-commerce sales grew by **2%** in Q2 2025 and **4%** in YTD 2025, primarily from subscription and repeat customer revenue, with repeat customers accounting for over **80%** of DTC sales[104](index=104&type=chunk)[107](index=107&type=chunk)[108](index=108&type=chunk) [Our Strategy and Key Factors Affecting our Future Performance](index=26&type=section&id=Our%20Strategy%20and%20Key%20Factors%20Affecting%20our%20Future%20Performance) This section outlines the Company's strategic priorities and critical factors influencing its future operational and financial success - Key factors for future performance include growing the customer base in e-commerce and wholesale channels at a reasonable cost, managing third-party production and logistics, driving repeat usage, expanding product lines, and optimizing gross and operating margins[109](index=109&type=chunk)[110](index=110&type=chunk)[111](index=111&type=chunk)[112](index=112&type=chunk)[113](index=113&type=chunk)[114](index=114&type=chunk) - The Company aims to expand its retail distribution footprint, expecting the wholesale channel to eventually surpass e-commerce as a percentage of net sales[106](index=106&type=chunk) - Effective management of the global supply chain and working capital components are also critical for growth and positive cash flows[115](index=115&type=chunk)[116](index=116&type=chunk) [Components of Results of Operations](index=27&type=section&id=Components%20of%20Results%20of%20Operations) This section defines the key revenue and expense categories that constitute the Company's financial performance - Net sales are generated through wholesale (distributors, retail outlets) and e-commerce (direct websites, Amazon.com)[117](index=117&type=chunk) - Cost of goods sold includes raw materials, packaging, co-packing fees, freight, import duties, indirect labor, and overhead for storage and distribution[118](index=118&type=chunk) - Operating expenses comprise general and administrative, research and product development, and sales and marketing expenses, including non-production personnel costs[119](index=119&type=chunk) - No significant federal income tax expenses are expected due to historical and anticipated operating losses, but state and local income taxes will continue to be owed[120](index=120&type=chunk) [Results of Operations](index=27&type=section&id=Results%20of%20Operations) This section provides a detailed analysis of the Company's financial performance across various periods, highlighting key drivers of change [Comparison of Q2 2025 and Q2 2024](index=27&type=section&id=Comparison%20of%20Q2%202025%20and%20Q2%202024) Net sales increased by 20% to $12.0 million, driven by wholesale expansion and improved velocities, partially offset by increased promotional spend. Gross profit rose by 14%, but gross margin contracted due to channel mix and commodity inflation. Operating expenses increased, leading to a higher operating loss Q2 Financial Performance Comparison ($, %, pts) | Metric | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :-------------------------- | :---------- | :---------- | :--------- | :--------- | | Sales, net | $11,990,842 | $10,003,654 | $1,987,188 | 20% | | Cost of goods sold | $(7,209,839) | $(5,826,373) | $(1,383,466) | 24% | | Gross profit | $4,781,003 | $4,177,281 | $603,722 | 14% | | Gross margin | 39.9% | 41.8% | | -1.9 pts | | Total operating expenses | $5,180,480 | $4,515,902 | $664,578 | 15% | | Operating loss | $(399,477) | $(338,621) | $(60,856) | 18% | | Net loss | $(362,178) | $(239,076) | $(123,102) | 51% | - The **20% increase in net sales** was primarily fueled by a **47% increase in wholesale channel sales**, driven by distribution expansion and improved product velocities, partially offset by higher promotional trade spend[121](index=121&type=chunk) - Gross margin contracted by **1.9 percentage points** to **39.9%** due to channel mix and commodity cost inflation[123](index=123&type=chunk) - General and administrative expenses increased by **3%** due to stock-based compensation and personnel costs, while sales and marketing expenses rose by **26%** due to increased marketing and selling costs[124](index=124&type=chunk)[125](index=125&type=chunk) [Comparison of YTD 2025 and YTD 2024](index=29&type=section&id=Comparison%20of%20YTD%202025%20and%20YTD%202024) Net sales for YTD 2025 increased by 19% to $23.6 million, driven by strong wholesale growth and e-commerce subscription revenue. Gross profit also increased by 19%, with gross margin remaining flat. Operating loss significantly decreased by 57%, and net loss improved by 59% compared to the prior year period YTD Financial Performance Comparison ($, %, pts) | Metric | YTD 2025 | YTD 2024 | Change ($) | Change (%) | | :-------------------------- | :---------- | :---------- | :--------- | :--------- | | Sales, net | $23,645,001 | $19,912,592 | $3,732,409 | 19% | | Cost of goods sold | $(13,982,458) | $(11,771,210) | $(2,211,248) | 19% | | Gross profit | $9,662,543 | $8,141,382 | $1,521,161 | 19% | | Gross margin | 40.9% | 40.9% | | 0% | | Total operating expenses | $10,280,039 | $9,568,565 | $711,474 | 7% | | Operating loss | $(617,496) | $(1,427,183) | $809,687 | (57)% | | Net loss | $(518,360) | $(1,255,598) | $737,238 | (59)% | - The **19% increase in net sales** was driven by a **40% increase in wholesale channel sales** and a **4% increase in e-commerce sales**, fueled by subscription and repeat customer revenue[128](index=128&type=chunk) - Gross margin remained **flat at 40.9%** for YTD 2025 compared to YTD 2024[130](index=130&type=chunk) - General and administrative expenses increased by **3%** due to stock-based compensation and personnel costs, while sales and marketing expenses increased by **11%** due to higher selling costs[131](index=131&type=chunk)[132](index=132&type=chunk) [Cash Flows](index=31&type=section&id=Cash%20Flows) This section analyzes the Company's cash generation and usage from operating, investing, and financing activities Cash Flow Activities Summary ($) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------- | :----------------------------- | :----------------------------- | | Operating activities | $(4,102,366) | $220,414 | | Investing activities | $(80,638) | $(13,462) | | Financing activities | $(146,373) | $(86,066) | | Net change in cash | $(4,329,377) | $120,886 | - The significant increase in cash used in operating activities for YTD 2025 was due to strategic investment in working capital, including increased inventory to meet demand and address potential tariffs, and elevated accounts receivable[134](index=134&type=chunk) - Cash used in investing activities increased due to purchases of long-lived capital assets, and cash used in financing activities was primarily for payroll taxes related to stock awards, partially offset by stock option exercises[135](index=135&type=chunk) [Liquidity and Capital Resources](index=31&type=section&id=Liquidity%20and%20Capital%20Resources) This section assesses the Company's ability to meet its short-term and long-term financial obligations and fund future operations - As of June 30, 2025, the Company had an accumulated deficit of **$108.6 million** and **$4.2 million cash-on-hand**, with total net working capital of **$12.3 million**[136](index=136&type=chunk)[137](index=137&type=chunk) - The Company believes existing cash and anticipated cash flow from operations will be sufficient for the next twelve months, but may seek additional financing through debt or equity, which could result in dilution or other restrictions[140](index=140&type=chunk) - Macroeconomic trends like commodity cost inflation and potential tariffs, particularly from Southeast Asia, are being monitored, with additional inventory acquired in anticipation of future tariff implementations, impacting current cash balances but not expected to materially affect 2025 cash balances[139](index=139&type=chunk) [Segment Information](index=32&type=section&id=Segment%20Information) This section confirms the Company's single operating segment and how management evaluates its performance - The Company operates as **one operating and reportable segment**, with the CEO reviewing financial information on an aggregate basis for resource allocation and performance evaluation[141](index=141&type=chunk) [Critical Accounting Estimates](index=32&type=section&id=Critical%20Accounting%20Estimates) This section addresses the significant accounting judgments and estimates that impact the Company's financial statements - There have been **no material changes** to the Company's critical accounting estimates since the 2024 Form 10-K[142](index=142&type=chunk) [Emerging Growth Company Status](index=33&type=section&id=Emerging%20Growth%20Company%20Status) This section explains the Company's status as an emerging growth company and the associated reporting flexibilities - The Company qualifies as an **'emerging growth company'** under the JOBS Act, allowing it to take advantage of reduced reporting burdens, such as fewer years of audited financial statements and an exemption from auditor attestation on internal controls[144](index=144&type=chunk)[147](index=147&type=chunk) - The Company has elected to use the extended transition period for complying with new or revised accounting standards, delaying adoption until they apply to private companies[145](index=145&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=33&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section states that there are no quantitative and qualitative disclosures about market risk applicable to the Company for the reported period - This section is marked as **'Not Applicable,'** indicating no material quantitative and qualitative disclosures about market risk for the period[146](index=146&type=chunk) [Item 4. Controls and Procedures](index=33&type=section&id=Item%204.%20Controls%20and%20Procedures) This section discusses the limitations and effectiveness of the Company's disclosure controls and procedures, concluding that they were effective as of June 30, 2025, with no material changes in internal control over financial reporting - Management acknowledges that controls and procedures provide only **reasonable assurance** due to inherent limitations and resource constraints[148](index=148&type=chunk) - The CEO and CFO evaluated the effectiveness of disclosure controls and procedures as of June 30, 2025, and concluded they were **effective**[149](index=149&type=chunk) - There have been **no material changes** in internal control over financial reporting during the quarter ended June 30, 2025[150](index=150&type=chunk) Part II. Other Information [Item 1. Legal Proceedings](index=34&type=section&id=Item%201.%20Legal%20Proceedings) This section states that there are no material pending legal proceedings against the Company - The Company is **not aware of any material pending legal proceedings** to which it is a party or of which its property is the subject[152](index=152&type=chunk) [Item 1A. Risk Factors](index=34&type=section&id=Item%201A.%20Risk%20Factors) This section highlights risks associated with conducting business operations outside of the U.S., including compliance with international laws, tariffs, trade policies, and economic instability, which could adversely affect the Company's business and results of operations - **No material changes** to the Risk Factors disclosed in the 2024 Form 10-K, except for specific risks related to international operations[153](index=153&type=chunk) - Risks of international operations include difficulties with foreign operations, compliance with various laws, changes in foreign regulations, tariffs, export/import restrictions, currency fluctuations, and economic/political instability in regions like Southeast Asia[154](index=154&type=chunk)[158](index=158&type=chunk) - U.S. government-announced tariffs, particularly against countries in Southeast Asia, could lead to inflationary pressures and higher costs for raw materials, with the ultimate impact depending on the magnitude and duration of these policies[157](index=157&type=chunk)[159](index=159&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=36&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section states that there were no unregistered sales of equity securities or use of proceeds to report - There were **no unregistered sales of equity securities** or use of proceeds during the period[161](index=161&type=chunk) [Item 3. Defaults Upon Senior Securities](index=36&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section indicates that there were no defaults upon senior securities - There were **no defaults upon senior securities** during the period[162](index=162&type=chunk) [Item 4. Mine Safety Disclosures](index=36&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section states that mine safety disclosures are not applicable to the Company - This section is marked as **'Not Applicable,'** indicating no mine safety disclosures for the Company[163](index=163&type=chunk) [Item 5. Other Information](index=36&type=section&id=Item%205.%20Other%20Information) This section reports that no directors or executive officers adopted, modified, or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the six months ended June 30, 2025 - No directors or executive officers adopted, modified, or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the six months ended June 30, 2025[164](index=164&type=chunk) [Item 6. Exhibits](index=37&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including certifications from the CEO and CFO, and Inline XBRL documents - Exhibits include certifications from the Chief Executive Officer and Chief Financial Officer (Exhibits 31.1, 31.2, 32.1, 32.2) and various Inline XBRL documents (Exhibits 101.INS, 101.SCH, 101.CAL, 101.DEF, 101.LAB, 101.PRE, 104)[167](index=167&type=chunk) [Signatures](index=38&type=section&id=Signatures) This section formally certifies the report's submission with the authorized signatures of the Company's executive officers - The report was signed by Jason Vieth, President and Chief Executive Officer, and Anya Hamill, Chief Financial Officer, on August 6, 2025[170](index=170&type=chunk)

Core Insights - Laird Superfood has launched Perform Whole Bean Coffee and Perform Decaf Coffee, targeting premium coffee consumers and the growing demand for clean, adaptogenic beverages [1][2][4] - The new products incorporate functional mushrooms such as chaga, lion's mane, maitake, and cordyceps, which are known to promote energy, focus, and overall balance [2][3][4] - The Perform Whole Bean Coffee is the brand's first functional whole bean offering, featuring Aquamin™, a calcified sea algae that provides 72 trace minerals [4][5] - The Perform Decaf Coffee is decaffeinated using the Swiss Water® Process, which removes 99.9% of caffeine while maintaining the coffee's rich flavor [5] Product Details - Both Perform Whole Bean and Perform Decaf Coffee are USDA Organic, shade-grown at high altitudes, and hand-picked, ensuring a smooth and rich flavor experience [3][4] - The new mushroom coffees are available in 12-ounce bags priced at $20, with plans for distribution through select retailers and Amazon [6] Company Background - Laird Superfood was founded in 2015 by Laird Hamilton, a big wave surfer, and has expanded its product line from superfood creamers to include instant lattes, coffees, bars, and prebiotic daily greens [7] - The brand focuses on minimally processed foods and simple ingredients to support active lifestyles and overall well-being [7]

Core Insights - Laird Superfood has launched a new product, the Protein Instant Latte, which combines convenience with nutritional benefits, featuring 10 grams of protein per serving from a blend of plant-based sources [1][2][3] - The product is designed to meet the growing consumer demand for protein-rich foods and offers additional benefits from functional mushroom extracts [2][3] - The Protein Instant Latte is priced at approximately $19 for a bag containing 6 servings, making it a cost-effective alternative to traditional coffee shop lattes [2][4] Company Overview - Laird Superfood, founded in 2015 by surfer Laird Hamilton, focuses on minimally processed superfood products aimed at enhancing energy and overall well-being [5] - The brand has expanded its product line from superfood creamers to include instant lattes, coffees, bars, and prebiotic greens, all made with simple ingredients [5] - The company emphasizes a commitment to clean, real food ingredients that support active lifestyles [5]

Core Insights - Laird Superfood has partnered with Bluestone Lane to introduce iced coffee drinks made with functional mushrooms at over 50 locations in the U.S. [1][4] - The new products include Laird Superfood Latte and Laird Superfood Mocha, designed to optimize energy and support wellness [2][4]. Company Overview - Laird Superfood, founded in 2015 by Laird Hamilton, focuses on minimally processed superfood products that enhance energy and overall well-being [6]. - Bluestone Lane is an Australian-inspired coffee chain known for its premium coffee and hospitality, recognized as one of Inc. 5000's fastest-growing private companies [7][8]. Product Details - The Laird Superfood Latte combines espresso with a functional creamer containing organic mushroom extracts like Chaga, Lion's Mane, Maitake, and Cordyceps [2]. - The Laird Superfood Mocha features a new creamer specifically developed for this drink, also incorporating functional mushrooms [2]. Pricing and Availability - The Laird Superfood Latte is priced at $7.45, while the Laird Superfood Mocha is priced at $7.95, available at all Bluestone Lane locations [4].

Financial Data and Key Metrics Changes - In Q1 2025, the company achieved an 18% year-over-year increase in net sales to $11.7 million, up from $9.9 million in the same period last year, marking the fifth consecutive quarter of double-digit sales growth [5][13] - The gross margin for Q1 2025 was 41.9%, a 1.9 percentage point improvement compared to Q1 2024, despite commodity price pressures [6][14] - The net loss narrowed to $200,000 in Q1 2025 from a $1 million loss in Q1 2024, and adjusted EBITDA was positive at $400,000 compared to a negative $800,000 in the prior year [11][16] Business Line Data and Key Metrics Changes - The wholesale channel led growth with a 35% year-over-year increase, now accounting for nearly half of total revenue [7][13] - E-commerce sales grew by 6% year-over-year, contributing 53% of total net sales, driven by strong performance on Amazon [6][14] - Direct-to-consumer sales saw over 75% coming from repeat customers and subscribers, indicating strong customer loyalty [7] Market Data and Key Metrics Changes - The company experienced distribution gains in grocery and club stores, which contributed to the significant growth in the wholesale channel [8][13] - Improved inventory management and targeted marketing execution on Amazon drove platform demand for layered superfood products [6][14] Company Strategy and Development Direction - The company aims to maintain annual gross margins in the upper 30s while prioritizing volume growth to build a larger, more profitable business [10] - The strategic focus remains on driving growth through Amazon and expanding wholesale distribution, with a target of a 50-50 split between wholesale and e-commerce by 2025 [31] - The company is committed to operational efficiencies and strategic sourcing to mitigate the impact of commodity price inflation and tariffs [9][10] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about potential commodity price corrections in 2025 that could enhance profitability [10] - The company reaffirmed its full-year guidance, expecting net sales between $52 million and $54 million, representing 20% to 25% growth versus the prior year [19][18] - Management remains confident in the company's ability to deliver long-term value for shareholders despite current industry headwinds [20] Other Important Information - The company ended the quarter with $7.2 million in cash and no debt, indicating a strong balance sheet [17] - The company invested in building inventory safety stock to minimize out-of-stock issues and capture future growth opportunities [17] Q&A Session Summary Question: Clarification on tariffs and their impact on trade spend - Management indicated that the current 10% tariff is manageable, but future tariffs could have a more significant impact, which they believe they can accommodate within their financial guidance [25][26] Question: Details on wholesale strength and promotional spend - Management highlighted strong growth in coffee and instant latte products, with improved velocities and distribution gains contributing to wholesale growth [32][36] Question: Performance of the new liquid creamer product - Management noted that velocities are coming in as expected, with some challenges due to inventory transitions, but overall confidence remains high for future performance [39][40] Question: Marketplace strategy and its impact on core product innovation - Management clarified that the marketplace is a supportive component of the DTC platform, aimed at enhancing customer engagement rather than generating significant revenue [50][51] Question: Impact of Palisade fires on sales - Management reported no noticeable negative impact on sales from the Palisade fires, although they provided support to first responders [55]

Financial Data and Key Metrics Changes - In Q1 2025, the company achieved an 18% year-over-year increase in net sales to $11.7 million, up from $9.9 million in the same period last year, marking the fifth consecutive quarter of double-digit sales growth [4][12] - The gross margin for Q1 2025 was 41.9%, a 1.9 percentage point improvement compared to Q1 2024, despite commodity price pressures [5][13] - The net loss narrowed to $200,000 in Q1 2025 from a $1 million loss in Q1 2024, and adjusted EBITDA was positive at $400,000 compared to a negative $800,000 in the prior year [10][14] Business Line Data and Key Metrics Changes - The wholesale channel led growth with a 35% year-over-year increase, now accounting for nearly half of total net sales [6][12] - E-commerce sales grew by 6% year-over-year, contributing 53% of total net sales, driven by strong performance on Amazon [5][13] - Direct-to-consumer sales saw over 75% coming from repeat customers and subscribers, indicating strong customer loyalty [6] Market Data and Key Metrics Changes - The company reported significant distribution gains in grocery and club stores, contributing to the wholesale growth [6][12] - The company is optimistic about resolving supply chain constraints and expects to drive accelerated growth in coconut milk products in the second half of 2025 [7][10] Company Strategy and Development Direction - The company aims to maintain annual gross margins in the upper 30s while prioritizing volume growth to build a larger, more profitable business [9] - The strategy focuses on robust growth on Amazon and expanding wholesale distribution, with a target of a 50-50 split between wholesale and e-commerce by 2025 [30] - The company is committed to operational efficiencies and strategic sourcing to mitigate rising commodity costs and tariffs [8][9] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about potential commodity price corrections in 2025 that could enhance profitability [9] - The company remains confident in its 2025 outlook and ability to deliver long-term value for shareholders despite current industry headwinds [19][20] - Management highlighted the importance of maintaining strong supplier relationships and operational efficiencies to navigate inflationary pressures [8][14] Other Important Information - The company ended the quarter with $7.2 million in cash and no debt, indicating a strong balance sheet [15] - The company is investing in building inventory safety stock to minimize out-of-stock issues and capture future growth opportunities [15][17] - Full-year guidance expects net sales between $52 million and $54 million, representing 20% to 25% growth versus the prior year [18] Q&A Session Summary Question: Clarification on tariffs and their impact - Management indicated that the current 10% tariff is manageable, but future tariffs could have a more significant impact, which they believe they can accommodate within their financial guidance [24][25] Question: Details on wholesale strength and promotional spend - Management noted that wholesale growth is driven by distribution gains and improved velocities, particularly in coffee and instant latte products, with promotional spending being efficient despite exceeding expectations [30][36] Question: Performance of the new liquid creamer product - Management reported that velocities for the new liquid creamer are in line with expectations, although the transition has been challenging due to timing issues with major accounts [39][40] Question: Marketplace strategy and its impact - The marketplace is a non-strategic component aimed at enhancing the DTC platform by offering lifestyle products, which helps drive traffic and retention without significant financial expectations [48][49] Question: Impact of Palisade fires on sales - Management stated that while there was displacement in Southern California, there was no noticeable negative impact on sales, and they provided support to first responders as a goodwill gesture [52][53]

Financial Performance - The net loss for the three months ended March 31, 2025, was $156,182, compared to a net loss of $1,016,522 for the same period in 2024, resulting in a basic and diluted loss per share of $0.02[77]. - Adjusted EBITDA for Q1 2025 was $356,912, compared to a negative $748,757 in Q1 2024, indicating improved operational performance[96]. - The company reported a consolidated net loss of $156,182 for Q1 2025, significantly improved from a loss of $1,016,522 in Q1 2024[96]. Revenue and Sales - Gross sales for the three months ended March 31, 2025, were $13,542,133, an increase from $11,196,930 in the same period of 2024, with net sales of $11,654,159[88]. - E-commerce revenue for Q1 2025 was $6,213,116, accounting for 53% of total sales, compared to $5,868,337 (59%) in Q1 2024[90]. - Wholesale revenue increased to $5,441,043 (47% of total sales) in Q1 2025 from $4,040,601 (41%) in Q1 2024[90]. - Total net sales for Q1 2025 reached $11,654,159, a 17.7% increase from $9,908,938 in Q1 2024[90]. - Coffee creamers accounted for 58% of total sales in Q1 2025, generating $6,712,651, compared to 56% and $5,570,321 in Q1 2024[88]. Inventory and Assets - Total inventory increased to $9,511,964 as of March 31, 2025, compared to $5,975,676 as of December 31, 2024, reflecting a growth of approximately 59.5%[35]. - The company recorded inventory obsolescence and disposal costs of $101,715 for the three months ended March 31, 2025, compared to $43,204 for the same period in 2024, indicating an increase of approximately 135.5%[38]. - The company had total inventory reserves of $512,751 as of March 31, 2025, compared to $425,792 as of December 31, 2024, indicating an increase of approximately 20.4%[39]. - Total intangible assets decreased to $983,168 as of March 31, 2025, from $1,028,223 as of December 31, 2024, reflecting a decline of approximately 4.4%[43]. Cash and Expenses - As of March 31, 2025, total cash, cash equivalents, and restricted cash amounted to $7,163,362, a decrease from $8,514,152 as of December 31, 2024, representing a decline of approximately 15.9%[33]. - Accrued expenses rose to $4,691,904 as of March 31, 2025, up from $3,642,998 as of December 31, 2024, marking an increase of approximately 28.8%[47]. - The company reported depreciation expense of $21,466 for the three months ended March 31, 2025, compared to $19,714 for the same period in 2024, which is an increase of approximately 8.9%[41]. - The company incurred $66,521 in depreciation and amortization expenses in Q1 2025, slightly down from $71,435 in Q1 2024[96]. - The company’s operating lease expense for the three months ended March 31, 2025, was $116,809, compared to $107,879 for the same period in 2024, representing an increase of approximately 8.9%[49]. Tax and Deferred Assets - The company reported an income tax benefit at statutory rates of $20,511 for the three months ended March 31, 2025, compared to $205,289 for the same period in 2024, resulting in an effective tax rate of 8.8%[52]. - The total net deferred tax assets as of March 31, 2025, were $0, with a valuation allowance of $26,379,645 against deferred tax assets[52]. - The company has total net operating losses (NOLs) of $146,334,753 as of March 31, 2025, compared to $145,553,779 as of December 31, 2024[55]. Stock and Compensation - The total intrinsic value of options that vested during the three months ended March 31, 2025, was $844,561, while the total intrinsic value of options exercised was $118,010[64]. - The total fair value of outstanding restricted stock units (RSUs) as of March 31, 2025, was $5,939,602, based on a closing price of $6.15[68]. - The company had 1,265,041 authorized shares available for issuance under the stock incentive plan as of March 31, 2025[63]. - Total stock-based compensation for the three months ended March 31, 2025, was $508,410, with unrecognized compensation cost related to non-vested awards amounting to $3,575,861[75]. - Stock-based compensation expenses increased to $508,410 in Q1 2025 from $279,565 in Q1 2024[96]. Customer and Vendor Concentration - The company had a concentration of customer accounts receivable, with Customer A representing 40% and Customer B 29% of total trade accounts receivable as of March 31, 2025[79]. - The concentration of vendor accounts payable balances in excess of 10% of total accounts payable was 50% as of March 31, 2025, compared to 42% as of December 31, 2024[78]. Other Information - The average remaining vesting period for stock options as of March 31, 2025, was 2.61 years, while for RSUs, it was 3.44 years[75]. - The company did not grant any stock options or RSUs during the three months ended March 31, 2025[68]. - No Market-Based Stock Units (MSUs) were outstanding during the three months ended March 31, 2025, and the total vest date market value of MSUs vested during the three months ended March 31, 2024, was $260,000[72]. - The company does not have intra-entity sales or transfers, focusing solely on domestic product sales in its superfood segment[93].

[First Quarter 2025 Financial Highlights](index=1&type=section&id=First%20Quarter%202025%20Financial%20Highlights) This section highlights Laird Superfood's strong Q1 2025 performance, including double-digit sales growth, improved profitability, and positive Adjusted EBITDA [CEO Commentary and Performance Summary](index=1&type=section&id=CEO%20Commentary%20and%20Performance%20Summary) In Q1 2025, Laird Superfood achieved its fifth consecutive quarter of double-digit year-over-year sales growth, with net sales increasing by 18% to $11.7 million, driven by strategic expansion and improved operational leverage - The company reported its **fifth consecutive quarter of double-digit year-over-year sales growth**, driven by expansion into brick-and-mortar stores and Amazon[3](index=3&type=chunk) - Successfully resolved inventory and supply chain constraints that impacted the business at the end of 2024, building a more flexible supply chain in the process[3](index=3&type=chunk) Q1 2025 Key Financial Metrics | Metric | Q1 2025 | Q1 2024 | Change | Q4 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Sales ($M) | $11.7M | $9.9M | +18% YoY | $11.6M | | Gross Margin (%) | 41.9% | 40.0% | +1.9 p.p. YoY | 38.6% | | Net Loss ($M) | ($0.2M) | ($1.0M) | +$0.8M YoY | ($0.4M) | | Net Loss per Share ($) | ($0.02) | ($0.11) | +$0.09 YoY | ($0.04) | | Adjusted EBITDA ($M) | $0.4M | ($0.7M) | +$1.1M YoY | $0.2M | - Wholesale sales grew **35% year-over-year**, contributing **47%** of total net sales, while E-commerce sales increased **6%**, contributing **53%** of total net sales[5](index=5&type=chunk) [Detailed Financial Results](index=2&type=section&id=Detailed%20Financial%20Results) This section provides a detailed breakdown of Q1 2025 financial results, including revenue by product and channel, balance sheet positions, and cash flow activities [Revenue Disaggregation](index=2&type=section&id=Revenue%20Disaggregation) In Q1 2025, total net sales reached $11.65 million, with coffee creamers as the largest product category and wholesale sales significantly growing to 47% of net sales Revenue by Product Category (Three Months Ended March 31) | Product Category | 2025 Gross Sales ($) | % of Total | 2024 Gross Sales ($) | % of Total | | :--- | :--- | :--- | :--- | :--- | | Coffee creamers | $6,712,651 | 58% | $5,570,321 | 56% | | Coffee, tea, and hot chocolate | $3,220,892 | 28% | $2,175,265 | 22% | | Hydration and beverage enhancing | $2,106,179 | 18% | $2,025,272 | 20% | | Snacks and other food items | $1,430,729 | 12% | $1,304,060 | 13% | Revenue by Sales Channel (Three Months Ended March 31) | Sales Channel | 2025 Net Sales ($) | % of Total | 2024 Net Sales ($) | % of Total | | :--- | :--- | :--- | :--- | :--- | | E-commerce | $6,213,116 | 53% | $5,868,337 | 59% | | Wholesale | $5,441,043 | 47% | $4,040,601 | 41% | | **Total Sales, net** | **$11,654,159** | **100%** | **$9,908,938** | **100%** | [Balance Sheet and Cash Flow Highlights](index=3&type=section&id=Balance%20Sheet%20and%20Cash%20Flow%20Highlights) As of March 31, 2025, the company held $7.2 million in cash and equivalents with no outstanding debt, while cash used in operating activities increased to $1.3 million due to strategic inventory investment - The company had **$7.2 million** of cash, cash equivalents, and restricted cash as of March 31, 2025, with **no outstanding debt**[7](index=7&type=chunk) - Cash used in operating activities increased to **$1.3 million** in Q1 2025 from **$0.4 million** in Q1 2024, driven by a **strategic investment in working capital** to meet high demand and address previous out-of-stock issues[8](index=8&type=chunk) [2025 Outlook](index=3&type=section&id=2025%20Outlook) This section outlines Laird Superfood's reaffirmed full-year 2025 guidance, including projected sales growth, gross margin, and Adjusted EBITDA targets [Full Year 2025 Guidance](index=3&type=section&id=Full%20Year%202025%20Guidance) Management has reaffirmed its full-year 2025 guidance, projecting strong growth with net sales increasing between 20% and 25%, gross margin in the upper 30s, and breakeven adjusted EBITDA - Re-affirms Net Sales growth guidance in the **20% to 25%** range for the full year 2025[11](index=11&type=chunk) - Expects Gross Margin to hold in the **upper 30s** for the full year[11](index=11&type=chunk) - Targets **breakeven adjusted EBITDA** for the full year[11](index=11&type=chunk) - Anticipates using **$1 to $2 million** in cash for the full year to invest in inventory, supporting top-line growth and minimizing out-of-stocks[11](index=11&type=chunk) [Consolidated Financial Statements (Unaudited)](index=5&type=section&id=LAIRD%20SUPERFOOD%2C%20INC.%20CONSOLIDATED%20STATEMENTS) This section presents the unaudited consolidated financial statements for Q1 2025, including statements of operations, cash flows, and balance sheets [Consolidated Statements of Operations](index=5&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) For the first quarter of 2025, Laird Superfood reported increased net sales and gross profit, significantly reducing its operating and net losses year-over-year Q1 2025 vs Q1 2024 Statement of Operations Summary | Metric | Three Months Ended March 31, 2025 ($) | Three Months Ended March 31, 2024 ($) | | :--- | :--- | :--- | | Sales, net | $11,654,159 | $9,908,938 | | Gross profit | $4,881,540 | $3,964,101 | | Total operating expenses | $5,099,559 | $5,052,663 | | Operating loss | ($218,019) | ($1,088,562) | | Net loss | ($156,182) | ($1,016,522) | | Net loss per share | ($0.02) | ($0.11) | [Consolidated Statements of Cash Flows](index=6&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) For Q1 2025, net cash used in operating activities increased to $1.27 million, primarily due to a $3.64 million strategic investment in inventory, with cash and equivalents ending at $7.16 million - Net cash used in operating activities was **$1,274,744** for Q1 2025, compared to **$422,311** in Q1 2024[18](index=18&type=chunk) - The primary driver for the increased cash use was a **$3,638,003 increase in inventory**, reflecting a strategic build-up to support sales growth[18](index=18&type=chunk) - The ending balance of cash, cash equivalents, and restricted cash was **$7,163,362** as of March 31, 2025[18](index=18&type=chunk) [Consolidated Balance Sheets](index=7&type=section&id=CONSOLIDATED%20BALANCE%20SHEETS) As of March 31, 2025, Laird Superfood's total assets increased to $21.5 million, driven by a rise in inventory, while total liabilities also increased, and stockholders' equity remained stable Balance Sheet Summary | Metric | March 31, 2025 ($) | December 31, 2024 ($) | | :--- | :--- | :--- | | Total Current Assets | $20,213,541 | $17,966,628 | | Inventory | $9,511,964 | $5,975,676 | | Total Assets | $21,493,031 | $19,259,001 | | Total Current Liabilities | $8,044,597 | $5,921,671 | | Total Liabilities | $8,162,258 | $6,062,135 | | Total Stockholders' Equity | $13,330,773 | $13,196,866 | [Non-GAAP Financial Measures](index=8&type=section&id=NON-GAAP%20FINANCIAL%20MEASURES) This section provides a reconciliation of the company's GAAP net loss to its non-GAAP Adjusted EBITDA for Q1 2025 [Reconciliation of Net Loss to Adjusted EBITDA](index=8&type=section&id=Reconciliation%20of%20Net%20Loss%20to%20Adjusted%20EBITDA) For Q1 2025, the company reported a Net Loss of $156,182, which adjusted to a positive Adjusted EBITDA of $356,912, a significant turnaround from the prior year's negative Adjusted EBITDA - Adjusted EBITDA is defined as net income (loss) adjusted for interest, taxes, depreciation, amortization, stock-based compensation, and certain non-recurring items[22](index=22&type=chunk) Reconciliation of Net Loss to Adjusted EBITDA (Three Months Ended March 31) | Metric | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Net loss | $(156,182) | $(1,016,522) | | Stock-based compensation | $508,410 | $279,565 | | Depreciation and amortization | $66,521 | $71,435 | | Other adjustments | $(61,837) | $(72,040) | | **Adjusted EBITDA** | **$356,912** | **$(748,757)** | Adjusted EBITDA per Diluted Share | Metric | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Adjusted EBITDA per share, diluted | $0.03 | $(0.08) |

Core Insights - Laird Superfood has launched a new Vanilla Instant Latte featuring real vanilla bean powder, differentiating it from competitors that typically use artificial flavors [1][2] - The product is designed to provide a convenient coffee shop experience at home, requiring only hot water for preparation [3] - The Vanilla Instant Latte includes a Performance Mushroom Blend for energy benefits and Aquamin™, a multi-mineral sea algae complex, which offers over 72 trace minerals including calcium [3] Product Details - The Vanilla Instant Latte is available in an eight-ounce bag on LairdSuperfood.com, with plans for distribution through Amazon and other retailers [5] - The product aims to cater to health-conscious consumers by avoiding sugary syrups and artificial ingredients, focusing instead on authentic flavors [4] Company Background - Laird Superfood was founded in 2015 by Laird Hamilton and Gabby Reece, focusing on minimally processed superfood products that support active lifestyles [6] - The brand has expanded its product line from superfood creamers to include instant lattes, coffees, bars, and prebiotic daily greens [6]