Laird Superfood(LSF) - 2025 Q2 - Quarterly Results

Executive Summary Q2 2025 Performance Overview Laird Superfood reported strong Q2 2025 results, achieving 20% net sales growth and a 39.9% gross margin, re-affirming full-year 2025 guidance - Net Sales grew 20% year-over-year[1] - Gross Margin was 39.9%[1] - Re-affirms 2025 full year guidance[1] CEO Commentary The CEO highlighted 20% net sales growth and 40% gross margin in Q2, driven by nearly 50% wholesale business expansion, with continued investment in brand growth - Net sales growth of 20% year-over-year[2] - Wholesale business grew by nearly 50% year-over-year, contributing significantly to total net sales[2] - Achieved approximately 40% gross margin despite tariff pressures and a challenging consumer and economic environment[2] - Company plans to continue investing in brand growth[2] Financial Highlights Second Quarter 2025 Highlights Q2 2025 net sales grew 20% to $12.0 million, wholesale up 47%, gross margin at 39.9%, net loss of $0.4 million, and Adjusted EBITDA positive at $0.1 million Q2 2025 Key Financial Metrics | Metric | Q2 2025 | Q2 2024 | Q1 2025 | YoY Change | | :----- | :------ | :------ | :------ | :--------- | | Net Sales | $12.0 million | $10.0 million | $11.7 million | +20% | | Wholesale Sales | | | | +47% | | E-commerce Sales | | | | +2% | | Gross Margin | 39.9% | 41.8% | 41.9% | -1.9 pp | | Net Loss | $0.4 million | $0.2 million | $0.2 million | +$0.2 million | | Net Loss per diluted share | $0.03 | $0.02 | $0.02 | +$0.01 | | Adjusted EBITDA | $0.1 million | ($0.1) million | $0.4 million | +$0.2 million | | Adjusted EBITDA per diluted share | $0.01 | ($0.01) | $0.03 | +$0.02 | - Gross margin compression relative to the prior year period was primarily due to increased promotional trade spend, commodity cost inflation, and channel mix[5] - The increase in Net Loss relative to the prior year period was driven primarily by higher marketing investment, higher selling costs on top-line sales, and personnel costs related to stock-based compensation[5] Year-to-Date 2025 Highlights YTD 2025 net sales reached $23.6 million (up 18.6%), wholesale sales up 41%, gross margin relatively flat, net loss improved to $0.5 million, and Adjusted EBITDA positive at $0.5 million YTD 2025 Key Financial Metrics | Metric | YTD 2025 | YTD 2024 | YoY Change | | :----- | :------- | :------- | :--------- | | Net Sales | $23.6 million | $19.9 million | +18.6% | | Wholesale Sales | | | +41% | | E-commerce Sales | | | +4% | | Gross Margin | Relatively flat | | | | Net Loss | $0.5 million | $1.3 million | -$0.8 million (improvement) | | Net Loss per diluted share | $0.05 | $0.13 | -$0.08 (improvement) | | Adjusted EBITDA | $0.5 million | ($0.8) million | +$1.3 million (improvement) | | Adjusted EBITDA per diluted share | $0.04 | ($0.08) | +$0.12 (improvement) | - The improvement in Net Loss was driven by top-line sales growth, partially offset by higher selling costs on increased top line sales and personnel costs related to stock-based compensation[5][6] Detailed Financial Statements Revenue Disaggregation Laird Superfood's Q2 and YTD 2025 revenue disaggregation shows growth in coffee creamers and coffee/tea, declines in hydration and snacks, and a significant increase in Wholesale channel share By Product Category Q2 2025 Revenue by Product Category | Product Category | Q2 2025 Sales ($) | % of Total (Q2 2025) | Q2 2024 Sales ($) | % of Total (Q2 2024) | | :--------------- | :---------------- | :------------------- | :---------------- | :------------------- | | Coffee creamers | 6,770,922 | 56% | 4,696,979 | 47% | | Coffee, tea, and hot chocolate products | 3,599,037 | 30% | 2,503,529 | 25% | | Hydration and beverage enhancing products | 1,824,025 | 15% | 2,309,600 | 23% | | Snacks and other food items | 1,412,979 | 12% | 1,683,776 | 17% | | Other | 71,635 | 1% | 91,909 | 1% | | Sales, net | 11,990,842 | 100% | 10,003,654 | 100% | YTD 2025 Revenue by Product Category | Product Category | YTD 2025 Sales ($) | % of Total (YTD 2025) | YTD 2024 Sales ($) | % of Total (YTD 2024) | | :--------------- | :----------------- | :-------------------- | :----------------- | :-------------------- | | Coffee creamers | 13,483,574 | 57% | 10,267,299 | 52% | | Coffee, tea, and hot chocolate products | 6,819,928 | 29% | 4,678,794 | 23% | | Hydration and beverage enhancing products | 3,930,204 | 17% | 4,334,872 | 22% | | Snacks and other food items | 2,843,707 | 12% | 2,987,837 | 15% | | Other | 143,318 | 1% | 213,921 | 1% | | Sales, net | 23,645,001 | 101% | 19,912,592 | 100% | By Sales Channel Q2 2025 Revenue by Sales Channel | Sales Channel | Q2 2025 Sales ($) | % of Total (Q2 2025) | Q2 2024 Sales ($) | % of Total (Q2 2024) | | :------------ | :---------------- | :------------------- | :---------------- | :------------------- | | E-commerce | 6,237,344 | 52% | 6,098,327 | 61% | | Wholesale | 5,753,498 | 48% | 3,905,327 | 39% | | Sales, net | 11,990,842 | 100% | 10,003,654 | 100% | YTD 2025 Revenue by Sales Channel | Sales Channel | YTD 2025 Sales ($) | % of Total (YTD 2025) | YTD 2024 Sales ($) | % of Total (YTD 2024) | | :------------ | :----------------- | :-------------------- | :----------------- | :-------------------- | | E-commerce | 12,450,460 | 53% | 11,966,664 | 60% | | Wholesale | 11,194,541 | 47% | 7,945,928 | 40% | | Sales, net | 23,645,001 | 101% | 19,912,592 | 100% | Balance Sheet and Cash Flow Highlights As of June 30, 2025, Laird Superfood held $4.2 million in cash with no outstanding debt, while cash used in operating activities increased to $4.1 million due to strategic inventory and raw material purchases - Cash, cash equivalents, and restricted cash totaled $4.2 million as of June 30, 2025, with no outstanding debt[8] YTD Cash Flow from Operating Activities | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change | | :----- | :----------------------------- | :----------------------------- | :----- | | Cash from Operating Activities | ($4.1) million | $0.2 million | Used $4.3 million more | - The increase in cash used in operating activities was driven by strategic investments to bolster inventory to meet high demand and to forward purchase raw materials to mitigate anticipated tariff costs[9] - Company intends to normalize cash usage in the upcoming quarters as inventory is converted into cash[9] Consolidated Statements of Operations Laird Superfood reported net sales of $11.99 million for Q2 2025 and $23.65 million for YTD 2025, with gross profit increasing, but Q2 operating and net losses widening, while YTD net loss significantly improved Consolidated Statements of Operations Summary | Metric | Q2 2025 ($) | Q2 2024 ($) | YTD 2025 ($) | YTD 2024 ($) | | :----- | :---------- | :---------- | :----------- | :----------- | | Sales, net | 11,990,842 | 10,003,654 | 23,645,001 | 19,912,592 | | Cost of goods sold | (7,209,839) | (5,826,373) | (13,982,458) | (11,771,210) | | Gross profit | 4,781,003 | 4,177,281 | 9,662,543 | 8,141,382 | | Total operating expenses | 5,180,480 | 4,515,902 | 10,280,039 | 9,568,565 | | 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 and diluted | (0.03) | (0.02) | (0.05) | (0.13) | Consolidated Statements of Cash Flows For the six months ended June 30, 2025, net cash used in operating activities was $4.1 million, a significant increase primarily due to a substantial rise in inventory, leading to a net decrease in cash and cash equivalents Consolidated Statements of Cash Flows Summary (Six Months Ended June 30) | Cash Flow Activity | 2025 ($) | 2024 ($) | | :----------------- | :------- | :------- | | Net cash from operating activities | (4,102,366) | 220,414 | | Cash flows from investing activities | (80,638) | (13,462) | | Cash flows from financing activities | (146,373) | (86,066) | | Net change in cash and cash equivalents | (4,329,377) | 120,886 | | Cash, cash equivalents, and restricted cash, end of period | 4,184,775 | 7,827,692 | - A significant increase in inventory (from ($263,719) in 2024 to ($5,453,877) in 2025) was the primary driver for the change in net cash from operating activities[20] Consolidated Balance Sheets As of June 30, 2025, total assets increased to $20.43 million from $19.26 million, primarily driven by a substantial increase in inventory, with total liabilities also rising and stockholders' equity seeing a modest increase Consolidated Balance Sheets Summary | Metric | June 30, 2025 ($) | December 31, 2024 ($) | | :----- | :---------------- | :-------------------- | | Total current assets | 19,217,189 | 17,966,628 | | Inventory | 11,027,615 | 5,975,676 | | Total assets | 20,426,736 | 19,259,001 | | Total current liabilities | 6,958,352 | 5,921,671 | | Total liabilities | 7,052,795 | 6,062,135 | | Total stockholders' equity | 13,373,941 | 13,196,866 | - The significant increase in inventory from $5.98 million at December 31, 2024, to $11.03 million at June 30, 2025, was a major factor in the change in total current assets[22] Non-GAAP Financial Measures Adjusted EBITDA Definition and Use Laird Superfood uses Adjusted EBITDA, a non-GAAP measure, to assess financial performance by excluding non-cash and non-recurring items, defined as net income (loss) adjusted for specific expenses, and used internally for operational assessment despite its limitations - Adjusted EBITDA is a non-GAAP financial measure used by management to assess and communicate the Company's financial performance, excluding non-cash costs and non-recurring events[24] - Defined as net income (loss) adjusted to exclude interest expense, income tax, depreciation and amortization, stock-based compensation, and expenses and recoveries related to a product quality issue[24] - Management uses Adjusted EBITDA internally for operational performance assessment and future capital requirements, but it should not be considered in isolation or as a substitute for GAAP financial information due to its limitations[25][26] Adjusted EBITDA Reconciliation The reconciliation shows Q2 2025 Adjusted EBITDA at $0.15 million, a significant improvement from a prior year loss, and YTD 2025 Adjusted EBITDA at $0.51 million, a substantial improvement primarily due to stock-based compensation adjustments and the absence of product quality issue expenses Adjusted EBITDA Reconciliation | Metric | Q2 2025 ($) | Q2 2024 ($) | YTD 2025 ($) | YTD 2024 ($) | | :----- | :---------- | :---------- | :----------- | :----------- | | Net loss | (362,178) | (239,076) | (518,360) | (1,255,598) | | Depreciation and amortization | 59,376 | 67,144 | 125,897 | 138,579 | | Stock-based compensation | 488,576 | 253,708 | 996,986 | 533,273 | | Income tax expense | 8,262 | 3,524 | 20,873 | 42,481 | | Interest expense and other (income) expense, net | (45,561) | (103,069) | (120,009) | (214,066) | | Product quality issue (a) | — | (74,019) | — | (35,213) | | Adjusted EBITDA | 148,475 | (91,788) | 505,387 | (790,544) | | Adjusted EBITDA per share, diluted | 0.01 | (0.01) | 0.04 | (0.08) | - The product quality issue in 2024 involved costs associated with product testing, discounts for replacement orders, and inventory obsolescence, with recoveries recorded in 2024 after a supplier settlement[26] Outlook and Corporate Information 2025 Outlook Laird Superfood re-affirms its full-year 2025 guidance, expecting Net Sales growth of 20% to 25%, Gross Margin in the upper 30s, a GAAP Net Loss, but breakeven Adjusted EBITDA, with approximately $2 million in cash use for inventory - Management re-affirms full year Net Sales growth guidance in the range of 20% to 25%, driven by robust performance in retail outlets and club stores[13] - Gross Margin is re-affirmed to hold in the upper 30s, despite commodity inflation, tariffs, and other cost pressures[13] - On a GAAP basis, the company expects to report a full-year Net Loss, but anticipates breakeven Adjusted EBITDA[13] - Forecasts approximately $2 million in cash use for the full year to bolster inventory to support top-line growth[13] Forward-Looking Statements and Risks The report contains forward-looking statements subject to substantial risks and uncertainties, including global outbreaks, revenue volatility, supply chain, product quality, raw material availability, and adverse economic conditions - Forward-looking statements are based on current assumptions and expectations and are subject to substantial risks, uncertainties, assumptions, and changes in circumstances that may cause actual results to differ materially[14] - Risks include effects of global outbreaks, volatility regarding revenue and expenses, ability to acquire and retain customers, managing suppliers and distributors, product quality issues, innovation challenges, adverse developments regarding raw material prices and availability, changes in consumer preferences, and the impact of adverse economic conditions[15] About Laird Superfood Laird Superfood, Inc. creates award-winning, plant-based superfood products that are clean, delicious, and functional, co-founded in 2015 by Laird Hamilton, with environmentally conscientious and responsibly tested offerings - Laird Superfood, Inc. creates award-winning, plant-based superfood products that are clean, delicious, and functional, designed to enhance a consumer's daily ritual[12] - The company was co-founded in 2015 by Laird Hamilton, and its offerings are environmentally conscientious, responsibly tested, and made with real ingredients[12] Conference Call and Investor Relations Laird Superfood hosted a conference call and webcast on August 6, 2025, to discuss financial results, with the webcast archived online, and investor inquiries directed to Trevor Rousseau - A conference call and webcast were hosted on August 6, 2025, to discuss financial results, with the webcast archived on the Laird Superfood Investor Relations website[11] - The Investor Relations contact is Trevor Rousseau[16]