Core Insights - Natural Alternatives International, Inc. (NAI) reported a net loss of $0.3 million, or $0.05 per diluted share, on net sales of $37.7 million for Q1 FY 2026, an improvement from a net loss of $2.0 million, or $0.33 per diluted share, in the same quarter of the previous fiscal year [1][11]. Financial Performance - Net sales increased by $4.6 million, or 13.8%, to $37.7 million compared to $33.2 million in the same period last year [2]. - Private-label contract manufacturing sales rose by $5.4 million, a 17.7% increase from the prior year, driven by higher orders from existing customers and new customer shipments [2]. - CarnoSyn® beta-alanine royalty, licensing, and raw material sales revenue decreased by 33.9% to $1.7 million, down from $2.5 million in Q1 FY 2025, primarily due to reduced raw material orders from existing customers [3]. Operational Highlights - The company generated income from operations in Q1 FY 2026, contrasting with a loss from operations in Q1 FY 2025, attributed to increased sales and gross profit while maintaining flat selling, general, and administrative expenses [4]. - Gross profit improved due to better factory utilization, increased sales, and lower volume rebates [4]. Cash and Working Capital - As of September 30, 2025, NAI had cash of $7.7 million and working capital of $31.2 million, compared to $12.3 million and $30.5 million, respectively, as of June 30, 2025 [5]. Strategic Outlook - The CEO highlighted that the growth in sales and improved financial results reflect efforts to strengthen existing relationships and expand the customer base, with expectations of returning to profitability in the second half of FY 2026 [6]. - The company is focusing on expanding client relationships and promoting the TriBsyn product, which is positioned to support consumers using GLP-1 medications [6]. Supply Chain Considerations - NAI continues to face supply chain disruptions but is actively working to secure scarce materials in anticipation of sales growth and profitability in the latter half of the fiscal year [7].