Laird Superfood, Inc. Q1 FY2026 earnings call

Transformative Acquisitions & Roll-up Strategy

• Completed two transformative acquisitions in Q1/Q2 2026: Navitas Organics (closed March 12, 2026) and TerraSol Superfoods (closed April 21, 2026), funded by $110 million in total preferred stock issuance from strategic partner Nexus Capital Management, which now holds 73.8% of fully diluted common stock.
• The acquisitions expand product portfolio, broaden distribution reach, strengthen in-house supply chain capabilities, and accelerate the company's strategy to build a scaled diversified positive nutrition platform; management confirms this is the start of an ongoing roll-up strategy, with additional acquisitions planned in coming years.
• Navitas Organics adds a leading premium organic superfood brand with strong multi-channel presence; TerraSol adds a vertically integrated platform of nuts, seeds, powders, and baking ingredients, with in-house sourcing, processing, packaging, and enhanced online marketplace capabilities, plus an existing food service distribution footprint.

Operational Integration

• Navitas has already been fully integrated into Laird's organizational structure, with expected synergies on track, and teams focused on delivering planned COGS, distribution, and brokerage savings by the second half of 2026.
• TerraSol integration is following the same disciplined approach; the facility currently operates at underutilized capacity (one shift only), with long-term room to add additional shifts and production lines, and production of Laird and Navitas products will be transitioned to TerraSol gradually after full Navitas integration is complete.

Organizational Updates

• Andy Judd, a former Laird executive who previously scaled a CPG brand to $500 million in revenue prior to its acquisition by Pepsi, has returned to lead marketing, with a strategic shift to bring more marketing work in-house for improved efficiency, creativity, and speed to market, with near-term ramp-up investment expected to deliver long-term ROI gains.
• A new sales leadership hire to accelerate wholesale growth, particularly in conventional grocery and club channels, will be announced on the next quarterly call.
• Artificial intelligence is deployed company-wide to support forecasting, planning, and execution across supply chain, finance, and marketing, enabling the company to double scale with minimal incremental headcount.

Q1 Core Performance

• All three brands achieved growth well above industry average, with total company growth of 20% year-over-year; supply chain performance remained strong during integration, with near-term margin pressure from legacy high-cost inventory and remaining tariffs expected to abate through 2026 as commodity prices have fallen and tariffs have been removed from most products.

Total net sales for Q1 2026 were $13.9 million, a 20% increase from $11.7 million in Q1 2025. Newly acquired Navitas Organics contributed $1.6 million in net sales during its partial 19-day post-acquisition period in the quarter. The Wholesale segment grew 37% year-over-year to $7.5 million, representing 54% of total net sales, with growth driven by Navitas' wholesale contribution, expanded distribution, and strong in-store performance. The E-commerce segment grew 4% year-over-year to $6.5 million, representing 46% of total net sales, with growth from Navitas' e-commerce contribution and strong Amazon sales offset by softness in Laird's direct-to-consumer channel. Gross margin contracted 8.6 percentage points year-over-year to 33.3% (41.9% in Q1 2025); 3.2 percentage points of contraction came from non-recurring 2025 timing benefits that did not repeat, while 5.4 percentage points came from unfavorable product/channel mix, elevated commodity costs, and remaining import tariffs. Total operating expenses were $7.7 million, up 51% from $5.1 million in Q1 2025, driven primarily by one-time acquisition and integration costs for Navitas. Reported GAAP net income was $1.8 million ($0.12 per basic share), driven by a $4.7 million one-time non-recurring tax benefit from the Navitas acquisition; adjusted EBITDA (which excludes non-recurring items) was a loss of $1.1 million, compared to positive adjusted EBITDA of $0.4 million in Q1 2025. As of March 31, 2026, the company held $10.5 million in total cash and equivalents with no outstanding debt; as of April 30, 2026, post-TerraSol acquisition, the combined company held approximately $24 million in total cash.

• For full-year 2026, consolidated net sales guidance for the combined platform (including Laird Superfood and post-acquisition contributions from Navitas and TerraSol) is $138 million to $148 million.
• Full-year 2026 adjusted EBITDA guidance (excluding one-time transaction and integration costs) is $8 million to $12 million, driven by top-line growth and early synergy realization.
• On a pro forma basis (assuming both acquisitions closed on January 1, 2026), full-year 2026 net sales are expected to grow 8% to 12% year-over-year.
• Gross margins are expected to improve to the low to mid-30% range in the second half of 2026, driven by lower commodity costs, tariff refunds, more favorable product mix, reduced promotional/slotting costs, and the addition of higher-margin TerraSol revenue.
• Full double-digit EBITDA margins are not expected in 2026, as most major synergies (including cost savings from moving production to the TerraSol facility) will be gradually realized starting in late 2026 and continuing into 2027. Management expects to deliver positive adjusted EBITDA and cash flow longer-term as the platform scales.

• Integration of two large acquisitions creates near-term cost pressure, operational complexity, and execution risk; rushed integration could lead to operational disruptions or missed synergy targets.
• Gross margin is under near-term pressure from unfavorable product and channel mix, legacy high commodity cost inventory, and remaining import tariffs, which could pressure near-term profitability.
• The company's acquisitive roll-up strategy depends on accessing debt and equity capital to fund future purchases, availability of attractive acquisition targets at appropriate valuations, and the company's ability to integrate additional acquisitions while maintaining performance of existing brands.
• Resource constraints may slow expansion into new channels such as food service, requiring prioritization of high-opportunity segments in the near term.

Q: Can you expand on the value of TerraSol's vertical integration capabilities and new channel opportunities? / A: Laird Superfood previously shut down its own in-house manufacturing when it was subscale, moving to outsourced production, which improved margins greatly. Now that the combined business has sufficient scale, TerraSol's existing in-house manufacturing and distribution facility adds cost and quality control benefits. The facility currently runs one shift and has significant excess capacity for future growth. TerraSol already has over 3,000 existing food service distribution points that are completely additive to Laird and Navitas' footprint, plus proven omnichannel and Amazon marketplace expertise that will benefit the entire portfolio. Products are complementary to the existing portfolio, with limited crossover, making the combination strongly additive.

Q: What is your expected pacing for future acquisitions? / A: A baseline expectation of one to two acquisitions per year is reasonable, though the pace depends on integration progress and availability of attractive targets. After completing two acquisitions in 2026 already, management would still consider a third attractive acquisition in the 2026 calendar year if it fit the strategy and was priced appropriately. All future targets will be aligned with the health and wellness, minimally processed, close-to-the-earth food positioning of the existing platform.

Q: How will you share best practices and keep communication clear across the three integrated organizations? / A: The combined company remains small and nimble, and heavy AI adoption allows it to double scale with minimal incremental headcount. Navitas employees are already integrated and working side-by-side with the existing Laird team, with clear responsibility swim lanes set early. New cross-company leadership for marketing, sales, and supply chain has been hired or appointed to implement consistent processes across all three brands. The organization is flat and not siloed, leveraging remote collaboration tools to manage teams across multiple states, keeping communication barriers low.

Q: What is your M&A target sweet spot for future acquisitions, and what types of opportunities are you prioritizing? / A: Management is focused primarily on the U.S. market, targeting both complementary branded products in the functional coffee and superfood space, and acquisitions that add new capabilities to benefit the entire portfolio. The current sweet spot is independent brands with $40 million to $80 million in annual revenue, though management would consider larger targets if they fit the strategy. Acquisitions that add both product and new capabilities (like the TerraSol acquisition) are particularly attractive, and management would pursue five more similar acquisitions if available.