Arcadia Biosciences, Inc. Q1 FY2024 earnings call

• Positive business trends from Q4 2023 continued in Q1 2024 with revenue growth, gross profit margins >30% for 5 consecutive quarters, and operating expenses declining. - GoodWheat brand expanded distribution, launched GoodWheat Mac & Cheese nationwide on Amazon, and received accolades. - Zola Coconut Water category performed well, with flavor innovation starting in Q2 and new accounts adding to its store count. - Strategic review ongoing to explore strategic options like asset sale, acquisition, etc. - Anticipated 2024 net operating loss under $10 million, with plans to grow revenue, optimize margins, and reduce operating expenses in the remainder of 2024.

Revenue for Q1 2024 was approximately $1.3 million, increasing 7% sequentially and 2% year-over-year. GoodWheat contributed to year-over-year growth, while Zola Coconut Water saw unit sales and dollar sales both increase 10% year-over-year. In the latest 4 weeks ending March 30, 2024, Zola grew 15% in dollar sales and 14% in unit sales. GoodWheat brand expanded distribution, and Zola has new flavor innovation coming in Q2 with new accounts adding to its store count. GoodWheat made up 84% of the $5 million inventory at the end of Q1 2024. Revenue contribution: GoodWheat and Zola were key drivers, with Zola seeing a 28% sequential increase as Q4 is seasonally soft for coconut water.

• Anticipated 2024 net operating loss to be under $10 million, the first time in the company's history. - Plan to grow revenue, optimize margins, and reduce operating expenses for the remainder of 2024. - Use of cash expected to be in the single digits, more heavily weighted in the first half due to larger cash payments for employee bonuses and insurance.

• Uncertainty around the strategic review; no assurance that the exploration of strategic alternatives will result in the company entering or completing any transaction. - No timetable has been set for the conclusion of the strategic review.

Q: Questions regarding expenses associated with GoodWheat expansion, trajectory of these costs, focus on existing retail relationships, and Zola's progression A: T.J. stated upfront costs for GoodWheat are around promotions and slotting, with marketing investment to decrease as focus shifts to existing customers. Stan mentioned results with existing retailers are mixed, with some high spots and challenges. Stan indicated Zola is expected to be a major revenue and gross profit driver, with flavor innovation in Q2 and new accounts contributing to growth