Farmer Bros. Co. (FARM) Q4 2025 Earnings Call Transcript
Gross Margins Gross margins were above 43% for the year, a year-over-year improvement of 420 basis points. The fourth quarter gross margin was 44.9%, a year-over-year increase of 610 basis points. This improvement was attributed to a proactive pricing strategy that stayed ahead of rising green coffee market prices.
Adjusted EBITDA Adjusted EBITDA for the fourth quarter was $5.8 million and $14.8 million for the full fiscal year, representing a year-over-year improvement of more than $7 million for the quarter and more than $14 million for the full fiscal year. This improvement was driven by operational efficiencies and cost structure optimization.
Net Sales Net sales during the fourth quarter were $85.1 million compared to $84.4 million in the prior year period. For the full fiscal year, net sales were $342.3 million compared to $341.1 million in the prior year, showing a slight increase. The increase was modest due to challenges in the coffee market and consumer purchasing patterns.
Operating Expenses Operating expenses increased by $14.3 million to $150.4 million for the year, primarily due to a $20.2 million year-over-year decrease in net gains from asset sales. Excluding asset sales, operating expenses decreased by $6 million, reflecting progress in driving efficiencies in the SG&A cost structure.
Net Loss Net loss for the fourth quarter was $4.7 million compared to $4.6 million in the prior year. For the full fiscal year, the net loss was $14.5 million compared to $3.9 million in the prior year. The increase in net loss was due to noncash losses of $7.7 million related to pension settlements and a $20.2 million decrease in net gains on asset sales.
Free Cash Flow Free cash flow for the fourth quarter was $7.5 million and $6.5 million for the full fiscal year, representing a year-over-year increase of $12.1 million for the quarter and $34.5 million for the full fiscal year. This improvement was driven by better operating performance, improved working capital management, and CapEx efficiency.
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Farmer Bros. Co. Q2 2026 Earnings Call Insights
- Financial Performance Decline: Farmer Bros. reported net sales of $88.9 million for Q2, a 1% decrease year-over-year, while adjusted EBITDA was only $484,000, significantly down from $5.9 million in the prior year, indicating financial challenges under high costs and softening demand.
- Gross Margin Under Pressure: The gross margin for the quarter was 36.3%, reflecting a 680 basis point decline compared to the previous year, although management expects it to remain above 30% for the remainder of fiscal 2026, necessitating vigilance against green coffee market volatility.
- Operating Cost Control: Operating costs decreased by $1.4 million to $36.4 million this quarter, primarily due to reductions in selling and administrative expenses, showcasing the company's efforts in cost management aimed at enhancing overall profitability.
- Strategic Development Focus: Management emphasized the continued leverage of the DSD network and expansion of the white label portfolio to drive revenue growth, while actively assessing opportunities to maximize shareholder value, demonstrating the company's commitment to long-term growth amidst adversity.
Farmer Bros. Co. Reports Q2 Operating Loss of $4.136 Million
- Company Overview: Farmer Bros. Co. reported a Q2 income from operations of $4.136 million.
- Financial Performance: The reported income indicates the company's operational profitability during the second quarter.
Farmer Brothers Coffee Reports Q2 Earnings with Declining Sales and Increased Losses
- Sales Decline: Farmer Brothers Coffee reported Q2 net sales of $88.9 million, a decrease of $1 million or 1% year-over-year, indicating pressure in market competition that could affect future market share.
- Increased Net Loss: The company experienced a net loss of $4.9 million this quarter, compared to a net income of $200,000 in the prior year, highlighting significant financial challenges that may impact investor confidence.
- Declining Adjusted EBITDA: Adjusted EBITDA stood at $484,000, a sharp decline from $5.9 million in the same quarter last year, reflecting a substantial weakening in profitability that could complicate future financing efforts.
- Cash Flow Position: As of December 31, 2025, the company had $4.2 million in unrestricted cash and cash equivalents and $24.6 million available under its revolving credit facility, indicating some liquidity but raising concerns about the impact of ongoing losses on cash flow.
Major Earnings Preview: Farmer Bros. Co.
- Earnings Release Preview: Farmer Bros. Co. is set to report its earnings after the market closes on Friday, with market participants keenly anticipating the results, which are expected to impact the company's stock price.
- Market Reaction Expectations: Investors are optimistic about Farmer Bros. Co.'s earnings report, with analysts generally believing that the results will reflect the company's operational capabilities in the current economic environment.
- Industry Context: As a coffee and food distributor, Farmer Bros. Co.'s earnings will provide critical insights into its market share and competitiveness, particularly in the context of economic recovery.
- Future Outlook: The earnings results will inform the company's future strategic decisions, with investors closely monitoring changes in revenue and profit to assess the company's growth potential.
Farmer Brothers to Announce Q2 Earnings on February 13
- Earnings Announcement Date: Farmer Brothers is set to release its Q2 earnings report on February 13 after market close, with stakeholders keenly awaiting performance insights to gauge future growth potential.
- Earnings Expectations: The consensus EPS estimate stands at -$0.09, reflecting a staggering 1000% year-over-year decline, indicating significant profitability challenges that may dampen investor confidence.
- Revenue Forecast Changes: The consensus revenue estimate is $90.47 million, representing a modest 0.5% year-over-year increase, suggesting limited growth but still indicating some market demand that could support future recovery.
- Historical Performance Review: Over the past year, Farmer Brothers has only surpassed EPS and revenue estimates 25% of the time, highlighting instability in profitability and market performance, prompting investors to carefully assess the company's financial health.
Roth Capital Upholds Buy Rating for Farmer Bros. (FARM)
Analyst Recommendation: Roth Capital has maintained a Buy recommendation for Farmer Bros. (NasdaqGS:FARM) as of November 28, 2025, with an average one-year price target of $2.55/share, indicating a potential upside of 61.39% from its current price of $1.58/share.
Projected Revenue and EPS: Farmer Bros. is projected to achieve annual revenue of $582 million, reflecting a 71.88% increase, while the expected non-GAAP EPS is -0.45.
Fund Sentiment: There are currently 78 funds reporting positions in Farmer Bros., with a slight decrease in ownership by 2.50% over the last quarter. The average portfolio weight for these funds is 0.07%, which has increased by 1.49%.
Shareholder Activity: Notable shareholders include 22nw, JCP Investment Management, and Gamco Investors, with some firms increasing their holdings in Farmer Bros. over the last quarter, while others have decreased their allocations.
Farmer Bros. Co. Q2 2026 Earnings Call Insights
- Financial Performance Decline: Farmer Bros. reported net sales of $88.9 million for Q2, a 1% decrease year-over-year, while adjusted EBITDA was only $484,000, significantly down from $5.9 million in the prior year, indicating financial challenges under high costs and softening demand.
- Gross Margin Under Pressure: The gross margin for the quarter was 36.3%, reflecting a 680 basis point decline compared to the previous year, although management expects it to remain above 30% for the remainder of fiscal 2026, necessitating vigilance against green coffee market volatility.
- Operating Cost Control: Operating costs decreased by $1.4 million to $36.4 million this quarter, primarily due to reductions in selling and administrative expenses, showcasing the company's efforts in cost management aimed at enhancing overall profitability.
- Strategic Development Focus: Management emphasized the continued leverage of the DSD network and expansion of the white label portfolio to drive revenue growth, while actively assessing opportunities to maximize shareholder value, demonstrating the company's commitment to long-term growth amidst adversity.
Farmer Bros. Co. Reports Q2 Operating Loss of $4.136 Million
- Company Overview: Farmer Bros. Co. reported a Q2 income from operations of $4.136 million.
- Financial Performance: The reported income indicates the company's operational profitability during the second quarter.
Farmer Brothers Coffee Reports Q2 Earnings with Declining Sales and Increased Losses
- Sales Decline: Farmer Brothers Coffee reported Q2 net sales of $88.9 million, a decrease of $1 million or 1% year-over-year, indicating pressure in market competition that could affect future market share.
- Increased Net Loss: The company experienced a net loss of $4.9 million this quarter, compared to a net income of $200,000 in the prior year, highlighting significant financial challenges that may impact investor confidence.
- Declining Adjusted EBITDA: Adjusted EBITDA stood at $484,000, a sharp decline from $5.9 million in the same quarter last year, reflecting a substantial weakening in profitability that could complicate future financing efforts.
- Cash Flow Position: As of December 31, 2025, the company had $4.2 million in unrestricted cash and cash equivalents and $24.6 million available under its revolving credit facility, indicating some liquidity but raising concerns about the impact of ongoing losses on cash flow.
Major Earnings Preview: Farmer Bros. Co.
- Earnings Release Preview: Farmer Bros. Co. is set to report its earnings after the market closes on Friday, with market participants keenly anticipating the results, which are expected to impact the company's stock price.
- Market Reaction Expectations: Investors are optimistic about Farmer Bros. Co.'s earnings report, with analysts generally believing that the results will reflect the company's operational capabilities in the current economic environment.
- Industry Context: As a coffee and food distributor, Farmer Bros. Co.'s earnings will provide critical insights into its market share and competitiveness, particularly in the context of economic recovery.
- Future Outlook: The earnings results will inform the company's future strategic decisions, with investors closely monitoring changes in revenue and profit to assess the company's growth potential.
Farmer Brothers to Announce Q2 Earnings on February 13
- Earnings Announcement Date: Farmer Brothers is set to release its Q2 earnings report on February 13 after market close, with stakeholders keenly awaiting performance insights to gauge future growth potential.
- Earnings Expectations: The consensus EPS estimate stands at -$0.09, reflecting a staggering 1000% year-over-year decline, indicating significant profitability challenges that may dampen investor confidence.
- Revenue Forecast Changes: The consensus revenue estimate is $90.47 million, representing a modest 0.5% year-over-year increase, suggesting limited growth but still indicating some market demand that could support future recovery.
- Historical Performance Review: Over the past year, Farmer Brothers has only surpassed EPS and revenue estimates 25% of the time, highlighting instability in profitability and market performance, prompting investors to carefully assess the company's financial health.
Roth Capital Upholds Buy Rating for Farmer Bros. (FARM)
Analyst Recommendation: Roth Capital has maintained a Buy recommendation for Farmer Bros. (NasdaqGS:FARM) as of November 28, 2025, with an average one-year price target of $2.55/share, indicating a potential upside of 61.39% from its current price of $1.58/share.
Projected Revenue and EPS: Farmer Bros. is projected to achieve annual revenue of $582 million, reflecting a 71.88% increase, while the expected non-GAAP EPS is -0.45.
Fund Sentiment: There are currently 78 funds reporting positions in Farmer Bros., with a slight decrease in ownership by 2.50% over the last quarter. The average portfolio weight for these funds is 0.07%, which has increased by 1.49%.
Shareholder Activity: Notable shareholders include 22nw, JCP Investment Management, and Gamco Investors, with some firms increasing their holdings in Farmer Bros. over the last quarter, while others have decreased their allocations.
