FitLife Brands 2025 Q3 Earnings Net Income Drops 56.7% Amid Irwin Acquisition Costs

FitLife Brands (FTLF) reported Q3 2025 results marked by a 56.7% year-over-year decline in net income to $921,000, driven by acquisition-related expenses and margin compression. While revenue surged 47% to $23.48 million, EPS fell 56.5% to $0.10. The company maintained its long-term profitability streak but signaled near-term challenges from rising costs and consumer weakness.

Revenue

FitLife Brands’ total revenue rose 47% year-over-year to $23.48 million in Q3 2025, driven by the August acquisition of Irwin Naturals. Legacy FitLife contributed $12.86 million, with MusclePharm and Irwin adding $3.81 million and $6.82 million, respectively. Wholesale revenue surged 156% to $13.2 million, while online sales declined 5% to $10.3 million. The acquisition accounted for $6.8 million of the $7.5 million revenue increase, with organic growth from other segments totaling $700,000.

Earnings/Net Income

Net income plummeted to $921,000 in Q3 2025, a 56.7% drop from $2.13 million in 2024 Q3, as acquisition costs, lower gross margins, and higher tax expenses eroded profitability. EPS fell to $0.10 from $0.23. Despite sustained four-year profitability, the decline underscores near-term margin pressures and operational challenges.

Price Action

The stock price climbed 3.48% on the day of the earnings release but fell 1.60% over the subsequent week and 7.98% month-to-date.

Post-Earnings Price Action Review

The strategy of buying FTLF shares on the earnings date and holding for 30 days yielded modest returns, with an average gain of 5% compared to the S&P 500’s 15%. However, the stock exhibited higher volatility, with peak-to-trough declines of 10% during market corrections versus the S&P 500’s 5%. Consistently underperforming the benchmark, the approach may appeal to short-term traders but lacks appeal for long-term investors.

CEO Commentary

Chairman & CEO Dayton Judd highlighted the 47% revenue growth, driven by Irwin’s $6.8 million contribution and MusclePharm’s 55% organic increase. Challenges included margin compression (37.2% gross margin vs. 43.8% prior year) and consumer weakness. Strategic priorities include transitioning Irwin’s wholesale sales to higher-margin online channels, optimizing supply chains, and planning MusclePharm price hikes in early 2026 to offset rising whey protein costs.

Guidance

Judd outlined plans to address inflation in whey protein costs with January 2026 MusclePharm price increases. Irwin’s gross margins are expected to improve as online sales scale and supply chains optimize. The company anticipates debt reduction starting Q4 2025 and a normalized tax rate of 24-25% long-term. Consumer weakness, including Amazon subscriber declines, is expected to persist but not significantly impact annual results.

Additional News

1. M&A Activity: FitLife acquired Irwin Naturals on August 8, 2025, contributing $6.8 million in revenue during the 53-day period from August 9 to September 30. The acquisition is expected to diversify product offerings and generate future synergies.

2. Strategic Shifts: Irwin’s wholesale sales to Amazon’s primary seller were halted to focus on direct-to-consumer online channels. The first Amazon sales began October 11, 2025, with daily revenue of $10,000.

3. Cost Optimization: Management announced additional cost cuts at Irwin to improve margins, including supply chain and SG&A efficiencies, with impacts expected in Q4 2025 and beyond.

FitLife Brands’ Q3 results highlight the dual-edged impact of rapid growth through acquisitions and the need for margin recovery strategies. While revenue growth is robust, near-term profitability remains pressured by integration costs and rising input prices. Investors will closely monitor the success of Irwin’s online channel expansion and MusclePharm’s pricing adjustments in 2026.