Simply Good Foods 2025 Q4 Earnings Severe Earnings Decline with 142% Net Loss

Simply Good Foods (NASDAQ:SMPL) reported mixed results for fiscal 2025 Q4, with revenue declining 1.8% year-over-year to $369.04 million and a net loss of $12.36 million, marking a stark contrast to the $29.29 million profit in 2024 Q4. The company’s guidance for 2026 signaled cautious optimism, with flat sales growth projected and margin pressures expected to persist.

Revenue

While total revenue dipped slightly, performance across segments revealed divergent trends. Quest, the company’s flagship brand, drove growth with $233.2 million in revenue, reflecting an 11% increase. OWYN, acquired in 2024, contributed $37.4 million, up 14% year-over-year. However, the legacy Atkins brand underperformed, with sales declining 12% to $91.7 million, dragging down overall results. This imbalance underscores the challenge of balancing growth in newer brands against declining older ones.

Earnings/Net Income

The company swung to a loss of $0.12 per share in 2025 Q4 from a profit of $0.29 per share in 2024 Q4, a 142.4% negative change. The net loss of $12.36 million represented a 142.2% deterioration compared to the previous year’s net income of $29.29 million. Despite a history of eight consecutive years of quarterly profitability, the recent results highlight operational and market headwinds. The EPS performance is notably weak, reflecting significant margin compression and cost pressures.

Post-Earnings Price Action Review

The stock price of Simply Good Foods has experienced volatile short-term movements, rising 0.72% on the latest trading day but plummeting 21.11% for the week and 19.93% month-to-date. Historically, the strategy of buying SMPL on revenue beats and holding for 30 days has shown mixed outcomes. While revenue beats occurred in 2025 Q4, 2023 Q4, and 2022 Q4, the subsequent 30-day returns were largely negative, with declines of 19.43%, 25.11%, and 7.4%, respectively. Data inconsistencies in historical revenue figures raise questions about the reliability of such a strategy. The latest earnings also saw a revenue beat but a sharp drop in EPS, compounding investor skepticism.

CEO Commentary

The CEO acknowledged supply chain disruptions and inflationary pressures as key challenges in 2025 Q4 but emphasized growth through digital transformation and cost optimization. Noting that Atkins is being leveraged as a cash cow to fund Quest and OWYN, the leadership remains cautiously optimistic about long-term prospects. Strategic priorities include expanding distribution partnerships and increasing marketing spend for the higher-growth brands.

Guidance

The company provided qualitative guidance for 2026, projecting flat sales growth with a range of -2% to +2% and margin declines of 100-150 basis points. While no explicit quantitative targets were set, the focus remains on operational discipline and cost-saving initiatives to mitigate inflationary impacts.

Additional News

Simply Good Foods’ recent $280 million acquisition of OWYN in 2024 has positioned the company to grow through strategic acquisitions. The OWYN brand, now contributing 14% revenue growth, is a key focus for 2026, with increased marketing budgets planned. Meanwhile, the underperforming Atkins brand, which saw a 12% volume decline, is being strategically deprioritized. The company’s long-term vision hinges on leveraging Quest and OWYN to offset legacy brand drag, though execution risks remain.

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