The Simply Good Foods Company (SMPL) Q3 2025 earnings summary

Executive summary

• Net sales grew 13.8% year-over-year to $381.0 million, driven by the OWYN acquisition and 3.8% organic growth, with Quest and OWYN delivering double-digit consumption gains and offsetting declines in Atkins.

• Adjusted EBITDA increased 2.8% to $73.9 million; net income for Q3 was $41.1 million, nearly flat year-over-year.

• The OWYN acquisition was completed in June 2024 for $281.9 million, funded by $250 million in new term debt and cash, and is nearly fully integrated.

• Fiscal year-to-date net sales reached $1,081.9 million, up 13.2%, with net income at $116.0 million and Adjusted EBITDA at $211.9 million.

• Nutritional snacking category continues robust double-digit growth, driven by demand for high-protein, low-sugar, and low-carb products.

Financial highlights

• Q3 gross profit rose 3.7% to $138.5 million; gross margin declined 350 bps to 36.4% due to higher input costs and OWYN's inclusion.

• Adjusted Diluted EPS for Q3 was $0.51, up from $0.50; reported Diluted EPS was $0.40, down from $0.41.

• Fiscal year-to-date gross profit was $399.1 million, up 9.2%, with gross margin at 36.9%, down 140 bps.

• Cash flow from operations for the nine months was $133.1 million, down from $166.8 million, mainly due to higher working capital and inventory build related to OWYN.

• Net debt to trailing twelve-month Adjusted EBITDA at 0.5x as of May 31, 2025.

Outlook and guidance

• Full-year net sales expected to increase 8.5%–9.5%, with organic growth primarily volume-driven and OWYN net sales projected at $145 million.

• Adjusted EBITDA expected to grow 4%–5%, with gross margins declining about 200 bps for the year.

• Q4 organic net sales expected to grow ~3%; Q4 Adjusted EBITDA to decline low double digits at midpoint, or mid-single digits excluding the extra week.

• Fifty-third week in FY24 is a 2-percentage point headwind to both net sales and Adjusted EBITDA growth in FY25.

• Guidance assumes stable economic conditions and consumer behavior, but inflation and tariffs remain key risks.