Barfresh Food Group (NASDAQ:BRFH) reported record results for the fourth quarter and full year of fiscal 2025, as management detailed a year marked by a manufacturing acquisition, new financing, and continued momentum in the K-12 education channel.
Record revenue as Arps Dairy acquisition reshapes operations
Founder and CEO Riccardo Delle Coste said fiscal 2025 was “transformational,” highlighting record full-year revenue of $14.2 million and fourth-quarter revenue of $5.4 million. Delle Coste attributed the year’s performance and strategic shift to the October acquisition of Arps Dairy, which added manufacturing assets and changed Barfresh’s operating model.
Delle Coste noted that the timeline for remaining construction and equipment installation at the larger facility has been extended to the fourth quarter of 2026 due to the timing of financing. He later told an analyst that the company expects to move into the new facility “before the end of the year,” while emphasizing that the current, older facility is “not ideal” but is working to meet near-term needs until the larger plant is fully online.
Margins pressured by transition and mixed business profiles
CFO Lisa Roger said full-year revenue rose to $14.2 million from $10.7 million in fiscal 2024, with the Arps Dairy acquisition contributing $2.9 million. However, margins compressed significantly during the transition.
Roger reported fourth-quarter gross margin of 3%, down from 26% in the year-ago period. Adjusted gross margin in the quarter was 4%, compared with 30% a year earlier. For the full year, adjusted gross margin was 22%, down from 37% in fiscal 2024.
Roger said the gross margin decline reflected startup and implementation costs tied to transitioning production into the company’s new facility to pursue long-term operational efficiencies and scale benefits. She added that continuing Arps Dairy’s existing milk processing business also affected consolidated margins, as that segment operates under different margin profiles and can be subject to commodity pricing fluctuations. Still, she characterized the milk operations as providing stable milk supply, supporting production, and adding diversification.
Roger said the company expects “incremental margin recovery” throughout the year, with acceleration in the second half of 2026 once equipment enhancements are completed and the new facility is commissioned.
Losses narrow, while adjusted EBITDA remains negative in 2025
On profitability, Roger said net loss for the fourth quarter improved to $763,000, compared with a net loss of $852,000 in the prior-year quarter. Full-year net loss was $2.7 million, compared with $2.8 million in fiscal 2024.
Selling, marketing and distribution expenses were $783,000 in the fourth quarter, down from $872,000 in the year-ago quarter. For the year, those expenses were $3.2 million, compared with $3.1 million in fiscal 2024.
General and administrative (G&A) expenses rose to $922,000 in the fourth quarter from $607,000 in the year-ago quarter. Full-year G&A was $3.2 million, compared with $3.0 million the year before.
Adjusted EBITDA for the fourth quarter was a loss of approximately $1.1 million, compared with a loss of approximately $563,000 in the prior-year period. For the full year, adjusted EBITDA was a loss of approximately $2.1 million, compared with a loss of $1.3 million in fiscal 2024. Roger said the company expects to achieve positive adjusted EBITDA in fiscal 2026 as it realizes the benefits of an integrated manufacturing model and completes facility optimization.
K-12 momentum builds, with large Nevada district win and customer re-engagement
Delle Coste emphasized that supply constraints earlier in fiscal 2025 limited growth in Barfresh’s base business and reinforced the rationale for acquiring Arps Dairy. He said the company focused on maintaining results and recovering customers impacted by supply shortfalls, with “many reintroductions occurring in the fourth quarter.”
He highlighted a recently announced seven-year bid award with the largest school district in Nevada, which he described as the fifth largest school district in the United States and serving more than 300,000 students. Delle Coste said the win validates Barfresh’s ability to secure placements with major districts and that expanded manufacturing capacity positions the company to support the district’s needs “reliably and consistently.”
Delle Coste also said Barfresh remains at only about 5% market penetration in the education channel overall, leaving “substantial runway for growth.” He added that the company’s Pop & Go 100% juice freeze pops have gained traction with several large school districts, and he cited strong uptake across the company’s Twist & Go portfolio.
In response to Maxim Group analyst Thomas McGovern, Delle Coste said re-engagement discussions with districts have centered on staying in close communication as product availability improves. He said many customers removed Barfresh products due to supply issues but “love the product,” adding that the company is going through bidding cycles again and working with distribution partners to re-enter certain markets.
McGovern also asked about seasonality and the cadence implied by guidance. Delle Coste said the revenue outlook reflects both the Barfresh and Arps businesses, and he pointed to Arps products—particularly ice cream mix—as “counter seasonal” and supportive of revenue in periods when Barfresh typically sees a drop-off. He said growth assumptions are based on the combined base businesses and “some foresight with some of the new accounts and bids that we’re winning.”
Financing, grant support, and updated fiscal 2026 guidance
Roger said that as of December 31, 2025, the company had approximately $2.3 million of cash and accounts receivable and approximately $1.7 million of inventory.
Both executives discussed a financing completed after year-end. In March 2026, Barfresh secured subscriptions for a $7.5 million senior convertible note financing. Delle Coste said the proceeds enabled the company to pay off the existing mortgage on the larger Defiance facility, meaning the company now owns its manufacturing plant “free and clear.” Roger added that proceeds were also used for other obligations and to accelerate construction completion. She said the structure provides flexibility because payments can be made in either cash or registered stock, which can help preserve cash during the construction phase.
Management also cited a previously announced $2.4 million government grant approved to purchase and install specialized equipment necessary for full-scale production operations.
Looking ahead, Delle Coste said the company is adjusting its fiscal 2026 outlook due to an updated facility and equipment timeline. Barfresh now expects:
- Fiscal 2026 revenue guidance: $28 million to $32 million
- Fiscal 2026 adjusted EBITDA guidance: $3.2 million to $3.8 million
- First-quarter fiscal 2026 revenue: $5.0 million to $5.2 million
- First-quarter fiscal 2026 adjusted EBITDA: break-even
Delle Coste said the revenue outlook implies year-over-year growth of 97% to 125%, driven by the full-year inclusion of Arps Dairy and growth in legacy Barfresh products, though he described it as a “more conservative ramp up schedule” than earlier projections.
During the Q&A, Delle Coste also said Barfresh intends to return to “aggressive sales mode” as manufacturing constraints ease, with opportunities beyond education including food service, retail, and convenience channels—areas the company had not been able to fully pursue due to limited supply.
About Barfresh Food Group (NASDAQ:BRFH)
Barfresh Food Group, Inc develops, manufactures and distributes a line of fresh-frozen, portion-controlled beverage and breakfast products for the foodservice and retail channels. The company’s flagship offerings include smoothie base blends, pancake and waffle mixes, and related griddle products designed to deliver convenience, consistency and controlled portions. Barfresh products require only the addition of liquid and blending or mixing prior to service, catering to operators seeking quick-serve solutions without sacrificing quality.
Operating from a single, fully certified manufacturing facility in Miami, Florida, Barfresh adheres to strict quality and safety protocols throughout its production processes.
