Lifecore Biomedical (NASDAQ:LFCR) used its fiscal fourth-quarter earnings call to highlight revenue growth, improving margins, and continued cost reductions during its transition to a calendar-year reporting cycle. Management also discussed progress on commercial milestones tied to its largest customer, updates to its development and business development pipelines, and provided full-year 2026 financial guidance.
Transition-period results show revenue growth and margin improvement
For the quarter ended December 31, 2025, Lifecore reported revenue of $35.7 million, up 10% from $32.6 million in the most comparable prior-year quarter ended November 24, 2024. For the approximately seven-month transition period from May 26, 2025 through December 31, 2025, revenue was $75.5 million, up 20% from $63.0 million in the comparable prior-year period.
On profitability, gross profit in the quarter was $12.8 million, compared with $11.1 million in the prior comparable quarter. Over the seven-month transition period, gross margin improved to 31% from 26% a year earlier, which Lake said was primarily driven by higher HA volume and better manufacturing absorption.
Adjusted EBITDA improved as well. Lifecore posted $8.6 million of adjusted EBITDA for the quarter, up from $6.5 million in the comparable period. For the seven-month transition period, adjusted EBITDA rose to $13.1 million from $2.6 million a year earlier, reflecting higher gross profit and reduced recurring SG&A.
Operating expense reductions and liquidity progress
Management emphasized that cost reductions have been a key component of its transformation plan. SG&A expense for the quarter fell to $7.5 million from $11.1 million in the comparable quarter, driven by lower non-recurring expenses related to legacy matters and prior restructuring, and reduced stock-based compensation. For the seven-month transition period, SG&A was $19.5 million versus $30.8 million in the comparable prior-year period.
Lake said the company has now recorded six consecutive quarters of period-over-period declines in operating expenses. He also said operating expenses fell $11.1 million during the seven-month transition period versus the comparable prior-year period, and that the company has reduced operating expenses by over $7 million cumulatively over the past 18 months, including reductions in accounting, consulting, and legal expenses.
Net losses narrowed. Lifecore reported a quarterly net loss of $5.1 million, or $0.16 per diluted share, compared with a net loss of $6.6 million, or $0.25 per diluted share, in the comparable period. For the seven-month transition period, net loss was $18.0 million, or $0.54 per diluted share, versus $30.6 million, or $0.99 per diluted share, a year earlier. Lake noted the impact of non-cash debt derivative adjustments in both periods.
On liquidity, Lake said the company ended the year with approximately $39 million of liquidity, including about $17.5 million in cash and cash equivalents and about $21 million available under its revolver. He added that the quarter marked Lifecore’s fourth consecutive quarter of positive cash flow from operations, and that excluding a $4.7 million preferred stock registration rights payment in Q4, it would have been the third consecutive quarter of free-cash-flow positivity. For the seven-month transition period, Lifecore generated $7.3 million in operating cash flow and $3.6 million of free cash flow.
Commercial milestones and pipeline updates
President and CEO Paul Josephs said 2025 included milestones intended to support an anticipated increase in aseptic fill-finish demand from Lifecore’s largest customer that is expected to begin in 2027. He highlighted two qualifications achieved during the year:
- Qualification of a five-head isolator filler to supply European and Asian markets for the largest customer.
- Qualification of Lifecore’s hyaluronic acid for supply to the Japanese market.
Josephs said expansion into Europe and Asia is expected to help drive a more than doubling of the customer’s aseptic fill-finish demand, and he described these qualifications as important steps toward that anticipated “financial inflection point.”
He also discussed additions to Lifecore’s late-stage pipeline, including two commercial site transfers added in 2025. Josephs characterized commercial site transfers as having existing demand and being de-risked because they do not require additional clinical trials, but instead require qualification at Lifecore. He said Lifecore expects both products to generate commercial revenue in 24–30 months, citing timing discussions with customers and a regulatory environment requiring what he described as a pre-approval inspection and an additional approval process.
At the same time, Lifecore updated its expected launch timeline for late-stage programs. Josephs said prior expectations had launch dates between 2026 and 2029, but the company is adjusting that outlook to between 2027 and 2030, citing factors outside Lifecore’s control such as changes in customers’ development strategies and financing challenges experienced by two customers in 2025.
2026 outlook and factors affecting guidance
For full-year 2026, Lifecore guided to:
- Total revenue: $120 million to $125 million
- Net loss: $28.9 million to $33.4 million
- Adjusted EBITDA: $20.5 million to $25 million
Lake said the 2026 outlook reflects several customer-related variables, including: (1) the anticipated loss of a customer due to a change in that customer’s supply chain strategy; (2) a customer’s decision to build excess HA inventory in 2025 related to a transition of aseptic volume demand to Lifecore in 2027; and (3) a commercial launch targeted for 2026 that has been delayed due to customer funding challenges.
In Q&A, management said the delayed commercial launch involves a smaller company and a product already commercialized in other markets, which it said provides confidence it will move forward. Josephs said the launch has shifted from 2026 to 2028, and the company expects more visibility into the customer’s plans during the summer.
On revenue cadence for 2026, Lake said the company expects revenue to be roughly in the mid-40% range in the first half and the mid-50% range in the second half. He said gross margins are expected to be in the 30% range with variability based on mix, volume, and shipment timing.
Lake also said the company’s base case for 2026 contemplates generating free cash flow in excess of $10 million, while noting that results could be impacted by legacy-related expenses, the timing of capital expenditures, and potential preferred stock redemptions or debt prepayments. He described expected capital expenditures as being in the $8 million range.
About Lifecore Biomedical (NASDAQ:LFCR)
Lifecore Biomedical, Inc is a publicly traded specialty biopharmaceutical company headquartered in Chaska, Minnesota. The company focuses on the development, manufacture and commercialization of hyaluronic acid (HA)–based products that address medical and aesthetic needs. Lifecore’s proprietary HA formulations are designed to meet strict regulatory standards for purity, consistency and performance in highly regulated markets.
The company’s product portfolio spans multiple therapeutic areas, including ophthalmology, orthopedics, dermatology and wound care.
