Hydrofarm | 8-K: FY2025 Q3 Revenue Misses Estimate at USD 29.35 M

LB filings
2025.11.12 12:39
portai
I'm PortAI, I can summarize articles.

Revenue: As of FY2025 Q3, the actual value is USD 29.35 M, missing the estimate of USD 35.73 M.

EPS: As of FY2025 Q3, the actual value is USD -3.51.

EBIT: As of FY2025 Q3, the actual value is USD -9.625 M.

Financial Data and Outlook Summary

Segment Revenue

  • Net Sales: Decreased to $29.4 million compared to $44.0 million in the prior year period, a decline of 33.3%.

Operational Metrics

  • Gross Profit: Decreased to $3.4 million, or 11.6% of net sales, compared to $8.5 million, or 19.4% of net sales, in the prior year period.
  • Adjusted Gross Profit: Decreased to $5.5 million, or 18.8% of net sales, compared to $10.7 million, or 24.3% of net sales, in the prior year period.
  • SG&A Expense: Improved to $16.4 million, compared to $17.6 million in the prior year period.
  • Adjusted SG&A Expense: Improved to $9.9 million compared to $10.7 million in the prior year period.
  • Net Loss: Increased to $16.4 million, or -$3.51 per diluted share, compared to a net loss of $13.1 million, or -$2.86 per diluted share in the prior year period.
  • Adjusted EBITDA: Decreased to -$4.4 million, compared to less than $0.1 million in the prior year period.

Cash Flow

  • Cash Used in Operating Activities: Less than $0.1 million.
  • Free Cash Flow: -$0.2 million, an improvement of $5.1 million compared to the prior year third quarter.

Balance Sheet

  • Cash and Cash Equivalents: $10.7 million as of September 30, 2025.
  • Available Borrowing Capacity: Approximately $4 million on its Revolving Credit Facility.
  • Principal Balance Outstanding on Term Loan: $114.5 million.
  • Finance Leases: $8.0 million.
  • Other Debt Outstanding: $0.1 million.

Unique Metrics

  • Proprietary Brand Mix: Increased in Q3 2025 compared to the first half of 2025, offset by lower manufacturing production volume negatively impacting AGPM%.
  • Restructuring Plan: On track for $3 million of estimated annual cost reductions, with new actions expected to generate an additional $2 million in annual savings.
  • Further annual cost savings of approximately $4 million identified.

Outlook / Guidance

  • Adjusted Gross Profit Margin: Expected to be approximately 20% for 2025, driven by a higher proprietary brand sales mix, cost savings from restructuring, and minimal non-restructuring inventory reserves.
  • Adjusted SG&A Expense: Expected to be reduced year-over-year, benefiting from reductions completed in 2024 and additional savings in 2025.
  • Inventory Reduction and Positive Free Cash Flow: Expected for the final nine months of 2025.
  • Capital Expenditures: Expected to be less than $2 million for the full year 2025.
  • High tariffs on imported products from China or new tariffs from other countries could impact the cost of certain products and may negatively impact performance.
Source: LB filings The copyright of this article belongs to the original author/organization.
The views expressed herein are solely those of the author and do not reflect the stance of the platform. The content is intended for investment reference purposes only and shall not be considered as investment advice. Please contact us if you have any questions or suggestions regarding the content services provided by the platform.