Hydroponics equipment maker Hydrofarm misses Q3 sales estimates on lower production

Reuters
2025.11.12 12:41
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Hydrofarm reported a 33.3% year-over-year decline in Q3 net sales, falling short of analyst expectations. The company's gross profit margin decreased due to lower sales and production volumes. Bill Toler will resume the CEO role on December 1, 2025. Hydrofarm anticipates a 2025 Adjusted Gross Profit Margin of around 20% and positive free cash flow for the last nine months of 2025. The sales drop is attributed to industry oversupply, with a 32.2% decline in volume/mix. The median 12-month price target for Hydrofarm is $7.50, significantly above its recent closing price of $2.15.

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Overview

  • Hydrofarm Q3 net sales fell 33.3% yr/yr, missing analyst expectations
  • Company’s gross profit margin decreased due to lower sales and production volumes
  • CEO transition announced with Bill Toler resuming CEO role on Dec 1, 2025

Outlook

  • Hydrofarm expects 2025 Adjusted Gross Profit Margin of approximately 20%
  • Company reaffirms reduced Adjusted SG&A expense for 2025
  • Hydrofarm anticipates positive free cash flow for final nine months of 2025

Result Drivers

  • PROPRIETARY BRAND FOCUS - Co achieved best quarterly proprietary brand sales mix of 2025, aiding higher-margin product sales
  • INDUSTRY OVERSUPPLY - Sales decline attributed to 32.2% drop in volume/mix due to industry oversupply
  • COST SAVINGS INITIATIVES - Co expects $2 mln in annual savings from consolidating U.S. manufacturing facilities

Key Details

Metric Beat/Mis Actual Consensu

s s

Estimate

Q3 Sales Miss $29.35 $35.73

mln mln (1

Analyst)

Q3 Net -$16.39

Income mln

Q3 Gross $3.41

Profit mln

Q3 -$12.96

Operatin mln

g Income

Q3 -$16.27

Pretax mln

Profit

Analyst Coverage

  • Wall Street’s median 12-month price target for Hydrofarm Holdings Group Inc is $7.50, about 71.4% above its November 11 closing price of $2.15

Press Release: For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact . (This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)

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