Local Bounti Announces First Quarter 2025 Financial Results
- 38% year-over-year revenue growth to $11.6 million
- Improved adjusted gross margin to 29% from 24% year-over-year
- Secured $25 million equity investment and restructured debt with better terms
- Expanded distribution network with Walmart, HEB, and Brookshire's
- Reduced annualized expenses by approximately $7 million
- On track for positive adjusted EBITDA by Q3 2025
- Net loss increased to $37.7 million from $24.1 million year-over-year
- Higher interest expenses due to $5.6 million decrease in capitalized interest
- Adjusted EBITDA loss widened to $8.8 million from $6.9 million year-over-year
- General and administrative expenses increased by $2.3 million to $8.1 million
Insights
Local Bounti shows promising 38% YoY growth with strategic path to positive EBITDA in Q3 2025, despite continued losses and debt complexities.
Local Bounti's Q1 2025 results reveal an emerging indoor agriculture player making substantial commercial progress while still navigating financial challenges. Revenue increased 38% year-over-year to
However, beneath the top-line growth lies a complex financial picture. The company posted a net loss of
The company's debt situation warrants attention. In March 2025, Local Bounti underwent a significant financial restructuring, securing a
The operational strategy focuses on three key vectors: expanded distribution, yield improvements, and cost management. The company has reduced annualized G&A expenses by
Looking ahead, management expects Q2 2025 revenue of
Local Bounti demonstrates CEA sector adaptability with strategic facility reconfiguration and product innovation, despite challenging path to profitability.
Local Bounti's Q1 results highlight the operational challenges and opportunities within the controlled environment agriculture (CEA) sector. The company's Stack & Flow Technology® is showing potential through meaningful yield improvements at the Georgia facility, with expectations for similar improvements at the Washington and Texas facilities in the second half of 2025. These productivity gains are essential for the economics of indoor farming, where maximizing output per square foot directly impacts unit economics.
The strategic reconfiguration of the Texas facility demonstrates both flexibility and market responsiveness. By converting three acres originally designated for head lettuce to accommodate both head lettuce and cut products, Local Bounti is adapting to customer preferences rather than pursuing a rigid production strategy. This transformation, while temporarily limiting full utilization during the transition period, positions the company to better align production with market demand. The planned installation of automated harvesting equipment in early Q3 2025 should drive further operational efficiencies and margin improvement, replacing the temporary harvester being used in Q2.
Product diversification is emerging as a key competitive strategy. The company has expanded beyond its core lettuce offerings to include arugula and basil programs with regional retailers, and is evolving its grab-and-go salad kit portfolio to capture changing consumer preferences. The development of a new product line targeting value-oriented consumers reflects awareness of economic pressures affecting purchasing decisions. The upcoming exclusive launch of a larger family-sized Caesar salad kit with a major retailer signals the company's ability to secure differentiated placement.
Local Bounti's expansion plans, including potential Midwest facilities, appear to be taking a more customer-centric approach by aligning new capacity with specific retailer commitments rather than building speculatively. This reflects a maturation in the CEA sector, moving away from the "build it and they will come" mentality that has challenged many indoor farming ventures. The expanded relationship with Walmart to serve 13 distribution centers represents a significant vote of confidence from the nation's largest retailer.
The company's path to profitability remains challenging but increasingly defined. The convergence of improved yields, facility utilization, new product introductions, and expanded distribution channels provides multiple levers for growth. However, the CEA industry continues to face fundamental questions about long-term economic viability given high capital requirements and energy costs. Local Bounti's technology approach and focus on operational efficiency will be critical tests of whether indoor farming can achieve the scale and profitability needed for sustained success.
Reports
Kathleen Valiasek, President, CEO and CFO of Local Bounti, stated, "Our first quarter progress across commercial and operational initiatives is converging toward a significant revenue lift in the second half of 2025 and positions us to achieve positive adjusted EBITDA in the third quarter. The dedication from our entire organization—where everyone from operations to sales to finance is aligned around reaching positive adjusted EBITDA—has been truly remarkable. This collective focus has strengthened our foundation, driving meaningful yield improvements in our
Craig Hurlbert, Executive Chairman of Local Bounti, stated, "I'm incredibly proud of our team's dedication as we navigate this pivotal phase in Local Bounti's journey. The increasing demand we're seeing from customers for our CEA products continues to validate the market opportunity ahead of us. The foundation we've built over these past years has positioned Local Bounti at a crucial inflection point, and I'm confident that under Kathy's leadership, we'll continue to execute on our strategic vision and create meaningful value for all stakeholders."
First Quarter 2025 Financial Summary
- Sales increased
38% to$11.6 million $8.4 million Georgia and sales from the Company's new facilities inTexas andWashington , which began shipping and selling products in the second quarter of 2024. - Gross profit was
$1.5 million 29% , excluding depreciation and stock-based compensation, as compared to24% in the prior year period. The Company expects that, over time, its adjusted gross margin will increase as a percentage of sales as a result of the continued scaling of the business and efforts to optimize production costs. - General and administrative expenses increased by
$2.3 million $8.1 million $5.8 million $5.8 million $1.5 million $3 million $4.0 million - Net loss was
$37.7 million $24.1 million $5.6 million Washington andTexas facilities. - Adjusted EBITDA1 loss was
$8.8 million $6.9 million $9.3 million $0.6 million $18.8 million $5.9 million $3.5 million
1See reconciliation of the non-GAAP measures at the end of this press release.
Commercial Facilities Update
Texas Facility Product Mix Transition Progress
The Company continues to make significant progress at its six-acre
Capacity Expansion Project Update
Plans remain in place to build additional capacity across the Company's network of facilities enabled with its patented Stack & Flow Technology®. The expansions are designed to provide additional capacity and allow for the Company's growing product assortment to meet existing demand from Local Bounti's direct relationships with blue-chip retailers and distributors. The timing and scope of these projects, including plans to expand into the Midwest, remain under review pending ongoing discussions with retailers to optimize those facilities for specific products in support of retail commitments and strategies to expand distribution.
Product Development & Distribution
Local Bounti continues to expand its commercial footprint with several notable distribution wins in the first quarter of 2025. The Company expanded its
The Company's relationship with Walmart continues to strengthen, building on the 191 stores already being served with premium baby leaf varieties. Local Bounti has secured an additional commitment to serve 13 Walmart distribution centers with Conventional Living Butter Lettuce, with shipments having commenced in late April from both the
Local Bounti has also evolved its Grab-and-Go Salad Kit offerings to better serve retail partners and consumer trends. This includes the launch of new salad kits in Q1 2025, with additional flavors expected to be introduced in Q3, as well as the creation of a new product line that meets the needs of today's value-oriented consumer. The Company is particularly excited about its upcoming exclusive launch of a new larger, approximately 12-ounce family-sized Caesar salad kit with a large multi-national retailer in the Pacific Northwest beginning in the third quarter. In addition, Local Bounti continues to expand its relationship with a leading meal subscription business that is now seeking additional SKUs.
Capital Structure
The Company ended the quarter with cash and cash equivalents and restricted cash of
As previously disclosed, in March 2025, Local Bounti secured a
The
The Company continues to pursue opportunities to lower its cost of capital and replace its construction financing, including sale leaseback transactions and its work with a licensed United States Department of Agriculture (USDA) lender.
As of March 31, 2025, Local Bounti had approximately 10.6 million shares outstanding, 10.7 million preferred shares, 6.2 million common shares under warrants outstanding, and approximately 0.8 million restricted stock units outstanding. As of March 31, 2025, including these warrants and restricted stock units, the Company had a fully diluted share count of approximately 28.3 million shares outstanding. On a proforma basis, adjusted to include the 10.7 million of preferred shares currently outstanding associated with the March 2025 equity offering, the Company has 21.4 million shares outstanding as of March 31, 2025.
Financial Outlook
The Company expects second quarter 2025 sales of approximately
The Company believes that it will reach positive adjusted EBITDA in the third quarter of 2025, driven by sales growth and cost reduction initiatives.
Conference Call
The Company will host a conference call with members of the Local Bounti executive management team. The conference call is scheduled to begin at 8:00 a.m. ET on Wednesday, May 14, 2025. To participate on the live call, listeners in
In addition, the call will be broadcast live via webcast, hosted at the "Investors" section of the Company's website at localbounti.com and will be archived online.
About Local Bounti
Local Bounti is redefining indoor farming with an innovative method – its patented Stack & Flow Technology® – that significantly improves crop turns, increases output and improves unit economics. Local Bounti operates advanced indoor growing facilities across
Forward-Looking Statements
This press release includes "forward-looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. In some cases, you can identify these forward-looking statements by the use of terms such as "expect," "will," "continue," "believe," "anticipate," "estimate," "project," "intend," "should," "is to be," or similar expressions, and variations or negatives of these words, but the absence of these words does not mean that a statement is not forward-looking. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including, but not limited to statements regarding improving revenue, sales, costs, and margins; product expansions; facility operations and adjustments; financial guidance for 2025; timing for reaching positive adjusted EBITDA; lowering cost of capital; evaluation of lower cost of capital; and sufficiency of capital. These statements are subject to known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from results expressed or implied in this press release. The following factors, among others, could cause actual results to differ materially from those described in these forward-looking statements: Local Bounti's ability to continue as a going concern and the risk that Local Bounti will fail to obtain additional necessary capital when needed on acceptable terms or at all; Local Bounti's ability to generate significant revenue; restrictions and covenants contained in Local Bounti's debt facility agreements with Cargill Financial Services International, Inc. and Local Bounti's ability to comply therewith; the risk that, following the conversion of our Series A Preferred Stock, the concentrated ownership of our common stock will prevent other stockholders from influencing significant decisions; the risk that Local Bounti may never achieve or sustain profitability; the risk that Local Bounti could fail to effectively manage its future growth; Local Bounti's ability to complete the build out of its current or additional facilities in the future; Local Bounti's reliance on third parties for construction, the risk of delays relating to material delivery and supply chains, and fluctuating material prices; Local Bounti's ability to scale its operations and decrease its cost of goods sold over time; the potential for damage to or problems with Local Bounti's facilities; the impact that current or future acquisitions, investments or expansions of scope of existing relationships have on Local Bounti's business, financial condition, and results of operations; unknown liabilities that may be assumed in acquisitions; Local Bounti's ability to attract and retain qualified employees; Local Bounti's ability to develop and maintain its brand or brands; Local Bounti's ability to achieve its sustainability goals; Local Bounti's ability to maintain its company culture or focus on its vision as it grows; Local Bounti's ability to execute on its growth strategy; the risk of diseases and pests destroying crops; Local Bounti's ability to compete successfully in the highly competitive markets in which it operates; Local Bounti's ability to defend itself against intellectual property infringement claims or other litigation; Local Bounti's ability to effectively integrate the acquired operations of any CEA or similar operations which it acquires into its existing operations; changes in consumer preferences, perception, and spending habits in the food industry; the risk that seasonality may adversely impact Local Bounti's results of operations; Local Bounti's ability to repay, refinance, restructure, or extend its indebtedness as it comes due; Local Bounti's ability to comply with the continued listing requirements of the New York Stock Exchange ("NYSE") or timely cure any noncompliance thereof; and other risks and uncertainties indicated from time to time, including those under "Risk Factors" and "Forward-Looking Statements" in Local Bounti's Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on March 31, 2025, as supplemented by other reports and documents Local Bounti files from time to time with the SEC. Local Bounti cautions that the foregoing list of factors is not exclusive and cautions readers not to place undue reliance upon any forward-looking statements, which speak only as of the date hereof. Local Bounti does not undertake or accept any obligation or undertaking to update or revise any forward-looking statements to reflect any change in its expectations or any change in events, conditions, or circumstances on which any such statement is based.
Non-GAAP Financial Information
This press release contains references to adjusted EBITDA, adjusted gross profit, adjusted gross margin percentage and adjusted general and administrative expense, which are adjusted from results based on generally accepted accounting principles in
These non-GAAP financial measures are provided to enhance the user's understanding of the Company's prospects for the future and the historical performance for the context of the investor. The Company's management team uses these non-GAAP financial measures to assess performance and planning and forecasting future periods. These non-GAAP financial measures are not computed according to GAAP, and the methods the Company uses to compute them may differ from those used by other companies. Non-GAAP financial measures are supplemental; they should not be considered a substitute for, or superior to, financial information presented in accordance with GAAP and should be read only in conjunction with the Company's consolidated financial statements prepared in accordance with GAAP.
Refer to the attached financial supplement for a reconciliation of these non-GAAP financial measures to their most directly comparable GAAP measures for the three months ended March 31, 2025.
LOCAL BOUNTI CORPORATION | |||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | |||
(in thousands, except share and per share data) | |||
March 31, | December 31, | ||
2025 | 2024 | ||
Assets | |||
Current assets | |||
Cash and cash equivalents | $ 18,008 | $ 937 | |
Restricted cash | 10,405 | 6,529 | |
Accounts receivable, net | 2,591 | 2,282 | |
Inventory, net | 7,157 | 6,814 | |
Prepaid expenses and other current assets | 2,468 | 2,261 | |
Total current assets | 40,629 | 18,823 | |
Property and equipment, net | 369,208 | 370,978 | |
Operating lease right-of-use assets | 66 | 350 | |
Intangible assets, net | 36,891 | 37,783 | |
Other assets | 142 | 101 | |
Total assets | $ 447,197 | $ 428,035 | |
Liabilities, mezzanine equity, and stockholders' equity (deficit) | |||
Current liabilities | |||
Accounts payable | $ 15,340 | $ 16,987 | |
Accrued liabilities | 4,470 | 18,082 | |
Short-term debt | — | 20,205 | |
Financing obligation | 60 | 51 | |
Operating lease liabilities | 30 | 30 | |
Finance lease liabilities | 81 | 81 | |
Total current liabilities | 19,981 | 55,436 | |
Long-term debt | |||
Principal amount | 312,000 | 447,719 | |
Plus: Debt premium, net of amortization | 168,047 | — | |
Less: Unamortized deferred financing costs | — | (31,142) | |
Long-term debt, net | 480,047 | 416,577 | |
Financing obligation, noncurrent | 50,010 | 49,856 | |
Operating lease liabilities, noncurrent | 49 | 57 | |
Finance lease liabilities, noncurrent | 194 | 206 | |
Warrant liability | 9,913 | 6,403 | |
Total liabilities | 560,194 | 528,535 | |
Commitments and contingencies | |||
Mezzanine equity | |||
Series A Preferred Stock, | 21,457 | — | |
Stockholders' equity (deficit) | |||
Common stock, 10,642,968 and 8,656,122 issued and outstanding as of March 31, 2025 and December 31, 2024, respectively | 1 | 1 | |
Additional paid-in capital | 326,450 | 322,729 | |
Accumulated deficit | (460,905) | (423,230) | |
Total stockholders' equity (deficit) | (134,454) | (100,500) | |
Total liabilities, mezzanine equity, and stockholders' equity (deficit) | $ 447,197 | $ 428,035 | |
LOCAL BOUNTI CORPORATION | |||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||
(in thousands, except per share data) | |||
Three Months Ended March 31, | |||
2025 | 2024 | ||
Sales | $ 11,605 | $ 8,383 | |
Cost of goods sold(1)(2) | 10,144 | 7,597 | |
Gross profit | 1,461 | 786 | |
Operating expenses: | |||
Research and development(1)(2) | 6,977 | 3,487 | |
Sales and marketing(1)(2) | 2,114 | 1,782 | |
General and administrative(1)(2) | 8,104 | 5,816 | |
Total operating expenses | 17,195 | 11,085 | |
Loss from operations | (15,734) | (10,299) | |
Other income (expense): | |||
Change in fair value of warrant liability | (3,510) | (4,180) | |
Interest expense, net | (18,838) | (9,608) | |
Other income | 407 | 37 | |
Net loss | (37,675) | (24,050) | |
Less: Deemed dividend to preferred stockholders | 403 | — | |
Net loss attributable to common stockholders | $ (38,078) | $ (24,050) | |
Net loss applicable to common stockholders per basic common share: | |||
Basic and diluted | $ (4.32) | $ (2.89) | |
Weighted average common shares outstanding: | |||
Basic and diluted | 8,808,594 | 8,325,944 | |
(1) Amounts include stock-based compensation as follows: | |||
Three Months Ended March 31, | |||
2025 | 2024 | ||
Cost of goods sold | $ 11 | $ 21 | |
Research and development | 16 | 93 | |
Sales and marketing | 37 | (200) | |
General and administrative | 526 | (848) | |
Total stock-based compensation expense, net of amounts capitalized | $ 590 | $ (934) | |
(2) Amounts include depreciation and amortization as follows: | |||
Three Months Ended March 31, | |||
2025 | 2024 | ||
Cost of goods sold | $ 1,913 | $ 1,203 | |
Research and development | 2,686 | 797 | |
Sales and marketing | — | — | |
General and administrative | 1,281 | 1,228 | |
Total depreciation and amortization | $ 5,880 | $ 3,228 | |
LOCAL BOUNTI CORPORATION | |||
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION | |||
(in thousands) | |||
RECONCILIATION OF GROSS PROFIT TO ADJUSTED GROSS PROFIT AND ADJUSTED GROSS MARGIN PERCENTAGE | |||
Three Months Ended March 31, | |||
2025 | 2024 | ||
Sales | $ 11,605 | $ 8,383 | |
Cost of goods sold | 10,144 | 7,597 | |
Gross profit | 1,461 | 786 | |
Depreciation | 1,913 | 1,203 | |
Stock-based compensation | 11 | 21 | |
Adjusted gross profit | $ 3,385 | $ 2,010 | |
Adjusted gross margin % | 29 % | 24 % | |
RECONCILIATION OF GENERAL AND ADMINISTRATIVE EXPENSE TO ADJUSTED GENERAL AND ADMINISTRATIVE EXPENSE | |||
Three Months Ended March 31, | |||
2025 | 2024 | ||
General and administrative | $ 8,104 | $ 5,816 | |
Stock-based compensation | (526) | 848 | |
Depreciation and amortization | (1,281) | (1,228) | |
Business acquisition and strategic transaction due diligence and integration related costs | (96) | (842) | |
Intellectual property and other litigation | (311) | — | |
Restructuring and business realignment costs | (75) | (289) | |
Adjusted general and administrative | $ 5,815 | $ 4,305 | |
LOCAL BOUNTI CORPORATION | |||
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION | |||
(in thousands) | |||
RECONCILIATION OF NET LOSS TO ADJUSTED EBITDA | |||
Three Months Ended March 31, | |||
2025 | 2024 | ||
Net loss | $ (37,675) | $ (24,050) | |
Stock-based compensation expense | 590 | (934) | |
Interest expense, net | 18,838 | 9,608 | |
Depreciation and amortization | 5,880 | 3,228 | |
Business acquisition and strategic transaction due diligence and integration related costs | 96 | 842 | |
Debt restructuring costs | 649 | — | |
Intellectual property and other litigation | 311 | — | |
Restructuring and business realignment costs | 75 | 289 | |
Change in fair value of warrant liability | 3,510 | 4,180 | |
Other income | (1,056) | (37) | |
Adjusted EBITDA | $ (8,782) | $ (6,874) | |
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SOURCE Local Bounti
FAQ
What were Local Bounti's (LOCL) Q1 2025 revenue and growth?
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