Lifeway Foods® Announces Record-Breaking Results for the First Quarter Ended March 31, 2026
Rhea-AI Summary
Lifeway Foods (Nasdaq:LWAY) reported record Q1 2026 results. Net sales reached $63.0 million, up 36.7% year-over-year, marking the 26th consecutive quarter of growth. Gross margin rose to 27.5%, up 360 bps, and net income increased 32% to $4.7 million.
SG&A was $10.9 million, up 16.8%, reflecting higher marketing and brand investments. Lifeway highlighted growth in Kefir and Farmer Cheese, new products like Muscle Mates and Kefir Butter, and reiterated its $45–$50 million Adjusted EBITDA target for FY 2027.
AI-generated analysis. Not financial advice.
Positive
- Net sales $63.0 million, up 36.7% year-over-year
- Gross margin 27.5%, expanding 360 basis points year-over-year
- Net income $4.7 million, up 32% versus prior year
- SG&A leveraged by 300 basis points despite higher spend
- 26th consecutive quarter of year-over-year net sales growth
- Reiterated $45–$50 million Adjusted EBITDA target for FY 2027
Negative
- Selling, general and administrative expenses rose 16.8% year-over-year to $10.9 million
News Market Reaction – LWAY
On the day this news was published, LWAY declined 4.59%, reflecting a moderate negative market reaction. Argus tracked a trough of -26.0% from its starting point during tracking. Our momentum scanner triggered 5 alerts that day, indicating moderate trading interest and price volatility. This price movement removed approximately $20M from the company's valuation, bringing the market cap to $416.43M at that time. Trading volume was very high at 4.8x the daily average, suggesting heavy selling pressure.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Market Reality Check
Peers on Argus
LWAY gained 7.45% while key peers were mixed: WEST -2.78%, SENEA -1.52%, USNA +2.62%, MAMA +2.24%, OTLY +0.50%. The move appears stock-specific rather than sector-driven.
Previous Earnings Reports
| Date | Event | Sentiment | Move | Catalyst |
|---|---|---|---|---|
| Mar 17 | Full-year 2025 earnings | Positive | -7.2% | Record 2025 net sales $212.5M, 13.7% growth and 54% net income increase. |
| May 13 | Q1 2025 earnings | Positive | -8.2% | Q1 2025 net sales $46.1M, 3.3% growth and 44% EPS increase. |
| Mar 24 | Record 2024 earnings | Neutral | +2.2% | Record full-year 2024 earnings combined with board nomination dispute disclosure. |
| Mar 14 | Full-year 2024 earnings | Positive | -1.8% | Record 2024 net sales $186.8M with 17% growth and strong margins. |
| Nov 14 | Q3 2024 earnings | Positive | -4.3% | Q3 2024 net sales $46.1M, 12.7% growth and improved gross margin. |
Earnings releases have generally been positive fundamentally but often saw negative next-day moves, suggesting a pattern of sell-the-news reactions that contrasts with today’s positive move.
Recent history shows Lifeway repeatedly posting record or strong results. In 2024 and 2025, the company reported record full-year earnings and over 20 consecutive quarters of growth, with net sales of $186.8M in 2024 and $212.5M in 2025. Prior earnings headlines consistently highlighted margin expansion and net income growth, yet shares often fell the next day. Today’s Q1 2026 record quarter and strong growth build directly on that trend of operational momentum.
Historical Comparison
Past earnings headlines for LWAY saw an average move of about -3.83%. Today’s +7.45% reaction to another record quarter stands out versus that pattern.
Earnings releases show a progression from record full-year 2024 results to even higher record 2025 sales, followed by strong, accelerating growth into Q1 2026 with expanding margins and continued Adjusted EBITDA targets for FY2027.
Regulatory & Risk Context
An effective shelf registration filed on Oct 29, 2025 covers up to 3,454,756 resale shares for Danone North America PBC and affiliates. The company states it will not receive proceeds from these secondary sales but will bear certain registration expenses, enabling the selling stockholder to sell shares more flexibly.
Market Pulse Summary
This announcement highlights Lifeway’s record Q1 2026 performance, with net sales of $63.0M, 36.7% growth, and gross margin expanding to 27.5%. It extends a multi-year run of record results and reiterates a FY 2027 Adjusted EBITDA target of $45–$50M. Investors may track whether volume-led growth, margin gains, and product innovation progress at a pace consistent with prior full-year 2024 and 2025 milestones.
Key Terms
gross profit margin financial
basis points financial
selling, general and administrative expenses financial
Adjusted EBITDA financial
non-GAAP financial measure financial
stock-based compensation financial
GLP-1 medical
AI-generated analysis. Not financial advice.
Achieves
Record-breaking results signal robust Kefir & Farmer Cheese growth, supported by the widening consumer focus on protein-rich, probiotic foods
Significant gross profit margin expansion of 360 basis points and net income growth of
"We kicked off 2026 with a blowout quarter that demonstrates the extraordinary momentum we've built across our business," said Julie Smolyansky, President and Chief Executive Officer of Lifeway Foods. "We far exceeded our previous record with net sales of
Ms. Smolyansky continued, "We believe Lifeway is uniquely positioned at the intersection of numerous consumer tailwinds with our on-trend, functional product offerings. The consumer focus on health and wellness continues to increase, gut-health awareness is spreading and demand from GLP-1 users seeking nutrient-dense, probiotic foods is particularly strong. We address each of these trends with our flagship Lifeway Kefir and high-protein Lifeway Farmer Cheese, while continuing to build a pipeline of innovative products, including Muscle Mates™ with creatine and probiotic Kefir Butter™. Together, these offerings bring new excitement to the category and expand our reach across the cultured dairy landscape. We are very excited about our trajectory and confident in our ability to execute throughout 2026 as we further capitalize on the growing consumer demand in our space."
First Quarter 2026 Highlights
- Net Sales:
$63.0 million 36.7% year-over-year. - Gross Profit Margin:
27.5% , up 360 basis points from23.9% last year. - Selling, general and administrative expenses were
$10.9 million 16.8% from last year, reflecting continued investment in marketing and brand awareness. - Net Income:
$4.7 million $0.31 $0.30 $3.5 million $0.23
Expanding Lifeway Visibility
Lifeway recently announced strategic partnerships, experiential marketing initiatives, and product innovation designed to elevate the brand's visibility and engage health-conscious consumers nationwide.
- The Company partnered with Erewhon to launch the Tropical Lifeway Smoothie, made with Organic Lifeway Kefir, offering the ultimate summer refreshment reminiscent of a creamy frozen lemonade while delivering the added benefits of probiotics and protein.
- The Company hosted a retro-inspired Wellness House in Palm Springs during festival weekend, bringing together media, influencers, tastemakers and wellness enthusiasts for a celebration of Lifeway's legacy and continued role in shaping the modern wellness conversation.
- The Company celebrated forty years of Kefir leadership with new cultured dairy innovations at Expo West 2026, showcasing its Lifeway Muscle Mates™ and Lifeway Kefir Butter™.
Outlook
The Company reiterated its long-term target of
"Our momentum continues to build as we drive sustainable, profitable growth across the business," Smolyansky concluded. "We have laid a foundation for durable, long-term value creation, and believe the investments we are making today in manufacturing capacity, marketing and innovation position us exceptionally well to capitalize on the tremendous opportunities ahead."
- Adjusted EBITDA is a non-GAAP financial measure. Adjusted EBITDA is defined as Operating Income, as reported, plus Depreciation and Amortization, plus Stock-Based Compensation.
Conference Call and Webcast
A webcast with Lifeway's President and Chief Executive Officer discussing these results with additional comments and details is available through the "Investor Relations" section of the Company's website at https://lifewaykefir.com/webinars-reports/.
About Lifeway Foods, Inc.
Lifeway Foods, Inc., which has been recognized as one of America's Growth Leaders by TIME, as Dairy Foods' Processor of the Year 2025, one of Forbes' Best Small Companies and named to Inc.'s 2025 Best in Business list in the Best Challenger Brands category, is America's leading supplier of the probiotic, fermented beverage known as kefir. In addition to its line of drinkable kefir, the Company also produces a variety of cheeses and a ProBugs® line for kids. Lifeway's tart and tangy fermented dairy products are now sold across
Forward-Looking Statements
This press release contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995 regarding, among other things, unaudited estimated net sales. These statements use words, and variations of words, such as "anticipate," "plan," "project," "estimate," "potential," "forecast," "will," "continue," "future," "increase," "believe," "outlook," "expect," and "predict." You are cautioned not to rely on these forward-looking statements. These forward-looking statements are made as of the date of this press release, are based on current expectations of future events and thus are inherently subject to a number of risks and uncertainties, many of which involve factors or circumstances beyond Lifeway's control. If underlying assumptions prove inaccurate or known or unknown risks or uncertainties materialize, actual results could vary materially from Lifeway's expectations and projections. These risks, uncertainties, and other factors include: price competition; the decisions of customers or consumers; the actions of competitors; changes in the pricing of commodities; the effects of government regulation; possible delays in the introduction of new products; and customer acceptance of products and services. A further list and description of these risks, uncertainties, and other factors can be found in Lifeway's Annual Report on Form 10-K for the fiscal year ended December 31, 2025. Copies of these filings are available online at https://www.sec.gov, http://lifewaykefir.com/investor-relations/, or on request from Lifeway. Lifeway expressly disclaims any obligation to update any forward-looking statements (including, without limitation, to reflect changed assumptions, the occurrence of anticipated or unanticipated events or new information), except as required by law.
Non-GAAP Financial Measures
This press release refers to Adjusted EBITDA, which is a financial measure that has not been prepared in accordance with
We are unable to reconcile our target fiscal year 2027 Adjusted EBITDA to projected net income, the most directly comparable projected GAAP financial measure, because certain information necessary to calculate such measures on a GAAP basis is unavailable or dependent on the timing of future events outside of our control. Due to this uncertainty, the Company cannot reconcile target fiscal year 2027 Adjusted EBITDA to the nearest GAAP financial measure without unreasonable effort.
Derek Miller
Vice President of Communications, Lifeway Foods
Email: derekm@lifeway.net
Perceptual Advisors
Dan Tarman
Email: dtarman@perceptualadvisors.com
General inquiries:
Lifeway Foods, Inc.
Phone: 847-967-1010
Email: info@lifeway.net
LIFEWAY FOODS, INC. AND SUBSIDIARIES | ||||||||
March 31, 2026 | December 31, | |||||||
(Unaudited) | 2025 | |||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 5,604 | $ | 5,571 | ||||
Accounts receivable, net of allowance for credit losses and discounts & allowances of | 22,985 | 16,643 | ||||||
Inventories, net | 11,452 | 11,890 | ||||||
Prepaid expenses and other current assets | 2,588 | 2,627 | ||||||
Refundable income taxes | 41 | 325 | ||||||
Total current assets | 42,670 | 37,056 | ||||||
Property, plant and equipment, net | 57,844 | 48,282 | ||||||
Operating lease right-of-use asset | 553 | 465 | ||||||
Goodwill | 11,704 | 11,704 | ||||||
Intangible assets, net | 5,683 | 5,818 | ||||||
Other assets | 2,051 | 2,285 | ||||||
Total assets | $ | 120,505 | $ | 105,610 | ||||
Current liabilities | ||||||||
Accounts payable | $ | 13,845 | $ | 11,008 | ||||
Accrued expenses | 4,589 | 5,413 | ||||||
Accrued income taxes | 1,518 | 218 | ||||||
Total current liabilities | 19,952 | 16,639 | ||||||
Line of credit | 6,939 | – | ||||||
Operating lease liabilities | 426 | 360 | ||||||
Deferred income taxes, net | 2,792 | 2,792 | ||||||
Other long-term liabilities | 74 | – | ||||||
Total liabilities | 30,183 | 19,791 | ||||||
Commitments and contingencies (Note 9) | – | – | ||||||
Stockholders' equity | ||||||||
Preferred stock, no par value; 2,500 shares authorized; none issued | – | – | ||||||
Common stock, no par value; 40,000 shares authorized; 17,274 shares issued; 15,282 and | 6,509 | 6,509 | ||||||
Treasury stock, at cost | (12,889) | (13,214) | ||||||
Paid-in capital | 3,347 | 3,843 | ||||||
Retained earnings | 93,355 | 88,681 | ||||||
Total stockholders' equity | 90,322 | 85,819 | ||||||
Total liabilities and stockholders' equity | $ | 120,505 | $ | 105,610 | ||||
LIFEWAY FOODS, INC. AND SUBSIDIARIES | ||||||||
2026 | 2025 | |||||||
Net Sales | $ | 63,012 | $ | 46,091 | ||||
Cost of goods sold | 44,741 | 34,254 | ||||||
Depreciation expense | 920 | 802 | ||||||
Total cost of goods sold | 45,661 | 35,056 | ||||||
Gross profit | 17,351 | 11,035 | ||||||
Selling expense | 6,188 | 4,698 | ||||||
General and administrative expense | 4,703 | 4,628 | ||||||
Amortization expense | 135 | 135 | ||||||
Total operating expenses | 11,026 | 9,461 | ||||||
Income from operations | 6,325 | 1,574 | ||||||
Other income (expense): | ||||||||
Interest expense | (68) | (14) | ||||||
Gain on sales of investments | – | 3,352 | ||||||
Other income (expense), net | – | 54 | ||||||
Total other (expense) income | (68) | 3,392 | ||||||
Income before provision for income taxes | 6,257 | 4,966 | ||||||
Provision for income taxes | 1,583 | 1,426 | ||||||
Net income | $ | 4,674 | $ | 3,540 | ||||
Net earnings per common share: | ||||||||
Basic | $ | 0.31 | $ | 0.23 | ||||
Diluted | $ | 0.30 | $ | 0.23 | ||||
Weighted average common shares outstanding: | ||||||||
Basic | 15,257 | 15,134 | ||||||
Diluted | 15,559 | 15,333 | ||||||
LIFEWAY FOODS, INC. AND SUBSIDIARIES | ||||||||
Three months ended March 31, | ||||||||
2026 | 2025 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 4,674 | $ | 3,540 | ||||
Adjustments to reconcile net income to operating cash flow: | ||||||||
Depreciation and amortization | 1,055 | 937 | ||||||
Stock-based compensation | 548 | 326 | ||||||
Non-cash interest expense | 5 | 3 | ||||||
Bad debt expense | 87 | – | ||||||
Gain on sale of investments | – | (3,352) | ||||||
Fair value loss on investment | – | 20 | ||||||
(Increase) decrease in operating assets: | ||||||||
Accounts receivable | (6,429) | (1,259) | ||||||
Inventories | 438 | (563) | ||||||
Prepaid expenses and other current assets | 228 | 136 | ||||||
Refundable income taxes | 283 | 631 | ||||||
Increase (decrease) in operating liabilities: | ||||||||
Accounts payable | 3,397 | 1,401 | ||||||
Accrued expenses | (1,282) | (2,765) | ||||||
Accrued income taxes | 1,300 | 795 | ||||||
Other long-term liabilities | 74 | – | ||||||
Net cash provided by (used in) operating activities | 4,378 | (150) | ||||||
Cash flows from investing activities: | ||||||||
Purchases of property and equipment | (11,041) | (2,219) | ||||||
Proceeds from sale of investments | – | 5,152 | ||||||
Net cash (used in) provided by investing activities | (11,041) | 2,933 | ||||||
Cash flows from financing activities: | ||||||||
Borrowings under line of credit | 8,000 | – | ||||||
Repayments under line of credit | (1,000) | – | ||||||
Payment of deferred financing costs | (21) | (65) | ||||||
Equity award settled in cash | (283) | – | ||||||
Net cash provided by (used in) financing activities | 6,696 | (65) | ||||||
Net increase in cash and cash equivalents | 33 | 2,718 | ||||||
Cash and cash equivalents at the beginning of the period | 5,571 | 16,728 | ||||||
Cash and cash equivalents at the end of the period | $ | 5,604 | $ | 19,446 | ||||
Supplemental cash flow information: | ||||||||
Cash paid for income taxes, net of (refunds) | $ | – | $ | – | ||||
Cash paid for interest | $ | 45 | $ | 11 | ||||
Non-cash investing activities | ||||||||
Accrued purchase of property and equipment | $ | 216 | $ | 239 | ||||
Right-of-use assets obtained in exchange for lease obligations | $ | 119 | $ | 8 | ||||
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SOURCE Lifeway Foods, Inc.