Functional Brands Announces Fourth Quarter and Full-Year 2025 Financial Results

Rhea-AI Summary

Functional Brands (NASDAQ: MEHA) reported Q4 2025 revenue of $1.50M (down ~11% YoY) and Q4 net income of $0.9M ($0.01 diluted) versus a prior-year loss. Full-year 2025 revenue was $6.61M (+0.7% YoY) with net income of $0.8M ($0.01 diluted).

Gross margins compressed—Q4 margin 44.9% (down 1400 bps) and full-year margin 52.7% (down 220 bps)—driven by a shift in Amazon selling model and inventory adjustments from exiting the hemp business. Management launched Tru2u.health and expanded Kirkman distribution internationally.

Positive

• Net income turned positive: $0.8M FY2025
• Q4 net income of $0.9M ($0.01 per share)
• Launched Tru2u.health digital health platform
• Expanded Kirkman distribution with iHerb international partnership

Negative

• Q4 revenue declined ~11%
• Q4 gross margin down 1400 bps to 44.9%
• FY2025 gross margin down 220 bps to 52.7%

News Market Reaction – MEHA

-3.30%

4 alerts

-3.30% News Effect

-12.3% Trough Tracked

-$86K Valuation Impact

$2.52M Market Cap

0.0x Rel. Volume

On the day this news was published, MEHA declined 3.30%, reflecting a moderate negative market reaction. Argus tracked a trough of -12.3% from its starting point during tracking. Our momentum scanner triggered 4 alerts that day, indicating moderate trading interest and price volatility. This price movement removed approximately $86K from the company's valuation, bringing the market cap to $2.52M at that time.

Data tracked by StockTitan Argus on the day of publication.

Key Figures

Q4 2025 revenue: $1.50M Q4 2025 gross margin: 44.9% Q4 2025 net income: $0.9M +5 more

8 metrics

Q4 2025 revenue $1.50M Fourth quarter 2025 vs $1.68M prior-year period

Q4 2025 gross margin 44.9% Down 1400 basis points vs prior-year quarter

Q4 2025 net income $0.9M Versus net loss of $0.3M in prior-year quarter

Q4 2025 diluted EPS $0.01 Versus $(0.08) per diluted share prior-year quarter

FY 2025 revenue $6.61M Versus $6.57M in prior year (about 0.7% increase)

FY 2025 gross margin 52.7% Down 220 basis points vs prior year

FY 2025 net income $0.8M Versus net loss of $0.6M in prior year

Amazon revenue decline 11.0% Q4 2025 revenue decrease vs prior-year quarter

Market Reality Check

Price: $0.1495 Vol: Volume 1,104,571 is well ...

low vol

$0.1495 Last Close

Volume Volume 1,104,571 is well below the 20-day average of 10,447,295, indicating muted trading interest into this earnings release. low

Technical Shares at $0.1546 are trading below the 200-day MA of $0.30 and sit far under the $8.00 52-week high, near the $0.13 52-week low.

Peers on Argus

No peer stocks from the Medicinal Chemicals & Botanical Products / Packaged Food...

No peer stocks from the Medicinal Chemicals & Botanical Products / Packaged Foods group appeared in the momentum scanner, so the -7.15% move looks stock-specific rather than sector-driven.

Previous Earnings Reports

1 past event · Latest: Dec 15 (Positive)

Same Type Pattern 1 events

Date	Event	Sentiment	Move	Catalyst
Dec 15	Earnings results	Positive	-7.7%	Third quarter 2025 earnings with higher revenue, margins, and a swing to profit.

Pattern Detected

Prior earnings showed improved profitability but the stock sold off, and today’s negative move of -7.15% occurs alongside similarly mixed-but-profitable results.

Recent Company History

Across recent months, Functional Brands has focused on product launches and channel expansion, including the Tru2u.health platform and multiple Kirkman bundles, plus an international iHerb partnership. Earlier, third quarter 2025 earnings showed revenue of $1.7M, gross margin improving to 57.8%, and net income of $0.3M with $0.04 diluted EPS, yet the stock fell 7.68%. Today’s fourth quarter and full-year 2025 results continue the profitability narrative but again coincide with a negative price reaction.

Historical Comparison

-7.7% avg move · In the past, MEHA’s only tracked earnings release moved the stock -7.68%. Today’s earnings-linked mo...

earnings

-7.7%

Average Historical Move earnings

In the past, MEHA’s only tracked earnings release moved the stock -7.68%. Today’s earnings-linked move of -7.15% is consistent with that negative reaction pattern to financial results.

The company moved from reporting third quarter 2025 profitability to full-year 2025 results that maintain net income while revenues and margins show more mixed trends.

Market Pulse Summary

This announcement highlights a transition from net losses to profitability, with fourth quarter net ...

Analysis

This announcement highlights a transition from net losses to profitability, with fourth quarter net income of $0.9M and full-year $0.8M, even as revenue growth remains modest and margins compress. The shift in the Amazon business model and exit from hemp products weighed on sales and gross margin. Recent launches like Tru2u.health and new Kirkman bundles, plus the iHerb partnership, frame the growth story. Investors may watch future revenue trends and margin recovery closely.

Key Terms

gross margin, basis points, diluted share, digital health platform, +3 more

7 terms

gross margin financial

"Gross margin of 44.9% was down 1400 basis points versus the prior year period"

Gross margin is the difference between how much money a company makes from selling its products and how much it costs to produce them, expressed as a percentage of sales. It shows how efficiently a company is turning sales into profit before other expenses like marketing or salaries. Higher gross margin means the company keeps more money from each sale, which is a good sign of financial health.

basis points financial

"Gross margin of 44.9% was down 1400 basis points versus the prior year period"

Basis points are a way to measure small changes in interest rates or percentages, where one basis point equals 0.01%. For example, if a loan's interest rate increases by 50 basis points, it's gone up by 0.50%. They help people understand tiny differences in rates that can add up over time, making financial comparisons clearer.

diluted share financial

"Net income of $0.9 million or $0.01 per diluted share compared to a net loss"

Diluted share count is the total number of company shares that would exist if all potential claims that can become stock—such as employee stock options, warrants and convertible bonds—were exercised or converted. Investors use diluted shares to see a more conservative view of ownership and per-share metrics (like earnings per share), because it’s like slicing a cake into more pieces: the same profit spread over more slices makes each slice smaller.

digital health platform technical

"we launched Tru2u.health, our comprehensive digital health platform that integrates peptide"

A digital health platform is an online system that connects patients, healthcare providers, and health data through digital tools and software. It allows for the sharing, monitoring, and management of health information electronically, much like a digital version of traditional healthcare records and services. For investors, these platforms are important because they can improve healthcare efficiency, expand access to services, and generate new revenue streams in a growing industry.

peptide solutions medical

"digital health platform that integrates peptide solutions, GLP-1-based weight management"

Liquid preparations that contain peptides—short chains of amino acids used as medicines, research reagents, diagnostics, or cosmetic ingredients. Investors track peptide solutions because their commercial value depends on how well they can be made, kept stable, regulated and scaled for sale; think of them like delicate recipes that must be produced precisely to turn a scientific ingredient into a marketable product.

glp-1-based medical

"platform that integrates peptide solutions, GLP-1-based weight management programs, board-certified"

Drugs or therapies described as “GLP‑1‑based” are built around a naturally occurring hormone called GLP‑1; they mimic or enhance its action to lower blood sugar and often reduce appetite and weight. Investors watch GLP‑1‑based products because they can drive large sales, change how diseases like diabetes and obesity are treated, and affect regulatory, manufacturing and competitive dynamics — much like a breakthrough engine that can reshape an entire car market.

telehealth medical

"GLP-1-based weight management programs, board-certified telehealth support, and clean supplements"

Telehealth is the delivery of healthcare services and consultations remotely using video calls, phone, text messaging, or connected devices to monitor and transmit medical information. It matters to investors because it can reshape how patients access care, lower costs, and create new revenue streams or risks for healthcare providers, insurers and technology companies—similar to how online banking changed financial services—while also exposing businesses to reimbursement and regulatory shifts.

AI-generated analysis. Not financial advice.

Fourth quarter net income improved to $0.9 million compared to a net loss of $0.3 million in the prior year period

Lake Oswego, Oregon--(Newsfile Corp. - March 30, 2026) - Functional Brands Inc. (NASDAQ: MEHA), a leading innovator in wellness and performance products, today announced financial results for the fourth quarter and full-year ended December 31, 2025.

Fourth Quarter 2025 highlights

• Revenue of $1.50 million compared to $1.68 million in the prior year period, a decrease of approximately 11.0%. This decrease was primarily due to the shift in our Amazon business model from a reseller model to a direct-to-consumer approach through our own Amazon Seller's Central account.

• Gross profit was $0.67 million compared to $0.99 million in the prior year period. Gross margin of 44.9% was down 1400 basis points versus the prior year period due to changes in the Amazon business model and inventory adjustments related to our transition out of the hemp business.

• Net income of $0.9 million or $0.01 per diluted share compared to a net loss of $0.3 million and $(0.08) per diluted share in the prior year period.

Full Year 2025 highlights

• Revenue of $6.61 million compared to $6.57 million in the prior year, an increase of approximately 0.7%, reflecting the inherent stability of the Kirkman business.

• Gross profit was $3.48 million compared to $3.61 million in the prior year. Gross margin of 52.7% was down 220 basis points versus the prior year due to inventory adjustments related to our transition out of the hemp business.

• Net income of $0.8 million or $0.01 per diluted share compared to a net loss of $0.6 million and $(0.08) per diluted share in the prior year.

"We were pleased to deliver another year of strong bottom-line results as we continue to transform our business model," said Eric Gripentrog, CEO of Functional Brands Inc. "Over the past several months, we've executed a series of key initiatives that mark a pivotal period in the Company's evolution and establish a strong foundation for sustainable, profitable growth in the future. We achieved significant strategic breakthroughs that differentiate us in the marketplace and demonstrate our commitment to innovation across multiple fronts.

"In February, we launched Tru2u.health, our comprehensive digital health platform that integrates peptide solutions, GLP-1-based weight management programs, board-certified telehealth support, and clean supplements into a seamless consumer experience, providing us with a scalable, digitally native growth engine. We also expanded our Kirkman brand portfolio with two innovative product bundles - our Skin, Beauty & Anti-Aging Bundle in December and our Detox Aid Bundle in January. Additionally, we forged a strategic partnership with iHerb to make P2i by Kirkman available to international consumers across Asia, Europe, the Middle East, and Latin America, dramatically expanding our addressable market for the world's cleanest prenatal vitamin. These accomplishments demonstrate strong execution against our strategic goals and underscore our commitment to our mission of 'Making Everyone Healthy Again'."

About Functional Brands Inc.

Functional Brands Inc. is a health and wellness company focused on acquiring and growing science-based consumer brands. With a portfolio that includes trusted names like Kirkman®, P2i by Kirkman®, Tru2u.Health™; Functional Brands is committed to providing high-quality, effective solutions that support healthier lives.

For more information, visit www.functionalbrandsinc.com and www.kirkmangroup.com, and www.Tru2u.health

Investor Relations Contact:
FunctionalBrands@icrinc.com

Cautionary Note Regarding Forward Looking Statements

This news release and statements of Functional Brands' management in connection with this news release or related events contain or may contain "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. In this context, forward-looking statements mean statements (including statements related to the closing, and the anticipated benefits to the Company, of the private placement described herein) related to future events, which may impact our expected future business and financial performance, and often contain words such as "expects," "anticipates," "intends," "plans," "believes," "potential," "will," "should," "could," "would," "optimistic" or "may" and other words of similar meaning. These forward-looking statements are based on information available to us as of the date of this news release and represent management's current views and assumptions. Forward-looking statements are not guarantees of future performance, events or results and involve significant known and unknown risks, uncertainties and other factors which may be beyond our control.

Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of this news release. Potential investors should review Functional Brands' Registration Statement filed with the SEC on Form S-1 on October 16, 2025 and the Company's Annual Report on Form 10-K filed with the SEC on March 27, 2026 for more complete information, including the risk factors that may affect future results, which are available for review at www.sec.gov. Accordingly, forward-looking statements should not be relied upon as a predictor of actual results. We do not undertake to update our forward-looking statements to reflect events or circumstances that may arise after the date of this news release, except as required by law.

FUNCTIONAL BRANDS INC.
CONSOLIDATED BALANCE SHEETS (AUDITED)
(In U.S. dollars, except share data or otherwise noted)

		December 31, 2025			December 31, 2024
Assets
Current assets:
Cash		$	2,726,696		$	211,642
Accounts receivable, net			518,474			303,471
Inventories, net			1,549,511			1,709,458
Prepaid expenses and other current assets			392,999			45,112
Deferred offering costs			-			588,641
Total current assets			5,187,680			2,858,324
Noncurrent assets:
Property and equipment, net			37,379			49,564
Right-of-use assets, net			1,667,693			2,000,092
Intangible assets, net			1,397,411			1,443,541
Goodwill			818,139			818,139
Total non-current assets			3,920,622			4,311,336
Total assets		$	9,108,302		$	7,169,660
Liabilities and stockholders' equity / (deficit)
Current liabilities:
Accounts payable and accrued liabilities		$	1,554,243		$	1,956,165
Line of credit			8,109			32,235
SBA loan, current			3,595			3,436
Lease liabilities, current			371,272			291,213
Other current liabilities			41,828			35,332
Derivative liabilities			3,306,745			-
Payable for acquisition, current			-			2,342,366
Loans payable (related party), current			61,642			370,703
Loans payable			402,650			171,500
Total current liabilities			5,750,084			5,202,950
Non-current liabilities:
Lease liabilities, net of current			1,435,505			1,844,819
SBA loan, net of current			136,873			140,468
Loan payable (related party), net of current			244,509			-
Convertible debenture			-			100,000
Total non-current liabilities			1,816,887			2,085,287
Total liabilities			7,566,971			7,288,237
Stockholders' equity / (deficit)
Series A Preferred stock, par value $0.001 stated value $100, 100,000 and 0 shares authorized as of December 31, 2025 and 2024; 87,445 and 0 shares issued and outstanding, respectively			87			-
Series B Preferred stock, par value $0.001 stated value $100, 80,000 and 0 shares authorized as of December 2025 and 2024; 28,475 shares issued and 0 outstanding, respectively			28			-
Common stock, par value $0.00001, 220,000,000 shares authorized; 18,704,649 and 6,694,880 shares issued and outstanding at December 31, 2025 and 2024			187			67
Additional paid-in capital			8,522,354			7,542,286
Accumulated deficit			(6,981,325	)		(7,660,930	)
Total stockholders' equity / (deficit)			1,541,331			(118,577	)
Total liabilities and stockholders' equity / (deficit)		$	9,108,302		$	7,169,660

 

FUNCTIONAL BRANDS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In U.S. dollars, except share data or otherwise noted)

		(UNAUDITED) Three Months Ended December 31,						(AUDITED) Year Ended December 31,
		2025			2024			2025			2024
Revenue, net of returns		$	1,494,521		$	1,680,096		$	6,611,484		$	6,566,455
Cost of goods sold			823,766			690,623			3,127,518			2,959,609
Gross profit			670,755			989,473			3,483,966			3,606,846
Operating expenses
Sales and marketing			169,869			121,601			632,414			576,315
General and administrative expenses			1,633,636			1,003,619			4,250,124			3,259,623
Total operating expenses			1,803,505			1,125,220			4,882,538			3,835,938
Operating income / (loss)			(1,132,750	)		(135,747	)		(1,398,572	)		(229.092	)
Interest expense			(80,982	)		(142,284	)		(402,398	)		(331.836	)
Other income - ERTC refund			-			-			419,947			-
Other income			-			-			112			-
Interest income			1,352			281			74,696			1,572
Change in fair value of derivative liabilities			7,358,935			-			7,358,935			-
Loss on issuance of preferred stock derivative liability			(5,294,242	)		-			(5,294,242	)		-
Total other income / (expenses)			1,985,063			(142,003	)		2,157,050			(330.264	)
Net income / (loss)		$	852,313		$	(277,750	)	$	758,478		$	(559,356	)
Net income (loss) per share of common stock attributable to common stockholders
Basic		$	0.08		$	(0.08	)	$	0.08		$	(0.08	)
Diluted		$	0.01		$	(0.08	)	$	0.01		$	(0.08	)
Weighted average shares used in computing net loss per share of common stock
Basic			8,241,266			6,694,880			8,241,266			6,694,880
Diluted			85,120,861			6,694,880			85,120,861			6,694,880

 

FUNCTIONAL BRANDS INC.

CONSOLIDATED STATEMENTS OF CASH FLOW (AUDITED)

(In U.S. dollars, except share data or otherwise noted)

		Year Ended December 31,
		2025			2024
Cash flows from operating activities:
Net income (loss)		$	758,478		$	(559,356	)
Reconcile net income (loss) to cash (used in) provided by operating activities
Allowance for doubtful accounts receivable			(3,796	)		(32,491	)
Allowance for inventory obsolescence			53,855			(14,206	)
Depreciation of property and equipment			20,698			48,371
Amortization of right-of-use assets			332,399			306,935
Amortization of intangible assets			46,130			46,130
Financing expense on warrant issuance			45,413			-
Stock-based compensation			543,068			414,900
Change in fair value of derivative liabilities			(7,358,935	)		-
Loss on issuance of preferred stock of derivative liabilities			5,294,242			-
Issuance of shares for note extension			80,500			-
Issuance of common stock for convertible debenture			122,331			-
Issuance of shares for financing expense			50,629			-
Changes in operating assets and liabilities:
Accounts receivable			(211,207	)		(100,042	)
Inventories			106,092			(1,233	)
Prepaid expenses and other current assets			(347,887	)		27,329
Accounts payable and accrued liabilities			(480,795	)		132,161
Other current liabilities			6,496			(5,493	)
Lease liabilities			(329,255	)		(261,015	)
Net cash (used in) provided by operating activities			(1,271,544	)		1,990
Cash flows from investing activities:
Purchase of property and equipment			(8,513	)		(1,881	)
Net cash used in investing activities:			(8,513	)		(1,881	)
Cash flows from financing activities:
Deferred offering costs			(1,721,228	)		(163,125	)
Proceeds from loans			489,324			301,500
Payments for payable for acquisition			(2,342,366	)		(255,002	)
Proceeds from debt facilities			99,733			180,662
Repayment of loans			(422,727	)		(6,931	)
Proceeds from issuance of preferred stock			8,000,000			-
Buyback of preferred stock			(180,330	)		-
Line of credit repayment			(123,859	)		(216,742	)
SBA loan repayment			(3,436	)		(3,264	)
Net cash provided by (used in) financing activities			3,795,111			(162,902	)
Increase (decrease) in cash			2,515,054			(162,793	)
Cash beginning of period			211,642			374,435
Cash, end of period		$	2,726,696		$	211,642
Supplemental disclosures of cash flow information
Cash paid for interest		$	401,411		$	224,428
Non-cash investing and financing activities
Recognition of derivative liability of preferred stock		$	13,294,242		$	-
Conversion of preferred stock resulting in a non-cash reduction of the derivative liability recorded to APIC			2,628,242			-
Fair value adjustment decreasing derivative liability			7,358,935
Change in Preferred Stock			115			-
Conversion of preferred stock			112			-
Deferred offering costs			(2,309,869	)		-
Declaration of preferred stock dividend recorded as an increase in accrued liabilities			78,873			-
Common stock issued for convertible note payable and accrued interest			122,331			-
Loan payable, related party		$	225,000		$	-

 

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/290371

FAQ

What were Functional Brands (MEHA) Q4 2025 results and EPS?

Q4 2025 revenue was $1.50M with net income of $0.9M ($0.01 diluted). According to the company, this compares with a prior-year Q4 net loss of $0.3M and reflects model changes on Amazon and inventory transitions.

Why did MEHA gross margins decline sharply in Q4 2025?

Gross margin fell to 44.9%, down 1400 basis points versus prior year. According to the company, the decline was due to shifting the Amazon business model and inventory adjustments from transitioning out of the hemp business.

How did Functional Brands perform for full-year 2025 (MEHA)?

Full-year 2025 revenue was $6.61M (+0.7%) with net income of $0.8M ($0.01 diluted). According to the company, results reflect stability in the Kirkman business and margin pressure from inventory adjustments.

What is Tru2u.health and how does it affect MEHA growth?

Tru2u.health is a digital health platform integrating peptides, GLP-1 programs, telehealth, and supplements to drive D2C scale. According to the company, it provides a scalable, digitally native growth engine for future revenue expansion.

Did MEHA report any strategic distribution expansion in 2026?

Yes—MEHA expanded Kirkman distribution via a partnership with iHerb to reach Asia, Europe, Middle East, and Latin America. According to the company, this materially broadens international availability for its prenatal product P2i by Kirkman.