Lifeway Foods® Announces Strong Fourth Quarter and Record-Breaking Full Year 2025
Results Led by the Company’s Flagship Kefir
Company achieves full year 2025 net sales of $212.5 million; up 19% year-over-year on a comparable basis
Record-breaking year marks six years of uninterrupted, volume-led annual net sales growth
Annual gross margin expansion of 140 basis points and net income growth of 54% reflect the Company’s disciplined operational execution
Morton Grove, IL — March 17, 2026 — Lifeway Foods, Inc. (Nasdaq: LWAY) (“Lifeway” or “the Company”), the leading U.S. supplier of kefir and fermented probiotic foods, today announced financial results for the fourth quarter and full year ended December 31, 2025.
“2025 was a truly remarkable year for Lifeway, marked by exceptional growth and operational excellence," said Julie Smolyansky, President and Chief Executive Officer of Lifeway Foods. "We achieved record-breaking full year net sales of $212.5 million, up 13.7% year-over-year, with a 19% increase on a comparable basis, representing our sixth consecutive year of strong volume-led growth. This outstanding performance was capped off by a very strong fourth quarter, with net sales of $55.4 million, up 18.0% year-over-year, and gross margin expansion of 250 basis points. Our disciplined execution drove significant gross margin expansion of 140 basis points for the full year and net income growth of 54%, demonstrating the strength and scalability of our business model.
Ms. Smolyansky continued, “Our marketing investments are paying off exceptionally well, as consumers continue to embrace our flagship Lifeway Kefir and high-protein Lifeway Farmer Cheese, while also responding enthusiastically to our on-trend innovation announcements for Muscle Mates™ and Lifeway Kefir Butter™. We are particularly excited about the recent validation from the U.S. government, which specifically named kefir in the new dietary guidelines and emphasized the importance of fermented foods and gut health. Lifeway's products are completely aligned with these guidelines, positioning us perfectly to capitalize on the growing consumer focus on protein-rich, probiotic and bioavailable foods. As awareness of GLP-1 medications and their impact on nutrition continues to surge, Lifeway stands uniquely positioned to serve both active GLP-1 users seeking nutrient-dense, gut-friendly foods and consumers looking for products that naturally stimulate GLP-1 hormone production. We are thrilled about the year ahead in 2026 and confident in our ability to deliver another phenomenal performance as we continue to meet the evolving needs of health-conscious consumers.”
Fourth Quarter 2025 Highlights
| · | Net Sales: $55.4 million, up 18.0% year-over-year. | |
| · | Gross Profit Margin: 27.8%, up 250 basis points from 25.3% last year. | |
| · | Selling, general and administrative expenses were $11.5 million, up slightly from last year, reflecting continued investment in marketing and brand awareness. | |
| · | Net Income: $2.5 million, or $0.17 per basic and $0.16 per diluted common share, compared to a net loss of $0.2 million, or net loss of $0.01 per basic and diluted common share in the prior year. |
Full Year 2025 Highlights
| · | Net Sales: $212.5 million, highest in Company history, up 13.7% year-over-year and approximately 19% on a comparable basis, adjusted for a customer relationship the Company strategically exited in the third quarter of 2024, and a distributor shifting from Lifeway delivered to customer pick-up in late 2024, resulting in lower net sales and lower freight expense. | |
| · | Gross Profit Margin: 27.4%, up 140 basis points from 26.0% last year. | |
| · | Selling, general and administrative expenses as a percentage of net sales were 19.6%, up slightly from last year, reflecting continued investment in marketing and brand awareness. | |
| · | Net Income: $13.9 million, or $0.91 per basic and $0.89 per diluted common share, compared to $9.0 million, or $0.61 per basic and $0.60 per diluted common share in the prior year. |
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Expanding Kefir Visibility
Lifeway recently announced social campaigns and partnerships with highly recognized names to spotlight Lifeway Kefir in front of a nationwide audience.
| · | The Company launched a social-first campaign with Chicago football stars Colston Loveland and D’Andre Swift designed to highlight the market-leading, protein-forward and probiotic-packed Lifeway drinkable kefir. | |
| · | The Company partnered with Barry’s to launch the Lifeway Power Play shake at Barry’s Fuel Bar locations nationwide, which features Organic Plain Whole Milk Kefir and delivers a protein- and probiotic-packed boost to energize workouts and support recovery. |
On-Trend Innovation
Lifeway continues to innovate and meet evolving consumer taste, expanding its product portfolio in adjacent product categories to its flagship kefir and Farmer Cheese. The Company recently announced Lifeway Kefir Butter, a probiotic, cultured butter pairing flavor with functional nutrition and available in Unsalted, Sea Salt and Honey Butter varieties. The butter category is experiencing renewed momentum, and Lifeway brings decades of experience in cultured dairy and butter production positioning the Company well to capitalize on the trend.
Outlook
The Company reiterated its long-term target of $45–$50 million in Adjusted EBITDA1 for FY 2027 and is well positioned to deliver the strongest annual sales in Company history in FY 2026.
“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 the investments we are making today in capacity, marketing and innovation position us exceptionally well to capitalize on the tremendous opportunities ahead.”
| 1. | 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 the United States, Mexico, Ireland, South Africa, United Arab Emirates, and France. Learn how Lifeway is good for more than just you at lifewayfoods.com.
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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 and the Lifeway's Quarterly Reports on Form 10-Q for the fiscal quarters ended March 31, 2025, June 30, 2025, and September 30, 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 U.S. Generally Accepted Accounting Principles (“GAAP”), and may exclude items that are significant to understanding and assessing financial results. This non-GAAP measure is provided to enhance investors’ overall understanding of the Company’s financial performance. Non-GAAP financial measures should be considered as supplements to GAAP measures reported, should not be considered replacements for, or superior to, GAAP measures reported and may not be comparable to similarly named measures used by other companies. The Company’s calculation of non-GAAP financial measures may differ from methods used by other companies.
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
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LIFEWAY FOODS, INC. AND SUBSIDIARIES
Unaudited Consolidated Balance Sheets
December 31, 2025 and 2024
(In thousands)
| December 31, | ||||||||
| 2025 | 2024 | |||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 5,571 | $ | 16,728 | ||||
| Accounts receivable, net of allowance for credit losses and discounts & allowances of $1,730 and $1,590 at December 31, 2025 and 2024, respectively | 16,643 | 15,424 | ||||||
| Inventories, net | 11,890 | 8,678 | ||||||
| Prepaid expenses and other current assets | 2,627 | 2,144 | ||||||
| Refundable income taxes | 325 | 631 | ||||||
| Total current assets | 37,056 | 43,605 | ||||||
| Property, plant and equipment, net | 48,282 | 26,862 | ||||||
| Operating lease right-of use asset | 465 | 118 | ||||||
| Goodwill | 11,704 | 11,704 | ||||||
| Intangible assets, net | 5,818 | 6,358 | ||||||
| Other assets | 2,285 | 1,900 | ||||||
| Total assets | $ | 105,610 | $ | 90,547 | ||||
| Current liabilities | ||||||||
| Accounts payable | $ | 11,008 | $ | 10,401 | ||||
| Accrued expenses | 5,413 | 5,103 | ||||||
| Accrued income taxes | 218 | – | ||||||
| Total current liabilities | 16,639 | 15,504 | ||||||
| Operating lease liabilities | 360 | 70 | ||||||
| Deferred income taxes, net | 2,792 | 3,062 | ||||||
| Total liabilities | 19,791 | 18,636 | ||||||
| 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; 15,232 and 15,100 shares outstanding at 2025 and 2024 | 6,509 | 6,509 | ||||||
| Treasury stock, at cost | (13,214 | ) | (14,052 | ) | ||||
| Paid-in capital | 3,843 | 4,632 | ||||||
| Retained earnings | 88,681 | 74,822 | ||||||
| Total stockholders’ equity | 85,819 | 71,911 | ||||||
| Total liabilities and stockholders’ equity | $ | 105,610 | $ | 90,547 | ||||
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LIFEWAY FOODS, INC. AND SUBSIDIARIES
Unaudited Consolidated Statements of Operations
For the three months and twelve months ended December 31, 2025 and 2024
(In thousands, except per share data)
Three Months Ended December 31, | Twelve months Ended December 31, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Net sales | $ | 55,361 | $ | 46,934 | $ | 212,496 | $ | 186,820 | ||||||||
| Cost of goods sold | 39,106 | 34,273 | 150,850 | 135,400 | ||||||||||||
| Depreciation expense | 892 | 764 | 3,440 | 2,846 | ||||||||||||
| Total cost of goods sold | 39,998 | 35,037 | 154,290 | 138,246 | ||||||||||||
| Gross profit | 15,363 | 11,897 | 58,206 | 48,574 | ||||||||||||
| Selling expenses | 5,428 | 3,487 | 19,891 | 14,743 | ||||||||||||
| General and administrative | 6,037 | 7,562 | 21,603 | 19,439 | ||||||||||||
| Amortization expense | 135 | 135 | 540 | 540 | ||||||||||||
| Total operating expenses | 11,600 | 11,184 | 42,034 | 34,722 | ||||||||||||
| Income from operations | 3,763 | 713 | 16,172 | 13,852 | ||||||||||||
| Other income (expense): | ||||||||||||||||
| Interest expense | (21 | ) | (3 | ) | (77 | ) | (105 | ) | ||||||||
| Fair value loss on investment | (75 | ) | – | (95 | ) | – | ||||||||||
| Gain on sale of investment | – | – | 3,407 | – | ||||||||||||
| Gain (loss) on sale of property and equipment | – | (11 | ) | – | (8 | ) | ||||||||||
| Other income | 50 | 77 | 279 | 230 | ||||||||||||
| Total other income (expense) | (46 | ) | 63 | 3,514 | 117 | |||||||||||
| Income before provision for income taxes | 3,717 | 776 | 19,686 | 13,969 | ||||||||||||
| Provision for income taxes | 1,176 | 936 | 5,827 | 4,944 | ||||||||||||
| Net income (loss) | $ | 2,541 | $ | (160 | ) | $ | 13,859 | $ | 9,025 | |||||||
| Net earnings (loss) per common share: | ||||||||||||||||
| Basic | $ | 0.17 | $ | (0.01 | ) | $ | 0.91 | $ | 0.61 | |||||||
| Diluted | $ | 0.16 | $ | (0.01 | ) | $ | 0.89 | $ | 0.60 | |||||||
| Weighted average common shares outstanding: | ||||||||||||||||
| Basic | 15,230 | 14,857 | 15,200 | 14,769 | ||||||||||||
| Diluted | 15,577 | 15,060 | 15,539 | 14,956 | ||||||||||||
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LIFEWAY FOODS, INC. AND SUBSIDIARIES
Unaudited Consolidated Statements of Cash Flows
For the Years Ended December 31, 2025 and 2024
(In thousands)
| 2025 | 2024 | |||||||
| Cash flows from operating activities: | ||||||||
| Net income | $ | 13,859 | $ | 9,025 | ||||
| Adjustments to reconcile net income to operating cash flow: | ||||||||
| Depreciation and amortization | 3,980 | 3,386 | ||||||
| Stock-based compensation | 1,947 | 2,446 | ||||||
| Non-cash interest expense | 19 | 17 | ||||||
| (Gain) loss on sale of equipment | (115 | ) | 8 | |||||
| Gain on sale of investments | (3,407 | ) | – | |||||
| Fair value loss on investment | 96 | – | ||||||
| Deferred income taxes | (270 | ) | 61 | |||||
| (Increase) decrease in operating assets: | ||||||||
| Accounts receivable | (1,219 | ) | (1,550 | ) | ||||
| Inventories | (3,212 | ) | 426 | |||||
| Prepaid expenses and other current assets | 151 | (125 | ) | |||||
| Refundable income taxes | 306 | (631 | ) | |||||
| Increase (decrease) in operating liabilities: | ||||||||
| Accounts payable | 238 | 156 | ||||||
| Accrued expenses | (1,643 | ) | 217 | |||||
| Accrued income taxes | 218 | (474 | ) | |||||
| Net cash provided by operating activities | 10,948 | 12,962 | ||||||
| Cash flows from investing activities: | ||||||||
| Purchases of property and equipment | (27,361 | ) | (6,697 | ) | ||||
| Proceeds from sale of equipment | 115 | 15 | ||||||
| Proceeds from sale of investments | 5,206 | – | ||||||
| Net cash used in investing activities | (22,040 | ) | (6,682 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Repayment of note payable | – | (2,750 | ) | |||||
| Payment of deferred financing costs | (65 | ) | – | |||||
| Net cash used in financing activities | (65 | ) | (2,750 | ) | ||||
| Net (decrease) increase in cash and cash equivalents | (11,157 | ) | 3,530 | |||||
| Cash and cash equivalents at the beginning of the period | 16,728 | 13,198 | ||||||
| Cash and cash equivalents at the end of the period | $ | 5,571 | $ | 16,728 | ||||
| Supplemental cash flow information: | ||||||||
| Cash paid for income taxes, net of (refunds) | $ | 5,588 | $ | 5,987 | ||||
| Cash paid for interest | $ | 58 | $ | 98 | ||||
| Non-cash investing activities | ||||||||
| Accrued purchase of property and equipment | $ | 774 | $ | 407 | ||||
| Right-of-use assets obtained in exchange for lease obligations | $ | 426 | $ | – | ||||
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