Natural Grocers by Vitamin Cottage, Inc. reported record full‑year sales of $1.33 billion, up 7.2% from $1.24 billion in 2024, and net income of $46.4 million, or $2.00 per diluted share, compared with $33.9 million and $1.47 per diluted share in the prior year. The company’s fourth‑quarter revenue of $336.1 million fell 4.2% from $322.7 million in Q4 2024, but the quarter’s diluted earnings per share of $0.51 beat the consensus estimate of $0.45 by $0.06, a 13.3% beat, driven by disciplined cost management and a favorable product mix that offset the revenue shortfall.
The revenue miss of $14.9 million, or 4.24% below the $350.98 million consensus, was largely attributed to the UNFI cybersecurity incident in June 2025, which disrupted distribution and dampened sales in key categories. Despite this headwind, the company’s gross margin contracted only 10 basis points to 29.5% from 29.6% in the prior year, reflecting modest pressure on product margins while operating expenses were controlled, allowing operating margin to improve by 90 basis points.
Management highlighted a 4.2% increase in daily average comparable store sales, driven by higher transaction counts (up 2.4%) and larger transaction sizes (up 1.8%). The company also raised its quarterly cash dividend by 25% to $0.15 per share, payable December 10, 2025, and reiterated its 2026 guidance of 6–8 new store openings and diluted EPS of $2.00 to $2.15, a range that remains above the analyst consensus of $1.95.
Co‑President Kemper Isely noted that “Consumers continue to be drawn to our differentiated offering of high‑quality, natural and organic products, and our commitment to Always Affordable® pricing provides compelling value during periods of economic uncertainty.” He added that accelerated store growth remains a core strategy and that the company is confident in maintaining profitability through cost discipline and strategic investments.
Investors focused on the revenue miss, which tempered enthusiasm for the earnings beat. The company’s guidance signals confidence in future growth, but the revenue shortfall highlights ongoing distribution challenges and macro‑economic headwinds that could impact top‑line momentum in the near term.
The company’s performance underscores its resilience in a competitive grocery landscape, with strong comparable store sales growth and a solid house‑branded product mix that contributed 8.8% of total sales. However, the slight gross margin compression and revenue miss point to the need for continued focus on supply‑chain resilience and pricing strategy to sustain momentum.
The content on BeyondSPX is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.