Once Upon A Farm (NYSE:OFRM) raised its full-year revenue outlook after reporting first-quarter fiscal 2026 sales growth of nearly 44%, driven by higher volumes, expanded distribution and stronger demand across its baby products business.
Chief Executive Officer and Co-founder John Foraker said the company was “very pleased” with its first-quarter results, citing 44% year-over-year net sales growth and a gross margin improvement of more than 300 basis points. He said business momentum accelerated during the quarter, with improvement in velocities, household penetration, repeat rates and distribution.
First-quarter sales rise as baby products more than double
President and Chief Financial Officer Larry Waldman said net sales increased 43.7% to $72.7 million from $50.6 million in the prior-year period. Volume rose 21.5%, reflecting expanded distribution and new product introductions. The company also benefited from mix and pricing, including higher kid pouch pricing compared with a year earlier and a shift toward dry baby products.
The company’s baby business was the largest driver of growth. Foraker said first-quarter baby net sales increased 112% year over year to $38.6 million, with both pouches and snacks more than doubling. He said snacks had the largest impact on total sales for the quarter, supported by distribution gains at existing retailers.
Once Upon a Farm added more than 18,000 new points of distribution across baby products in the quarter. Foraker said another reset at a mass customer in April would further increase baby distribution, making it “materially higher” by the end of the second quarter compared with the end of the first.
The kid business grew more modestly, with first-quarter sales up 5.4% to $34.1 million. Foraker said reported kid growth was affected by timing factors, including trade spending and club rotation timing, but underlying consumption remained strong. He said the company expects the kid category to deliver “mid-teens growth or better” for the full year.
Margins improve, but company maintains EBITDA outlook
Gross margin was 40.8% in the first quarter, up 308 basis points from the year-ago period. Waldman said the improvement was driven by lower cooler and slotting expense, partly offset by unfavorable product mix as dry snack growth accelerates.
SG&A expenses rose to $45.8 million, up $17.5 million from the prior-year period. Waldman said $10.9 million of the increase was attributable to stock-based compensation, new public company costs and one-time performance payments tied to the company’s February IPO.
The company reported a first-quarter net loss of $15.8 million, compared with a net loss of $19.5 million a year earlier. Adjusted EBITDA loss improved to $3.1 million from $7.5 million, helped by higher sales and margin flow-through. Waldman noted that adjusted EBITDA also benefited from the timing of about $2.5 million in marketing and cooler-related costs that shifted from the first quarter to the second.
As of March 31, 2026, Once Upon a Farm had nearly $100 million in cash and cash equivalents and no debt. Waldman said IPO proceeds were used in part to repay all outstanding borrowings under the company’s term loan facility.
Cooler productivity and innovation remain key focus areas
Foraker highlighted improving productivity in the company’s refrigerated baby cooler model. He said Once Upon a Farm ended the quarter with about 3,700 coolers in market and remains on track to reach approximately 5,000 by year-end, with a longer-term expectation of 8,000 or more in 2027.
According to Foraker, coolers were 11% more productive on average in the first quarter than in the fourth quarter of last year and 27% more productive than in the year-ago quarter.
The company recently launched refrigerated organic meat and bone broth, and legume blend pouches, which Foraker described as its first “protein-forward” cold pressure protected pouches for babies. He said the products began appearing in select retailers in April, with broader rollout planned over the next couple of quarters.
In retailers where the new SKUs have been placed, Foraker said Once Upon a Farm is seeing more than 20% increases in cooler productivity shortly after placement, though he cautioned that the early results primarily reflect trial rather than repeat purchasing.
The company also began shipping Smoothies with Protein & Probiotics into select dairy sets nationally and launched Power Wheels, an aged-up version of Tractor Wheels for kid bar sets. Foraker said it was too early to comment on velocity performance for those products, but retailer support had been strong.
Guidance raised for sales, while investment remains a priority
Based on first-quarter performance and recent trends, Once Upon a Farm raised its 2026 net sales outlook to a range of $313 million to $323 million, representing growth of 30% to 34% versus 2025. The previous guidance range was $302 million to $310 million.
Despite the higher sales outlook, the company maintained its full-year adjusted EBITDA guidance of $2 million to $4 million. Waldman said Once Upon a Farm plans to reinvest sales upside into top-line growth initiatives, people and infrastructure to support future growth.
During the question-and-answer portion of the call, Waldman said the company has built into its model a full-year fuel surcharge impact of about 100 basis points, as well as 100 basis points of tariff cost. He also said the company is accounting for mix pressure from stronger snack sales and club business.
Foraker said the company believes this is “a good time to be on offense,” given household penetration of 5.8%, strong repeat metrics and rising consumer engagement. He said the company remains confident in its ability to reach mid-teens adjusted EBITDA margins over the medium term.
Executives see continued momentum, limited competitive changes
Foraker said household penetration rose to 5.8% at the end of March from 4.5% a year earlier, while repeat rates among households with kids increased 380 basis points. He said repeat rates are approximately 50% for households with kids and approximately 60% for new families.
In response to analyst questions, Foraker said there had been no significant changes in the competitive environment or promotional intensity. He said the company continued to see positive momentum into April and was taking a conservative approach to guidance.
Foraker also discussed the club channel, saying velocities have continued to rise as consumers become more aware of the brand. He said a major national kid pouch program is running in May and that club exposure helps convert light buyers into medium buyers, increasing buy rates.
“There’s absolutely nothing in our business that shows any kind of deceleration right now,” Foraker said during the call. “In fact, it’s the exact opposite.”
About Once Upon A Farm (NYSE:OFRM)
Once Upon A Farm (NYSE: OFRM) is a U.S.-based producer of refrigerated organic foods for infants, toddlers and young children. The company’s product lineup emphasizes cold-pressed, organic purees, blends and smoothies formulated for early childhood nutrition. Its offerings are positioned around whole-food ingredients, limited processing and claims of no artificial preservatives or added sugars, with packaging designed for convenience and on-the-go feeding.
Once Upon A Farm distributes its products through a combination of retail and direct-to-consumer channels, serving customers primarily across the United States.
