Once Upon a Farm — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net sales increased 34.9% year-over-year to $89.1 million for the third quarter of 2026, compared to $66.0 million in the prior year period.
• Gross margin decreased to 36.1% in Q3 2026 from 42.1% in the prior year period, a 600 basis point decline driven by trade investment for a national club program, product mix, and cooler placement costs.
• Net loss narrowed to $3.8 million for Q3 2026 from $11.3 million in the prior year period, primarily due to the elimination of the non-cash change in fair value of a derivative liability.
• Adjusted EBITDA loss was $1.0 million for Q3 2026, compared to an Adjusted EBITDA profit of $0.9 million in the prior year period.
• SG&A expenses increased to $36.8 million in Q3 2026 from $28.8 million in the prior year period due to continued investment in marketing, personnel, and public-company capabilities, though SG&A as a percentage of net sales decreased to 41.3% from 43.7%.
• As of September 30, 2026, the Company held $106.4 million in cash and cash equivalents with no debt, compared to $10.9 million in cash and $60.2 million in total debt as of December 31, 2025.

Guidance and Future Outlook:

• The Company updated its full-year 2026 net sales outlook to $290 million to $300 million, down from the previous range of $327 million to $335 million, reflecting the impact of the voluntary recall of Tractor Wheels product lines on Q4.
• Full-year 2026 Adjusted EBITDA loss is now expected to be between $4.5 million and $7 million, revised from a previous profit expectation of $3 million to $4.5 million.
• Management stated that the outlook is based on information as of November 12, 2026, and may be impacted by factors outside the Company's control.

Business Segments and Product Lines:

• Q3 2026 net sales growth was driven by a 32% increase in volume, with favorable mix contributing to the remainder.
• Supplemental sales data indicates Total Baby segment sales reached $46.8 million in Q3 2026, up from $29.9 million in the prior year, while Total Kid segment sales reached $42.2 million, up from $36.1 million.
• The Company is building a "baby through kid brand" with a portfolio of organic, non-GMO snacks and meals designed for children.

Market and Competitive Landscape:

• Management highlighted increased brand awareness, household penetration, and deepened retail reach as key drivers of performance.
• The Company aims to achieve structurally higher margins and meaningful operating leverage as it scales.

Risks and Challenges:

• The voluntary recall of Tractor Wheels product lines negatively impacted Q4 2026 guidance.
• Management expressed a commitment to resolving the Tractor Wheels situation correctly to continue earning the trust of families and retailers.
• Forward-looking statements note risks including adverse public relations, product recalls, supply chain disruptions, and changes in consumer preferences.

Management Commentary and Tone:

• CEO John Foraker stated that third-quarter results demonstrated the ability to increase brand awareness and deliver value-added innovation.
• Management expressed high confidence in the future of the Company, citing conviction in the long-term opportunity and the organization's ability to act decisively in the best interests of consumers.
• The tone reflects a focus on disciplined investment and execution to build a durable growth platform.

Other Key Points:

• The Company completed its IPO in February 2026, with proceeds applied to increase net cash and decrease total debt.
• Proceeds from the issuance of common stock totaled $155.4 million during the nine months ended September 30, 2026.
• The Company repaid $43.0 million in debt during the nine months ended September 30, 2026.
• Adjusted EBITDA is a non-GAAP measure excluding items such as stock-based compensation, depreciation, amortization, and changes in fair value of derivative liabilities.