LFCR

Image source: The Motley Fool. Wednesday, Aug. 5, 2026 at 8:00 a.m. ET Manager of Investor Relations - Stephanie Diaz President and Chief Executive Officer - Paul Josephs Chief Financial Officer - Ryan Lake Operator: Good morning, and thank you for joining Lifecore earnings call for the second quarter and 6 months ended June 30, 2026. [Operator Instructions] Now I'd like to turn the call over to Stephanie Diaz, Manager of Investor Relations for Lifecore. Stephanie Diaz: Good morning, and thank you for joining us. Today, Lifecore Biomedical will provide its earnings results for the second quarter and 6 months ended June 30, 2026, and a corporate update. As the company has recently changed its fiscal year end to align with the calendar year, we will be comparing our results for the second quarter ended June 30, 2026, with the comparable prior year quarter ended May 25, 2025. For the 6-month period, we will be comparing our results from January 1 through June 30, 2026, with the prior year period from November 24, 2024, through May 25, 2025. Hosting the call today from Lifecore are Paul Josephs, President and Chief Executive Officer; and Ryan Lake, Chief Financial Officer. Before we begin, I'd like to remind everyone that today's conference call will contain forward-looking statements. It is important to note that the forward-looking statements made during this call reflect management's judgment and analysis only as of today, August 5, 2026, and the company's actual results could differ materially from those projected in such forward-looking statements. For a more thorough discussion of the risks and uncertainties associated with any forward-looking statements, please see the disclaimer regarding forward-looking statements that is included in our earnings press release, which was furnished to the Securities and Exchange Commission this morning on Form 8-K and is available on our corporate website at lifecore.com as well as our other filings with the Securities and Exchange Commission, including, but not limited, to the company's Form 10-Q for Q2 2026, which was filed with the SEC this morning and is also available on our website. In addition, our earnings press release includes a discussion of and during this call, we will reference certain non-GAAP financial information. You can find relevant non-GAAP reconciliations in our press release. With that, I'd like to turn the call over to Paul Josephs, President and Chief Executive Officer. Paul Josephs: Thank you, Stephanie. Good morning, everyone, and thank you for joining us today. During the second quarter, Lifecore continued to execute with focus and discipline against the strategic objectives we implemented over the last 24 months. We are energized by the success and progress we are making in achieving the 3 pillars of our growth strategy. As a reminder, these pillars are maximizing our existing commercial business, advancing our development pipeline towards commercialization and adding high-quality new programs to our pipeline through business development. This is a thoughtful and deliberate strategy that is designed to drive durable growth over the medium to long term and create value for our shareholders as well as our employees, customers and other key stakeholders. Building on our successful quarter and our visibility into the months ahead, we remain confident in our full year expectations and reaffirm our 2026 guidance. Ryan will provide additional details on our financial results following my overview of our Q2 achievements. I'll begin with an update on the progress we have made across all 3 pillars of our growth strategy. During the second quarter, we achieved important milestones in each of these areas. With respect to maximizing existing commercial business, we continue to work closely with our largest customer to support a significant increase in demand. Contractually committed fill/finish demand is expected to double beginning in 2027 with committed demand increasing by more than 200% in 2028 as compared to 2026. We now have clear understanding of how this inflection point in demand with our partner will be effectuated, and we are in the process of ensuring that we are operationally ready to successfully execute this important milestone. As part of this growth in demand, we will be entering new markets in partnership with this customer. In particular, I'd like to highlight the Japanese market and the inspection conducted by the Japanese Pharmaceuticals and Medical Devices Agency, or PMDA. This agency is known for its rigorous technical assessment and high-quality standards. This inspection was successful, and we are pleased with the results, marking a critical step in opening a future new market for our hyaluronic acid and aseptic fill/finish products for this customer. For the quarter, we hosted 7 separate audits and inspections, representing one of the highest numbers performed in a single quarter for Lifecore. Five of these were with existing and new customer audits, and 2 were regulatory agency inspections. It is important to note that the time associated with these activities by teams across our organization made this a uniquely demanding period at Lifecore. We are very pleased to report that we successfully completed each of these inspections and audits with no material issues reported, all while meeting the development and manufacturing needs of our current customers. During the quarter, we also made progress with regard to the second arm of our growth strategy, advancing our development pipeline towards commercialization. We believe that 11 existing development programs have the potential to commercialize by the end of 2028, and we continue to work to advance each of these programs daily. A highlight of the second quarter was Lifecore's successful completion of several process performance qualification, or PPQ, batches for a customer approaching commercialization in 2027. While PPQ programs are particularly impactful as they are a pre-commercialization requirement, we caution that the execution of a PPQ campaign is the beginning of a 1- to 2-year journey towards a potential regulatory approval and subsequent recurring commercial revenue. We have a diverse and exciting late-stage pipeline with the potential to significantly impact future revenues, capacity utilization and improved margins. We continue to execute this important work and to support each of our development programs as they move closer towards commercialization. Recognizing the importance of the late-stage programs to our mid- and long-term growth objectives, we recently added a seasoned industry veteran with more than 15 years of experience with multiple CDMOs to lead our project management efforts. She leads a team of highly talented experts who are responsible for driving our development programs towards commercialization in a professional and efficient manner. Complementing our project management efforts, our manufacturing science and technology, or MS&T, team is charged with transitioning our development stage programs towards commercialization as efficiently and as effectively as possible. This team includes experienced professionals in pharmaceutical development, and their combined focus on this important objective has improved our processes and productivity. As our development programs continue to mature towards late stage, we believe this pipeline will be an important driver of our mid- and long-term success, and we intend to continue to invest in this team and capabilities required to successfully execute this transition. We were extremely productive with the first 2 arms of our growth strategy. However, our greatest success during the period was the addition of high-quality new programs to our pipeline by our business development team, the third pillar of our growth strategy. Since I joined Lifecore in 2024, we have reorganized our commercial team with new leadership and proven business development professionals to complement our talented marketing team. We have successfully rebuilt this team with an aggressive hunter-like approach to our sales and marketing efforts, and we are building strong momentum. During the second quarter, we added 6 new programs to our pipeline, 2 of which are expected to generate commercial revenue in the 2028 to 2029 time frame. These agreements are with a combination of existing and new customers ranging in scope from preclinical to the commercial transfer of 2 currently marketed products. Three of these programs were signed during the month of June alone, reflecting the momentum of our business development team's efforts. Since the end of the quarter, we have closed another late-stage injectable program with a specialty biopharmaceutical company. This program is in addition to our 9 year-to-date new business wins through June 30 and 13 new business wins over the last 12 months. Importantly, many of the leading indicators within our business development activity and pipeline continue to trend positively. As an example, since mid last year, more than 60% of the opportunities for which we have competed on have been late-stage programs or commercial site transfers. These late-stage programs and commercial site transfers are derisked from clinical approval and come with demonstrated commercial demand, reducing the market risk associated with new drug products. Based on our current proposal activities, we are optimistic that we will continue to close additional late-stage and commercial site transfer programs during the remainder of 2026. Adding to our confidence in our ability to close additional late-stage programs are 2 significant industry tailwinds. One, the increase in FDA enforcement actions that we have recently seen at other contract manufacturers; and two, the ongoing trend of regionalized drug manufacturing in the United States. These 2 discrete trends have led to an increase in the number of potential customers seeking high-quality, technically capable contract manufacturers like Lifecore. In summary, we believe that our revamped commercial strategy, combined with favorable market dynamics, we will continue to add new and impactful opportunities to our pipeline in 2026 and beyond, contributing to our 12% revenue CAGR by the end of 2029 and providing the next wave of growth into the long term. In addition to the successes with our growth strategy objectives, we continue to make important improvements and create value across our organization. With respect to SG&A, our leadership team remains focused on identifying opportunities for enhanced efficiencies, productivity, and cost reductions. We are currently progressing more than 40 projects, each intended to explore specific cost reductions or process and productivity improvements that we expect to positively impact margins and contribute to exceeding our 25% adjusted EBITDA margin targets by 2029. It's important to note that we are not only focused on cost reductions, but also how we continue to improve the operations of our business. Enhanced systems and processes will be critical as we look forward towards the inflection point in demand with our largest customer and the potential addition of up to 11 product approvals through 2028. That concludes my update. I will now turn the call over to Ryan Lake to provide an overview of our financial results for the second quarter and 6 months ended June 30, 2026. Ryan? Ryan Lake: Thank you, Paul, and good morning, everyone. In conjunction with my comments, I'd like to recommend that participants refer to Lifecore's Form 10-Q filing, which we filed with the SEC this morning. As a reminder, we will be comparing our results for the second quarter ended June 30, 2026, with the comparable prior year quarter ended May 25, 2025. For the 6-month period, we will be comparing our results from January 1 through June 30, 2026, with the prior year period from November 24, 2024, through May 25, 2025. Before providing our financial results, I wish to reaffirm our 2026 guidance for revenue and adjusted EBITDA. As a reminder, for 2026, Lifecore expects total revenue to be in the range of $120 million to $125 million and adjusted EBITDA to be in the range of $20.5 million to $25 million. Turning now to the quarter. Revenues for the second quarter of 2026 were $34.2 million, a decrease of $2.3 million or 6.2% compared to $36.4 million for the comparable prior year quarter ended May 25, 2025. The decrease in revenues was primarily a result of the factors that we described during our fourth quarter earnings announcement as well as timing, mix and volume of other customers, including lower development revenue and a contractual take-or-pay arrangement in the prior year period, all of which were partially offset by increases in HA manufacturing revenue. We expect a step-up in CDMO revenues in the back half of the year, including higher aseptic and development revenues, and remain on track to deliver our stated revenue guidance by the end of 2026. Gross profit for the quarter was $12.1 million, a decrease of $1.9 million compared to $14 million for the comparable prior year quarter ended May 25, 2025. The decline in gross profit was primarily due to decreased revenues, unfavorable manufacturing costs and the contractual take-or-pay arrangement in the prior period, partially offset by favorable HA sales volume. Selling, general and administrative expenses for the second quarter were $8 million, a decrease of $1 million or 11.2% compared to $9 million for the comparable prior year quarter ended May 25, 2025. The decrease in SG&A expenses was primarily due to lower recurring legal and accounting expenses and lower compensation, in addition to less nonrecurring expenses primarily related to legacy legal matters. The company recorded a net loss of $6.2 million, or $0.19 of loss per diluted share, as compared to a net loss of $1.1 million and $0.06 of loss per diluted share for the comparable prior year quarter ended May 25, 2025. Adjusted EBITDA for the second quarter was $8.6 million, a decrease of $0.5 million compared to $9.1 million in the comparable prior year quarter ended May 25, 2025. I'll now review the results for the 6 months ended June 30, 2026. Revenues for the 6 months were $57.4 million, a decrease of $14.2 million, or 19.9%, compared to $71.6 million for the 6-month comparable prior year period ended May 25, 2025. The decrease in revenues was similar to the explanations provided for the 3-month period. Gross profit for the 6 months was $16.5 million, a decrease of $7.3 million compared to $23.8 million for the 6-month comparable prior year period ended May 25, 2025. The decline in gross profit was primarily due to decreased revenues, product mix, unfavorable manufacturing costs and the contractual take-or-pay arrangement in the prior period. Selling, general and administrative expenses for the 6 months were $15.9 million, a decrease of $3.2 million, or 16.7%, compared to $19.1 million for the 6-month comparable prior year period ended May 25, 2025. The decrease in SG&A expenses was primarily due to lower recurring legal and accounting expenses and lower compensation, in addition to a reduction in nonrecurring expenses primarily related to legacy legal matter. The company recorded a net loss of $21.1 million and $0.61 of loss per diluted share as compared to a net loss of $15.9 million and $0.48 of loss per diluted share for the 6-month comparable prior year period ended May 25, 2025. Adjusted EBITDA for the 6-month period was $9.6 million, a decrease of $5.1 million compared to $14.8 million for the 6-month comparable prior year period ended May 25, 2025. I'd like to expand upon Paul's comments regarding our cost reduction activities. We are pleased to share that the second quarter of 2026 represents the fifth consecutive quarter of period-over-period declines in SG&A and R&D expenses and a cumulative total of $16.2 million since we started these initiatives in late 2024. These include substantial reductions in accounting, consulting and legal expenses, which drove the incremental improvements we recorded in EBITDA margins during 2025, and as reflected in our 2026 guidance, we expect continued reductions to support that trend in the future. Finally, I'd like to note that liquidity has improved significantly since late 2024. We ended the second quarter of 2026 with approximately $38.8 million in liquidity, including cash of $17.2 million and revolving credit availability of $21.6 million. That concludes my financial overview. I'll now turn the call back over to Paul for his final comments. Paul? Paul Josephs: Thank you, Ryan. To summarize, the second quarter was highly productive. We believe that many of our accomplishments during the period affirm the effectiveness of our new business development strategy, the growing value of our pipeline, our commitment to optimizing the transition of our development pipelines towards commercialization and our focus on maintaining our exceptional track record in quality and compliance. Furthermore, we now have line of sight to the doubling of the fill/finish demand with our largest customer beginning in 2027. In addition, Lifecore continues to invest in the talent, processes and improvements that we believe will support our growth in the midterm and allow us to achieve sustainable long-term profitability into the future. This concludes our prepared remarks for today. Operator, you may now open this call for questions. Operator: [Operator Instructions] Our first question will be coming from the line of Matt Hewitt of Craig-Hallum. Matthew Hewitt: Congratulations on all of the progress that you made this quarter. Maybe first question, with the Alcon ramp that's expected to start next year, does that start on day 1, January 2, will you see that inflection? Or is that going to ramp over the course of the year? Paul Josephs: Thanks for the question. I would say that it is -- there's -- it starts earlier in '26, I would say, with a slightly heavier weighting on the back end of '27 -- excuse me. So starting early in '27 with a heavier weighting on the back end -- slightly heavier weighting on the back end. Matthew Hewitt: Got it. And then obviously, you've had a lot of success over the past year with new wins. And I'm just curious, is this a function -- and I think you touched on this a little bit in your prepared remarks, but is this a function of reshoring? Is this a function of some of the excess capacity that you have that maybe others don't? Is it because of your ability to manufacture and implement special fill/finish capabilities? Like, what do you think is ultimately driving the wins that you've announced? Paul Josephs: Yes, and is how I would answer that, Matt. It's the regionalization of manufacturing, but it's also FDA enforcement is up. I mentioned that in my prepared remarks. FDA warning letters are up approximately 50% year-on-year. So we're seeing the benefit of customers looking for high-quality sterile injectable suppliers with strong technical capabilities like Lifecore. And when you tag that along with the fact that 50% of the FDA or the drug development pipeline are injectables, there's strong tailwinds in our market, and we have a highly talented team that's taking advantage of that. Operator: Our next question is coming from the line of Paul Knight from KeyBanc Capital Markets. Paul Knight: I know there was some press release regarding the preferred. Where are you with that particular instrument? Ryan Lake: Thanks for the question. So a few items. Our liquidity position is the best it's been in years with the performance and operational improvements that we've made. I think as you think about the Series A preferred, any potential payment, first, would not be due until December 28. We believe that we would also need approval under our credit agreements to make any of those payments. And any outstanding amounts, if not paid, would accrue interest at 1% per month until resolved. Paul Knight: Okay. And then, Paul, on these wins, are you -- when you talk about fill/finish, is it vials? Is it cartridges for auto-injectors and pens? What type of fill/finish are you seeing? Paul Josephs: Thanks for the question. I would say heavily weighted to the prefilled syringe. Paul Knight: And typically, of course, I guess, biologics is in? Paul Josephs: Yes. We've had -- the nice thing for us, Paul, is -- or what we're seeing, I think, is evidence that our strategy is working. We see now a broader scope of modalities that we're working on, including biologics. I think we -- you'll see in our investor -- updated investor deck now 9 different modalities that we've won deals on over the past year or so. So the strategy is working, and we're taking advantage of the opportunities within the market. Paul Knight: Are you -- and lastly, are you seeing any interest due to the onshoring efforts that might be going on? Paul Josephs: Absolutely. So a number of the programs, I don't have the exact number in front of me, but we've had -- we've won opportunities now that will come to us from Europe, Asia-Pacific, excuse me, Europe, Israel and India. Operator: Our next question is coming from the line of Mac Etoch of Stephens. Steven Etoch: Apologies if you addressed this in the prepared remarks, but the HA manufacturing pretty strong in the quarter. Given some of the timing aspects that you highlighted at the start of the year, was there any change in how those flowed through versus initial expectations? Ryan Lake: Thanks for the question. So we are very excited about the performance in the quarter and all the new business momentum that we've seen over the past 12 months and even a higher accelerated level of adding new and impactful programs to our pipeline over the past 6 months. Based on our performance in the first half, revenue expectations in the second half at the midpoint of our guidance range is in the $65 million range and adjusted EBITDA is in the $13 million range. So HA demand was strong in the quarter, but really just timing first half versus second half and in line with our full year expectations. We do expect a strong performance in CDMO revenues in the back half of the year, including higher aseptic demand as well as higher development revenues, and remain on track to deliver both our revenue and EBITDA guidance by the end of 2026. And based on the timing of orders that we do have in hand, it will be a little bit more weighted toward Q4. I'd also say that just generally speaking, from an EBITDA and cost perspective, we're ahead of where we anticipated to be, both costs and timing in terms of improving our operating costs. And you will have seen SG&A slipped down below $8 million a quarter for the past couple of quarters, and we expect further improvements in the back half of the year and anticipate that SG&A, excluding any onetime items, would be in the $6 million a quarter range. Steven Etoch: I appreciate that. And given the elevated level of new wins that you've been announcing over the last year or so, I guess I just want to understand how the utilization expectations for the midterm targets has evolved. Is there any incremental CapEx? Or could you move towards the Site 3 optionality? Could that -- essentially could that become more relevant quicker than expected? Paul Josephs: Mac, thanks for the question. I would say that we are -- we couldn't be more excited about the progress. And certainly, the organization is energized by it. I think the new business wins continue to give us great optimism with regard to our midterm objectives of 12% CAGR and greater than 25% EBITDA margins by the end of 2029, and we feel as though we're right on track. And based on that, we'd be utilizing 60% of our already installed capacity that's available to us. As we move closer, we'll continue to evaluate opportunities, whether it's Site 3 for incremental capacity or other options as we continue to move down the road. But right now, we have all the capacity to meet our midterm objectives and still with a little bit -- with headroom to grow beyond that. Operator: And our next question is coming from the line of Jared Haase of William Blair. Christine Rains: It's Christine Rains on for Jared. First, congrats on the quarter. And then as to the question, hoping maybe, Ryan, you can dig a little bit more into your comments on more back half Q4 results more being weighted to Q4, if that's more of a revenue or an EBITDA comment or both? And it seems like related to order timing, but maybe if you could provide some rough sort of quantification of the split between Q3 and Q4. Ryan Lake: Yes. Christine, thanks for the question. It's really just timing of the orders that we have in-house already, causing that weighting to be a little bit more back-end weighted to Q4. But again, I think importantly, we're on track to deliver both our revenue and EBITDA guidance for the year. Christine Rains: Great. That's good to hear. And then looking a bit ahead at your anticipated revenue and volume inflection in 2027 and 2028, it sounds like from a capital allocation standpoint, in terms of CapEx, you guys seem to be in a good place with evaluating based on your pipeline. Curious if capacity is ample for your pipeline, would this be an opportunity to shift more of your free cash flow towards debt reduction and sort of lowering your interest costs? Ryan Lake: So I would say the investments that we've made over the past 5 years really support our growth throughout the midterm. And our projections have us being at about 60% capacity in 2029. We've continued to make really important strides from a free cash flow perspective. And I do think there's opportunities for us. And I think notably, even within the quarter, Christine, we began paying a portion of our debt service in cash as opposed to payment-in-kind. And that's what we've done in the prior quarters, and we view that as a milestone and continued reflection of our improving free cash flow generation. And really pleased as well with all the work that we've been doing from a working capital perspective to reduce inventories and to be able to start paying some of that debt service. Operator: Our next question is coming from the line of Michael Petusky of Barrington Research. Michael Petusky: So Ryan, I just want to make sure I heard something correctly. Were you saying essentially that the sort of the $7 million, $9 million, $8 million a quarter in SG&A, you think that can trend down towards $6 million, did I hear that correctly, per quarter? Ryan Lake: You did, Michael. Michael Petusky: And that starts somewhere in the second half? Ryan Lake: That's correct. Michael Petusky: Wow. Okay. All right. And then just sort of following on to the previous question around free cash. You guys have generated, it looks like almost $4.5 million for the first half. And I'm just curious, would you expect sort of a roughly something similar in the second half in terms of true free cash or possibly anything above that? Ryan Lake: Yes. I think that we are expecting free cash flow generation for the year to be probably in that $7 million to $10 million range. So it would kind of say that the second half and obviously, based on the EBITDA performance in the second half as well being stronger than the first half, that would follow the free cash flow generation. I think some of the onetime items were higher in the first half than what we previously anticipated, but there's still a lot of puts and takes as it relates to the cash outlook for 2026, and it's dependent on a number of things, including those items related to legacy matters, the timing of some of our CapEx and any potential payments of Series A. Michael Petusky: Okay. And just quickly jumping back to the preferred holder redemption notice from, I guess, a month or so ago. When you guys think about your liquidity needs, where can you comfortably run this business? You're at $38.8 million now. I mean, if you wanted to pay off those preferred holders, I mean, how -- what kind of liquidity do you feel like you need to run the business on a sort of comfortable basis? I understand we're looking ahead several months here before you have to sort of make decisions around this. But I'm just curious if you would be willing to share just a sense of what level of liquidity is sort of a comfort level for you guys? Ryan Lake: Michael, I'd say it's really going to be dependent on the facts and circumstances at that time. Certainly, we want to make sure that we retain enough cash to meet the compliance requirements under our debt agreements as well as to be able to fund the future growth of the business. Michael Petusky: Okay. And then I guess, Paul, one for you. Obviously, you guys have had some really fantastic success in terms of new business wins. And obviously, you got the larger customer going to be ramping up here in the next year to 2 years in a meaningful way. As you sort of think about the sort of the employee footprint of the business, what you're going to need to sort of service these customers, I would assume that you have to add people resources, and obviously, I was talking about -- somebody else was talking about Site 3, et cetera. Can you just talk about how you might need to prepare as '27 turns to '28 and then beyond? Paul Josephs: Mike, thanks for the question. What I would tell you is that certainly, from an indirect and SG&A perspective, we don't expect a significant amount of incremental adds to support the demand. We really believe that we'll be able to get leverage over our existing headcount. There will be some nominal adds in that area. We will, though, spend time and effort in adding resources and potentially different resources to support our development efforts as that continues to grow a bigger and bigger piece of what we do day in, day out, and supporting those projects from development through commercialization. But primarily, it will be a direct labor and direct supervision equation as it relates to the incremental headcount that we'll add to the organization. As in a CDMO our size, we want to make sure that we don't get too far ahead of ourselves, that we have the right labor in place for the demand that we have today. So we have a great HR team. We have a plethora of talent here within the Minneapolis-St. Paul area. So I'm very confident in our ability to, again, add the right talent at the right time to support the ongoing needs of our customers, both from a development and commercialization perspective. Michael Petusky: Paul, can I sneak one final one in for you? Just in terms of the success you've had in terms of new business signings and particularly late-stage and commercial site transfers, does the success you've had, does it change -- does it sort of change the hurdle rate as you move forward in terms of new business agreements you're willing to sign and not willing to sign? And essentially, I'm asking, do early-stage or smaller deals essentially almost become not worth signing given the momentum you've got and how much you have to do and seemingly the pipeline of potentially late-stage deals that you still are working on? Paul Josephs: Mike, thanks for the question. It sounds like you were actually in our leadership meeting a little over a month ago. We've had great success, which now allows it -- we're very humbled by it, but remain very hungry. But as we think about our ideal customer profile, that's beginning to evolve based on our success. And we'll always continue to put a heavier lean on late-stage and commercial site transfers because they are derisked from a commercial standpoint, and this is all about being -- this is a recurring revenue business. But we won't shy away from the early phase programs, but we'll certainly price those maybe a little bit differently, knowing that the success and churn rate is certainly a lot higher than your late-stage or commercial site transfers. Great question. It's something that we've been talking about a lot about lately. Operator: Thank you. And that concludes today's Q&A session. I would like to turn the call back over to Paul for closing remarks. Please go ahead. Paul Josephs: Thank you, operator. I wish to thank all of Lifecore's stakeholders and supporters, including our investors, customers and collaborators, for their ongoing support and partnership. I also wish to thank our dedicated employees for their commitment to our success as well as the success of our customers. Our accomplishments during the first half of the year continue to fuel our optimism, and we look forward to the opportunities ahead. That concludes our call today. Thank you for participating. Operator: That concludes today's program, and thank you so much for participating. You may now disconnect. Before you buy stock in Lifecore Biomedical, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Lifecore Biomedical wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $403,337!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,334,946!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of August 12, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has positions in and recommends Lifecore Biomedical. The Motley Fool has a disclosure policy. Lifecore Biomedical (LFCR) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management attributes recent business development success to a 'hunter-like' sales approach and two specific industry tailwinds: increased FDA enforcement actions at competitors and the ongoing trend of regionalized drug manufacturing in the U.S. The company is preparing for a significant inflection point with its largest customer, where contractually committed fill/finish demand is expected to double in 2027 and increase by more than 200% in 2028 compared to 2026 levels. Strategic focus has shifted toward late-stage programs and commercial site transfers, which now represent more than 60% of the competitive pipeline, effectively derisking future revenue by targeting products with demonstrated market demand. Operational intensity was high during Q2, with the team hosting seven separate audits and inspections—one of the highest volumes in company history—including a successful PMDA inspection for the Japanese market. The company is leveraging its manufacturing science and technology (MS&T) team to bridge the gap between development and commercialization, aiming to transition 11 existing programs to commercial status by the end of 2028. Cost-reduction initiatives remain a core focus, with over 40 active projects targeting process improvements and productivity to support the long-term goal of exceeding 25% adjusted EBITDA margins by 2029. Full-year 2026 guidance is reaffirmed with revenue expected between $120 million and $125 million, assuming a significant step-up in CDMO and aseptic revenues in the second half of the year. Second-half performance is projected to be weighted toward Q4 based on current order timing, with an anticipated $65 million in revenue and $13 million in adjusted EBITDA at the midpoint. Management expects SG&A expenses to continue trending downward, targeting a run rate of approximately $6 million per quarter in the back half of 2026, excluding one-time items. The 2027 demand ramp for the company's largest customer is expected to begin early in the year with a slightly heavier weighting toward the second half of 2027. Midterm strategic targets through 2029 assume a 12% revenue CAGR and utilize approximately 60% of currently installed capacity, leaving headroom for growth without immediate large-scale CapEx. Liquidity improved to $38.8 million at quarter-end, and the company reached a milestone by paying a portion of debt service in cash rather than payment-in-kind (PIK). Management addressed the Series A preferred stock, noting that while a redemption notice was received, no payment is due until December 2028 and would require approval under existing credit agreements. The company successfully completed several process performance qualification (PPQ) batches, though management cautioned these represent the start of a 1- to 2-year journey before recurring commercial revenue begins. Free cash flow for the full year 2026 is projected to be in the $7 million to $10 million range, though this remains subject to the timing of legacy legal matters and capital expenditures. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management cited a 50% year-over-year increase in FDA warning letters at other manufacturers as a primary driver for customers seeking high-quality, technically capable domestic suppliers. The company is seeing increased interest in 'onshoring' with recent wins coming from customers previously manufacturing in Europe, Asia-Pacific, Israel, and India. Due to high demand, Lifecore is becoming more selective, prioritizing late-stage and commercial site transfers that offer recurring revenue with lower clinical risk. Early-stage programs will still be considered but may face different pricing structures to account for the higher churn rate compared to late-stage opportunities. Management expects to achieve significant leverage over existing SG&A and indirect headcount, with new hires primarily focused on direct labor and supervision to meet production volume. The company intends to utilize the deep talent pool in the Minneapolis-St. Paul area to scale resources just-in-time as demand materializes. New business wins are heavily weighted toward prefilled syringes, which align with the company's core technical strengths. The company has expanded its scope to include nine different modalities, including an increasing number of biologic programs.

This article first appeared on GuruFocus. Revenue: $34.2 million in Q2 2026, a decrease of 6.2% compared to $36.4 million in the prior-year quarter. Gross Profit: $12.1 million in Q2 2026, down from $14 million in the prior-year quarter. SG&A Expenses: $8 million in Q2 2026, an 11.2% decrease from $9 million in the prior-year quarter. Net Loss: $6.2 million, or $0.19 loss per diluted share, compared to a net loss of $1.1 million ($0.06 per share) in the prior-year quarter. Adjusted EBITDA: $8.6 million in Q2 2026, down from $9.1 million in the prior-year quarter. Six-Month Revenue: $57.4 million, a 19.9% decrease from $71.6 million in the prior-year period. Six-Month Gross Profit: $16.5 million, down from $23.8 million in the prior-year period. Six-Month SG&A Expenses: $15.9 million, a 16.7% decrease from $19.1 million in the prior-year period. Six-Month Net Loss: $21.1 million, or $0.61 loss per diluted share, compared to a net loss of $15.9 million ($0.48 per share) in the prior-year period. Six-Month Adjusted EBITDA: $9.6 million, down from $14.8 million in the prior-year period. Liquidity: Approximately $38.8 million at the end of Q2 2026, including $17.2 million in cash and $21.6 million in revolving credit availability. 2026 Guidance: Reaffirmed total revenue in the range of $120 million to $125 million and adjusted EBITDA in the range of $20.5 million to $25 million. Warning! GuruFocus has detected 5 Warning Signs with LFCR. Is LFCR fairly valued? Test your thesis with our free DCF calculator. Release Date: August 05, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Successfully completed seven audits and inspections, including a PMDA inspection for the Japanese market, with no material issues reported. Added six new programs to the pipeline in Q2, including two expected to generate commercial revenue in 2028-2029, with a total of nine new wins year-to-date. Contractually committed fill-finish demand from largest customer is expected to double in 2027 and increase by more than 200% in 2028 compared to 2026. SG&A expenses decreased for the fifth consecutive quarter, with cumulative cost reductions of $16.2 million since late 2024. Liquidity improved significantly to $38.8 million, including cash of $17.2 million and revolving credit availability of $21.6 million. Benefiting from industry tailwinds including increased FDA enforcement actions at competitors and regionalization of drug manufacturing in the U.S. Q2 revenues decreased 6.2% year-over-year to $34.2 million, primarily due to timing, mix, and lower development revenue. Net loss widened to $6.2 million in Q2, compared to a net loss of $1.1 million in the prior-year quarter. Six-month revenues declined 19.9% year-over-year to $57.4 million, with gross profit down $7.3 million. Adjusted EBITDA for the six-month period decreased to $9.6 million from $14.8 million in the prior-year period. Potential payment of Series A preferred dividends, due December 2028, may require approval under credit agreements and accrue interest at 1% per month if unpaid. Q: With the ramp in demand from your largest customer expected to begin in 2027, will this inflection point be immediate on January 1st, or will it ramp up over the course of the year? A: Paul Josephs (CEO) stated that the increase in demand will begin early in 2027, with a slightly heavier weighting on the back end of the year rather than a sudden spike on day one. Q: What are the primary drivers behind the recent success in winning new business, and is it due to reshoring, excess capacity, or specific fill-finish capabilities? A: Ryan Lake (CFO) attributed the success to a combination of the regionalization of drug manufacturing and increased FDA enforcement actions, which are up approximately 50% year-over-year. This has led customers to seek high-quality sterile injectable suppliers like Lifecore, especially given that 50% of the drug development pipeline consists of injectables. Q: Can you provide an update on the Series A preferred stock and the company's liquidity position? A: Paul Josephs (CEO) noted that the company's liquidity is the best it has been in years. Any potential payment on the Series A preferred would not be due until December 2028, and would require approval under their credit agreements. If not paid, outstanding amounts would accrue interest at 1% per month until resolved. Q: What type of fill-finish formats are you seeing in your new business wins, and are you seeing interest due to onshoring efforts? A: Ryan Lake (CFO) stated that the new wins are heavily weighted toward pre-filled syringes. Paul Josephs (CEO) added that they are seeing a broader scope of modalities, including biologics, and have won deals across nine different modalities. He confirmed that onshoring is a factor, with new opportunities coming from Europe, Israel, and India. Q: Given the strong HA manufacturing performance in the quarter, was there any change in how the timing of revenues flowed through versus initial expectations? A: Paul Josephs (CEO) explained that HA demand was strong, but the revenue timing is in line with full-year expectations. He reaffirmed guidance, expecting second-half revenue at the midpoint of ~$65 million and adjusted EBITDA of ~$13 million, with a stronger performance in CDMO revenues and a weighting toward Q4 based on orders in hand. Q: With the elevated level of new wins, how have utilization expectations for the midterm target evolved, and could Site 3 optionality become relevant sooner than expected? A: Ryan Lake (CFO) stated that the new wins give them confidence in achieving their midterm objectives of a 12% CAGR and greater than 25% EBITDA margins by 2029. They expect to utilize about 60% of their already installed capacity by then, and they have all the capacity needed to meet their midterm objectives without needing Site 3 in the near term. Q: Can you provide more detail on the back-half weighting toward Q4, and is that a revenue or EBITDA comment? A: Paul Josephs (CEO) clarified that the weighting toward Q4 is simply due to the timing of orders already in hand. He reiterated that the company remains on track to deliver both its revenue and EBITDA guidance for the year. Q: With ample capacity for your pipeline, would you shift more free cash flow towards debt reduction and lowering interest costs? A: Paul Josephs (CEO) noted that investments made over the past five years support their midterm growth. He highlighted that they have begun paying a portion of their debt service in cash, rather than payment-in-kind, which is a milestone reflecting improved free cash flow generation and working capital management. Q: Can you confirm that SG&A expenses can trend down towards $6 million per quarter, and what is the free cash flow expectation for the year? A: Paul Josephs (CEO) confirmed that SG&A is expected to trend down to the $6 million per quarter range in the second half. Ryan Lake (CFO) added that they expect free cash flow generation for the year to be in the $7 million to $10 million range, with the second half being stronger than the first. Q: Given the success in signing late-stage and commercial site transfer deals, does this change your hurdle rate for new business agreements, and will you shy away from early-stage deals? A: Paul Josephs (CEO) stated that their success has allowed them to evolve their ideal customer profile, placing a heavier emphasis on late-stage and commercial site transfers due to their de-risked nature. However, they will not shy away from early-phase programs but will price them differently, given the higher churn rate associated with them. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

-- Reaffirms 2026 Guidance -- -- Multiple New Business Wins, Adding Impactful Programs to Pipeline -- -- Cost Reduction and Productivity Enhancements Continue to Strengthen Organization -- Conference Call Today at 8:00am ET CHASKA, Minn., Aug. 05, 2026 (GLOBE NEWSWIRE) -- Lifecore Biomedical, Inc. (NASDAQ: LFCR) (“Lifecore”), a fully integrated injectables contract development and manufacturing organization (“CDMO”), today announced results for the second quarter and six months ended June 30, 2026. CEO Commentary “The second quarter was highly productive. The effectiveness of our new business development strategy has helped us grow the value of our pipeline with consistent wins that point to our manufacturing expertise as well as our exceptional track record in quality and compliance. In addition, Lifecore continues to transition our development pipeline toward commercialization and invest in the talent, processes, and improvements that we believe will support our growing pipeline in the mid-term and allow us to achieve sustainable, long-term profitability in the future. In the past 12 months, we have added 13 new programs to our pipeline, eight of which are late stage. We expect these programs and their financial contributions to play a significant role in Lifecore’s success in achieving our long-term growth objectives of a 12% revenue CAGR and Adjusted EBITDA* margin targets exceeding 25% by the end of 2029,” stated Paul Josephs, president and chief executive officer of Lifecore. Financial Snapshot and Recent Developments Revenues for the second quarter of 2026 were $34.2 million, a decrease of $2.3 million, or 6.2% compared to $36.4 million for the comparable prior year quarter ended May 25, 2025. Revenues for the six months ended June 30, 2026, were $57.4 million, a decrease of $14.2 million, or 19.9% compared to $71.6 million for the six-month comparable prior year period ended May 25, 2025. Gross profit for the quarter was $12.1 million, a decrease of $1.9 million compared to $14.0 million for the comparable prior year quarter ended May 25, 2025. Gross profit for the six months ended June 30, 2026, was $16.5 million, a decrease of $7.3 million compared to $23.8 million for the six-month comparable prior year period ended May 25, 2025. Operating expenses for the second quarter were $9.5 million, an increase of $0.9 million, or 9.9%, compared to $8.7 million for the comparable prior year quarter ended May 25, 2025. Operating expenses for the six months ended June 30, 2026, were $18.6 million, a decrease of $8.9 million, or 32.3%, compared to $27.5 million for the six-month comparable prior year period ended May 25, 2025. Cash from operations was $2.5 million and free cash flow* was $0.9 million for the six months ended June 30, 2026. Net loss for the second quarter of 2026 was $6.2 million and $0.19 of loss per diluted share, as compared to net loss of $1.1 million and $0.06 of loss per diluted share, for the comparable prior year quarter ended May 25, 2025. Net loss for the six months ended June 30, 2026, was $21.1 million and $0.61 of loss per diluted share, as compared to net loss of $15.9 million and $0.48 of loss per diluted share, for the six-month comparable prior year period ended May 25, 2025. Adjusted EBITDA* for the second quarter was $8.6 million, a decrease of $0.5 million compared to $9.1 million for the comparable prior year quarter ended May 25, 2025. Adjusted EBITDA* for the six months ended June 30, 2026, was $9.6 million, a decrease of $5.1 million compared to $14.8 million for the comparable six-month prior year period ended May 25, 2025. Ended the second quarter of 2026 with approximately $38.8 million in liquidity, including cash of $17.2 million and revolving credit availability of $21.6 million. Signed six new programs in the second quarter of 2026, including two commercial stage programs. Signed a total of 13 programs over the last 12 months, including eight late-stage programs. Progressed more than 40 projects intended to promote cost reductions or productivity improvements that are expected to positively impact margins in the near term and contribute to the achievement of 25% Adjusted EBITDA* margin targets by the end of 2029. Completed five customer audits and two regulatory inspections during the second quarter of 2026, representing one of the highest numbers of audits performed in a single quarter for Lifecore. The company successfully completed each of the audits, which we believe validates the company’s growing reputation as a partner-of-choice for customers seeking exceptional quality and compliance. *   Adjusted EBITDA and free cash flow are non-GAAP financial measures and exclude certain items from net income or loss and operating cash flows, respectively, the nearest comparable measures calculated and presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Please see “Non-GAAP Financial Information” below for more information, including definitions of Adjusted EBITDA and free cash flow and reconciliations to net loss and operating cash flows, respectively, for the periods noted in this press release. Supplemental Financial Data To provide meaningful period-over-period comparisons, Lifecore has compared the three and six months ended June 30, 2026, to the comparable prior year periods ended May 25, 2025. This presentation is intended to comply with Securities and Exchange Commission (“SEC”) requirements applicable to fiscal year changes and is intended to assist investors with understanding the changes in the company’s operating results and financial condition. Supplemental Revenue and Gross Profit Data Supplemental Operating Expense Data Financial Guidance for Calendar Year 2026 The company is reaffirming its revenue and Adjusted EBITDA guidance for calendar year 2026. The company is not providing forward-looking guidance for U.S. GAAP net loss or a quantitative reconciliation of its 2026 Adjusted EBITDA to the most directly comparable U.S. GAAP measure, U.S. GAAP net loss, because it is unable to predict with reasonable certainty the ultimate outcome of certain significant items, including restructuring expenses, reorganization expenses, asset impairments, litigation settlements and other contingencies, changes to the fair value of the debt derivative liability, certain other gains or losses, and income tax accounting, as certain of these items have not occurred, are out of the company's control and/or cannot be reasonably predicted without unreasonable effort. These items are uncertain, depend on various factors, and could have a material impact on U.S. GAAP reported results for the guidance period. The company expects revenue to be in the range of $120 to $125 million and Adjusted EBITDA* to be in the range of $20.5 – $25 million. This guidance is based on the expectation that Lifecore would adjust for items similar to its historic definition of Adjusted EBITDA. This guidance takes into consideration existing market forces, contracts, and customer order timing, as well as the company’s current beliefs and estimations with respect to success and timing related to growing and diversifying the company’s new business development revenue. Please see “Non-GAAP Financial Information” below for more information. Earnings Webcast Lifecore Biomedical will host a conference call today, August 5, 2026, at 8:00 a.m. ET to discuss the company’s financial results for the second quarter ended June 30, 2026. The webcast can be accessed via Lifecore’s Investor Events & Presentations page at: https://ir.lifecore.com/events-presentations. An archived version of the webcast will be available on the website for 30 days. About Lifecore Biomedical Lifecore Biomedical, Inc. (Nasdaq: LFCR) is a fully integrated contract development and manufacturing organization (CDMO) that offers highly differentiated capabilities in the development, fill and finish of sterile injectable pharmaceutical products in syringes, vials, and cartridges, including complex formulations. As a leading manufacturer of premium, injectable-grade hyaluronic acid, Lifecore brings more than 40 years of expertise as a partner for global and emerging biopharmaceutical and biotechnology companies across multiple therapeutic categories to bring their innovations to market. For more information about the company, visit Lifecore’s website at www.lifecore.com. Non-GAAP Financial Information In addition to providing financial measurements based on generally accepted accounting principles in the United States of America (GAAP), this press release contains non-GAAP financial information. Adjusted EBITDA and free cash flow are non-GAAP measures and exclude certain items from net income or loss and operating cash flows, respectively, which are the most directly comparable financial measures calculated in accordance with GAAP. See the section entitled “Non-GAAP Financial Reconciliations” below for the company’s definitions of Adjusted EBITDA for the three and six months ended June 30, 2026, and free cash flows for the six months ended June 30, 2026, and the comparable prior year periods ended May 25, 2025, and reconciliations thereof to net income or loss and operating cash flows for the relevant periods. The company has disclosed these non-GAAP financial measures to supplement its consolidated financial statements presented in accordance with GAAP. These non-GAAP financial measures exclude/include certain items that are included in the company’s results reported in accordance with GAAP because we believe they are not reflective of our core operations or indicative of our ongoing operations. Management believes these non-GAAP financial measures provide useful additional information to investors about trends in the company’s operations and are useful for period-over-period comparisons. Management uses Adjusted EBITDA and free cash flow, in addition to GAAP financial measures, to monitor trends in the company’s operations, understand and compare operating results, and monitor cash flows across accounting periods, for financial and operational decision making, for planning and forecasting purposes, and with respect to Adjusted EBITDA as a measure of performance for compensation decisions. These non-GAAP financial measures should not be considered in isolation or as a substitute for the comparable GAAP measures. In addition, these non-GAAP financial measures may not be the same as similar measures provided by other companies due to the potential differences in methods of calculation and items being excluded/included. These non-GAAP financial measures should be read in conjunction with the company’s consolidated financial statements presented in accordance with GAAP. Important Cautions Regarding Forward-Looking Statements This press release contains forward-looking statements regarding future events and our future results that are subject to the safe harbor created under the Private Securities Litigation Reform Act of 1995 and other safe harbors under the Securities Act of 1933 and the Securities Exchange Act of 1934. Words such as “anticipate”, “estimate”, “expect”, “project”, “aim,” “designed to,” “plan”, “intend”, “believe”, “may”, “might”, “will”, “should”, “can have”, “likely” and similar expressions are used to identify forward-looking statements. In addition, all statements regarding our future financial and operating performance and strategy, including the reaffirmation of our 2026 guidance; the transition of our development pipeline toward commercialization; our growing pipeline and expectation for sustainable, long-term profitability in the future; our long-term growth objectives of a 12% revenue CAGR and Adjusted EBITDA* margin targets exceeding 25% by the end of 2029; the ongoing projects that we expect to promote cost reductions and productivity improvements; and our growing reputation as a partner-of-choice for customers seeking exceptional quality and compliance, are forward-looking statements. All forward-looking statements involve certain risks and uncertainties that could cause actual results to differ materially, including such factors as, among others, the timing and amount of future expenses, revenue, net income (loss), Adjusted EBITDA, cash flow and capital requirements, and timing and availability of and the need for additional financing; our ability to maintain or expand our relationships with our current customers, including the impact of changes in consumer demand for the products we manufacture for our customers; our ability to grow and diversify our business with new customers, including the potential loss of development customers if they do not receive required funding or regulatory approvals or for other reasons; our ability to comply with covenants under our credit agreements and to pay required interest and principal payments when due; our ability to fund or pay redemptions of shares of the outstanding Series A Convertible Preferred Stock in accordance with their terms; our ability to raise additional capital for ongoing needs, including through equity financing, debt financing, collaborations, strategic alliances or licensing arrangements; the impact of macroeconomic events or circumstances on our operations and financial performance, including inflation, tariffs, interest rates, social unrest and global instability; the performance of our third-party suppliers; pharmaceutical industry market forces that may impact our customers’ success and continued demand for the products we produce for those customers; our ability to recruit or retain key scientific, technical, business development, and management personnel and our executive officers; our ability to comply with stringent U.S. and foreign government regulation in the manufacture of pharmaceutical products, including current Good Manufacturing Practice, or cGMP; the outcome and cost of existing and any new litigation or regulatory proceedings; and other risk factors set forth from time to time in the company’s filings with the Securities and Exchange Commission (the “SEC”), including, but not limited to, the Annual Report on Form 10-KT for the transition period ended December 31, 2025 (the “December 2025 10-KT”). For additional information about factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to our filings with the SEC, including the risk factors contained in the December 2025 10-KT. Forward-looking statements represent management’s current expectations as of the date hereof and are inherently uncertain. Except as required by law, we do not undertake any obligation to update forward-looking statements made by us to reflect subsequent events or circumstances. Lifecore Biomedical, Inc. Contact Information: Stephanie Diaz (Investors)Vida Strategic [email protected] Jennifer Arcure (Media)Vida Strategic [email protected] Ryan D. Lake (CFO)Lifecore [email protected] Non-GAAP Financial Reconciliations Adjusted EBITDA is a non-GAAP financial measure and excludes certain items from net income or loss, the most directly comparable financial measure calculated in accordance with GAAP. For the periods presented herein, we defined Adjusted EBITDA as net income or loss before (i) interest expense, net of interest income, (ii) income tax expense or benefit, (iii) depreciation, (iv) stock-based compensation, (v) change in fair value of debt derivatives, (vi) franchise tax, (vii) reorganization costs, (viii) restructuring costs or recovery, and (ix) loss on sale or disposal of equipment. See “Non-GAAP Financial Information” above for further information regarding the company’s use of non-GAAP financial measures. Free cash flow is a non-GAAP financial measure that reduces operating cash flows, the most directly comparable financial measure calculated in accordance with GAAP, by capital expenditures. See “Non-GAAP Financial Information” above for further information regarding the company’s use of non-GAAP financial measures.

Interested in Lifecore Biomedical, Inc.? Here are five stocks we like better. Lifecore reaffirmed its 2026 guidance for revenue of $120 million to $125 million and adjusted EBITDA of $20.5 million to $25 million, despite second-quarter revenue falling 6.2% year over year to $34.2 million and the net loss widening to $6.2 million. Contractually committed fill-finish demand from the company’s largest customer is expected to double beginning in 2027 and exceed 2026 levels by more than 200% in 2028. Lifecore also completed a Japanese regulatory inspection without material issues, potentially expanding market access. Lifecore added six development programs during the quarter and now has 11 programs that could commercialize by the end of 2028. Management expects stronger second-half results, supported by higher aseptic and development revenue, while targeting roughly $7 million to $10 million in full-year free cash flow. Lifecore Biomedical (NASDAQ:LFCR) reaffirmed its 2026 revenue and adjusted EBITDA guidance while outlining plans to support sharply higher fill-finish demand from its largest customer beginning in 2027. For the second quarter ended June 30, 2026, the contract development and manufacturing organization reported revenue of $34.2 million, down 6.2% from $36.4 million in the comparable prior-year quarter ended May 25, 2025. The company changed its fiscal year-end to align with the calendar year, affecting the comparison periods it used for the quarter and first half. → SpaceX’s First Earnings Report Could Decide Whether Shorts or Bulls Have Control President and Chief Executive Officer Paul Josephs said the company remains focused on three growth priorities: expanding its existing commercial business, moving development programs toward commercialization, and adding programs through business development. Josephs said Lifecore’s contractually committed fill-finish demand from its largest customer is expected to double beginning in 2027. Committed demand is expected to increase by more than 200% in 2028 compared with 2026. → 3 Drone Stocks That Should Soar After the Summer Slump The increase is expected to begin early in 2027 and be weighted more heavily toward the latter part of that year, according to management’s response to an analyst question. Lifecore also said it successfully completed an inspection by Japan’s Pharmaceuticals and Medical Devices Agency, or PMDA, a step that could open the Japanese market for the company’s hyaluronic acid and aseptic fill-finish products for that customer. The company hosted seven audits and inspections during the quarter, including five customer audits and two regulatory inspections, and said all were completed without material issues. → The Bitcoin Comeback May Already Be Underway—2 ETFs for Exposure Lifecore said it has 11 development programs that could potentially commercialize by the end of 2028. During the quarter, the company completed several process performance qualification batches for a customer approaching commercialization in 2027. Josephs cautioned that a PPQ campaign begins a one- to two-year process toward potential regulatory approval and recurring commercial revenue. The company added six new programs to its pipeline during the second quarter, including two expected to generate commercial revenue in the 2028-2029 timeframe. The agreements include programs with new and existing customers, spanning pre-clinical work through commercial transfers of two currently marketed products. Three of the six programs were signed in June. Since the end of the quarter, Lifecore also closed a late-stage injectable program with a specialty biopharmaceutical company. The company reported nine year-to-date new business wins through June 30 and 13 wins over the past 12 months. Josephs said more than 60% of opportunities that Lifecore has competed for since mid-2025 have been late-stage programs or commercial site transfers. He said these opportunities carry less market risk because they have already moved beyond clinical approval risk and have demonstrated commercial demand. Management cited increased FDA enforcement actions at other contract manufacturers, regionalization of U.S. drug manufacturing, and the prevalence of injectable products in drug development as favorable industry conditions. Josephs said Lifecore has won programs that are being transferred from Europe, Israel and India. Second-quarter gross profit fell to $12.1 million from $14 million a year earlier. The company attributed the decline primarily to lower revenue, unfavorable manufacturing costs and a contractual take-or-pay arrangement recognized in the prior-year period, partly offset by favorable hyaluronic acid sales volume. Selling, general and administrative expense declined 11.2% to $8 million, reflecting lower recurring legal, accounting and compensation costs as well as fewer non-recurring expenses tied primarily to legacy legal matters. Net loss was $6.2 million, or $0.19 per diluted share, compared with a net loss of $1.1 million, or $0.06 per diluted share, in the prior-year quarter. Adjusted EBITDA was $8.6 million, compared with $9.1 million a year earlier. Six-month revenue was $57.4 million, down 19.9% from $71.6 million in the comparable prior-year period. Six-month net loss was $21.1 million, or $0.61 per diluted share, compared with a $15.9 million loss, or $0.48 per diluted share, a year earlier. Six-month adjusted EBITDA was $9.6 million, down from $14.8 million. Chief Financial Officer Ryan Lake said the company expects stronger CDMO revenue in the second half, including higher aseptic and development revenue. He said results are expected to be more heavily weighted toward the fourth quarter based on timing of orders already in hand. Lifecore maintained its 2026 guidance for revenue of $120 million to $125 million and adjusted EBITDA of $20.5 million to $25 million. At the midpoint of those ranges, management indicated that second-half revenue would be about $65 million and adjusted EBITDA would be about $13 million. Lake said the second quarter marked Lifecore’s fifth consecutive quarter of period-over-period declines in SG&A and research and development expenses, with cumulative reductions of $16.2 million since its cost initiatives began in late 2024. The company is pursuing more than 40 projects intended to reduce costs or improve processes and productivity. Management said SG&A, excluding one-time items, is expected to trend toward approximately $6 million per quarter beginning sometime in the second half. Lifecore is targeting an adjusted EBITDA margin above 25% by the end of 2029. Josephs said existing installed capacity would support the company’s midterm targets, with projected utilization of roughly 60% in 2029. The company will evaluate additional capacity options, including its potential Site 3 expansion, as demand grows. Lifecore ended the quarter with approximately $38.8 million in liquidity, including $17.2 million of cash and $21.6 million of revolving credit availability. Lake said the company began paying a portion of its debt service in cash during the quarter rather than entirely through payment-in-kind interest. Management expects full-year free cash flow generation of roughly $7 million to $10 million, while noting that the outlook depends on legacy matters, capital-expenditure timing and potential payments related to Series A preferred securities. Lifecore Biomedical, Inc is a publicly traded specialty biopharmaceutical company headquartered in Chaska, Minnesota. The company focuses on the development, manufacture and commercialization of hyaluronic acid (HA)–based products that address medical and aesthetic needs. Lifecore’s proprietary HA formulations are designed to meet strict regulatory standards for purity, consistency and performance in highly regulated markets. The company’s product portfolio spans multiple therapeutic areas, including ophthalmology, orthopedics, dermatology and wound care. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Lifecore Biomedical Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

-- Reaffirms 2026 Guidance -- -- Signed Three New Commercial Site Transfer Programs in First Quarter 2026 -- -- Cost Containment Initiatives Continue to Drive Down Expenses -- Conference Call Today at 8:00am ET CHASKA, Minn., May 06, 2026 (GLOBE NEWSWIRE) -- Lifecore Biomedical, Inc. (NASDAQ: LFCR) (“Lifecore”), a fully integrated injectables contract development and manufacturing organization (“CDMO”), today announced results for the first quarter ended March 31, 2026. CEO Commentary “During the first quarter, Lifecore continued to successfully execute the three pillars of its growth strategy – maximizing our existing commercial business, advancing our development pipeline toward commercialization, and adding high-quality, new programs to our pipeline through business development. We believe our continued execution across these pillars positions Lifecore for sustained growth, including our goal of achieving a 12% revenue CAGR and EBITDA margins above 25% by the end of 2029. In the near-term, we remain confident in our full-year expectations and reaffirm our 2026 guidance. “Concurrently, we continue to optimize our organization through cost reductions, improved efficiencies, and elevated quality. I am energized by our achievements during the quarter and remain highly optimistic and committed to building on this momentum throughout the year,” stated Paul Josephs, President and Chief Executive Officer of Lifecore. Financial Snapshot and Recent Developments Revenues for the first quarter of 2026 were $23.2 million, a decrease of $12.0 million, or 34%, compared to $35.2 million for the comparable prior year quarter ended February 23, 2025. Gross profit margin for the first quarter of 2026 was 19%, 9% below 28% for the comparable prior year quarter ended February 23, 2025. Operating expenses for the first quarter of 2026 were $9.1 million, a decrease of $9.7 million, or 52%, compared to $18.9 million for the comparable prior year quarter ended February 23, 2025. Cash from operations was $4.7 million and free cash flow* was $3.6 million for the first quarter of 2026. Net loss for the first quarter of 2026 was $15.0 million and $0.43 of loss per diluted share, as compared to a net loss of $14.8 million and $0.42 of loss per diluted share, for the comparable prior year quarter ended February 23, 2025. Adjusted EBITDA* for the first quarter of 2026 was $1.0 million, a decrease of $4.7 million compared to $5.7 million for the comparable prior year quarter ended February 23, 2025. Ended the first quarter of 2026 with approximately $38.1 million in liquidity, including cash of $20.8 million and revolving credit availability of $17.3 million. Signed three new commercial site transfer programs in the first quarter of 2026, including two with an existing customer and one with leading medical aesthetics company. Implemented key initiatives throughout the organization that we expect will continue to drive margin improvement toward the goal of >25% in the mid-term. Successfully launched a new enterprise resource planning (“ERP”) system in January 2026, which we expect will strengthen inventory control, support financial management, and help reduce costs as the company grows. Completed multiple audits spanning new business prospects, existing customer expansions and international regulatory bodies. Each audit concluded positively, which we believe further validates Lifecore’s growing reputation as a partner-of-choice for customers seeking exceptional quality standards. Supplemental Financial Data To provide meaningful period-over-period comparisons, Lifecore has compared the first quarter ended March 31, 2026, to the comparable prior year quarter ended February 23, 2025. This presentation is intended to comply with Securities and Exchange Commission (“SEC”) requirements applicable to fiscal year changes and is intended to assist investors with understanding the changes in the company’s operating results and financial condition. Supplemental Revenue and Gross Profit Data Supplemental Operating Expense Data Financial Guidance for Calendar Year 2026 The company is reaffirming its revenue and Adjusted EBITDA guidance for calendar year 2026. The company is not providing forward-looking guidance for U.S. GAAP net loss or a quantitative reconciliation of its 2026 Adjusted EBITDA to the most directly comparable U.S. GAAP measure, U.S. GAAP net loss, because it is unable to predict with reasonable certainty the ultimate outcome of certain significant items, including restructuring expenses, reorganization expenses, asset impairments, litigation settlements and other contingencies, changes to the fair value of the debt derivative liability, certain other gains or losses, and income tax accounting, as certain of these items have not occurred, are out of the company's control and/or cannot be reasonably predicted without unreasonable effort. These items are uncertain, depend on various factors, and could have a material impact on U.S. GAAP reported results for the guidance period. The company expects revenue to be in the range of $120 to $125 million and Adjusted EBITDA to be in the range of $20.5 – $25 million. This guidance is based on the expectation that Lifecore would adjust for items similar to its historic definition of Adjusted EBITDA. This guidance takes into consideration existing market forces, contracts, and customer order timing, as well as the company’s current beliefs and estimations with respect to success and timing related to growing and diversifying the company’s new business development revenue. Please see “Non-GAAP Financial Information” below for more information. Earnings Webcast Lifecore Biomedical will host a conference call today, May 6, 2026, at 8:00 a.m. ET to discuss the company’s financial results for the first quarter ended March 31, 2026. The webcast can be accessed via Lifecore’s Investor Events & Presentations page at: https://ir.lifecore.com/events-presentations. An archived version of the webcast will be available on the website for 30 days. About Lifecore Biomedical Lifecore Biomedical, Inc. (Nasdaq: LFCR) is a fully integrated contract development and manufacturing organization (CDMO) that offers highly differentiated capabilities in the development, fill and finish of sterile injectable pharmaceutical products in syringes, vials, and cartridges, including complex formulations. As a leading manufacturer of premium, injectable-grade hyaluronic acid, Lifecore brings more than 40 years of expertise as a partner for global and emerging biopharmaceutical and biotechnology companies across multiple therapeutic categories to bring their innovations to market. For more information about the company, visit Lifecore’s website at www.lifecore.com. Non-GAAP Financial Information In addition to providing financial measurements based on generally accepted accounting principles in the United States of America (GAAP), this press release contains non-GAAP financial information. Adjusted EBITDA and free cash flow are non-GAAP measures and exclude certain items from net income or loss and operating cash flows, respectively, which are the most directly comparable financial measures calculated in accordance with GAAP. See the section entitled “Non-GAAP Financial Reconciliations” below for the company’s definitions of Adjusted EBITDA and free cash flows for the first quarter ended March 31, 2026, and the comparable prior year quarter ended February 23, 2025, and reconciliations thereof to net income or loss and operating cash flows for the relevant periods. The company has disclosed these non-GAAP financial measures to supplement its consolidated financial statements presented in accordance with GAAP. These non-GAAP financial measures exclude/include certain items that are included in the company’s results reported in accordance with GAAP because we believe they are not reflective of our core operations or indicative of our ongoing operations. Management believes these non-GAAP financial measures provide useful additional information to investors about trends in the company’s operations and are useful for period-over-period comparisons. Management uses Adjusted EBITDA and free cash flow, in addition to GAAP financial measures, to monitor trends in the company’s operations, understand and compare operating results, and monitor cash flows across accounting periods, for financial and operational decision making, for planning and forecasting purposes, and with respect to Adjusted EBITDA as a measure of performance for compensation decisions. These non-GAAP financial measures should not be considered in isolation or as a substitute for the comparable GAAP measures. In addition, these non-GAAP financial measures may not be the same as similar measures provided by other companies due to the potential differences in methods of calculation and items being excluded/included. These non-GAAP financial measures should be read in conjunction with the company’s consolidated financial statements presented in accordance with GAAP. Important Cautions Regarding Forward-Looking Statements This press release contains forward-looking statements regarding future events and our future results that are subject to the safe harbor created under the Private Securities Litigation Reform Act of 1995 and other safe harbors under the Securities Act of 1933 and the Securities Exchange Act of 1934. Words such as “anticipate”, “estimate”, “expect”, “project”, “aim,” “designed to,” “plan”, “intend”, “believe”, “may”, “might”, “will”, “should”, “can have”, “likely” and similar expressions are used to identify forward-looking statements. In addition, all statements regarding our future financial and operating performance and strategy, including the three pillars of our growth strategy; our positioning for sustained growth, including our goal of achieving a 12% revenue CAGR and EBITDA margins above 25% by the end of 2029; our confidence in our full-year expectations and reaffirming of 2026 guidance; our optimism and commitment to building on momentum throughout the year; key initiatives that are expected to continue to drive margin improvement; expected benefits of our new ERP system; and our growing reputation as a partner-of-choice for customers seeking exceptional quality standards, are forward-looking statements. All forward-looking statements involve certain risks and uncertainties that could cause actual results to differ materially, including such factors as, among others, the timing and amount of future expenses, revenue, net income (loss), Adjusted EBITDA, cash flow and capital requirements, and timing and availability of and the need for additional financing; our ability to maintain or expand our relationships with our current customers, including the impact of changes in consumer demand for the products we manufacture for our customers; our ability to grow and diversify our business with new customers, including the potential loss of development customers if they do not receive required funding or regulatory approvals or for other reasons; our ability to comply with covenants under our credit agreements and to pay required interest and principal payments when due; our ability to fund any redemptions of shares of the outstanding Series A Convertible Preferred Stock if requested by holders in accordance with their terms; our ability to raise additional capital for ongoing needs, including through equity financing, debt financing, collaborations, strategic alliances or licensing arrangements; the impact of macroeconomic events or circumstances on our operations and financial performance, including inflation, tariffs, interest rates, social unrest and global instability; the performance of our third-party suppliers; pharmaceutical industry market forces that may impact our customers’ success and continued demand for the products we produce for those customers; our ability to recruit or retain key scientific, technical, business development, and management personnel and our executive officers; our ability to comply with stringent U.S. and foreign government regulation in the manufacture of pharmaceutical products, including current Good Manufacturing Practice, or cGMP; the outcome and cost of existing and any new litigation or regulatory proceedings; and other risk factors set forth from time to time in the company’s filings with the Securities and Exchange Commission (the “SEC”), including, but not limited to, the Annual Report on Form 10-KT for the transition period ended December 31, 2025 (the “December 2025 10-KT”). For additional information about factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to our filings with the SEC, including the risk factors contained in the December 2025 10-KT. Forward-looking statements represent management’s current expectations as of the date hereof and are inherently uncertain. Except as required by law, we do not undertake any obligation to update forward-looking statements made by us to reflect subsequent events or circumstances. Lifecore Biomedical, Inc. Contact Information: Stephanie Diaz (Investors) Vida Strategic Partners 415-675-7401 [email protected] Jennifer Arcure (Media) Vida Strategic Partners 917-603-0681 [email protected] Ryan D. Lake (CFO) Lifecore Biomedical 952-368-6244 [email protected] Non-GAAP Financial Reconciliations Adjusted EBITDA is a non-GAAP financial measure and excludes certain items from net income or loss, the most directly comparable financial measure calculated in accordance with GAAP. For the periods presented herein, we defined Adjusted EBITDA as net income or loss before (i) interest expense, net of interest income, (ii) income tax expense or benefit, (iii) depreciation, (iv) stock-based compensation, (v) change in fair value of debt derivatives, (vi) franchise tax, (vii) reorganization costs, (viii) restructuring costs or recovery, and (ix) loss on sale or disposal of equipment. See “Non-GAAP Financial Information” above for further information regarding the company’s use of non-GAAP financial measures. Free cash flow is a non-GAAP financial measure that reduces operating cash flows, the most directly comparable financial measure calculated in accordance with GAAP, by capital expenditures. See “Non-GAAP Financial Information” above for further information regarding the company’s use of non-GAAP financial measures.

Management added three commercial site transfer programs in Q1 — including a U.S. aesthetics transfer and two CDMO agreements (one ophthalmic expansion) — and expects these to generate commercial revenue around 2028, each as mid‑seven‑figure opportunities. Q1 revenue fell 34% to $23.2M with a net loss of $15.0M and adjusted EBITDA of $1.0M, but the company cut SG&A/R&D (cumulative reductions ~$8M since late‑2024) and finished the quarter with about $38M in liquidity and positive operating cash flow. Management reaffirmed full‑year 2026 guidance (revenue $120–125M, adjusted EBITDA $20.5–25M) and reiterated long‑term targets of roughly a 12% revenue CAGR and >25% EBITDA margin by end of 2029. Interested in Lifecore Biomedical, Inc.? Here are five stocks we like better. Lifecore Biomedical (NASDAQ:LFCR) executives highlighted new commercial site transfer wins, continued cost reductions, and improving liquidity during the company’s first-quarter 2026 earnings call, while acknowledging a year-over-year revenue decline tied to previously discussed headwinds. President and CEO Paul Josephs said the company continued executing on “each of the three pillars” of its growth strategy: expanding existing commercial business, advancing development programs toward commercialization, and adding new programs through business development. Josephs said the company believes consistent execution supports its longer-term goal of a 12% revenue compound annual growth rate and EBITDA margins above 25% by the end of 2029. → 3 Emerging Markets ETFs to Maximize Exposure to High-Potential Countries Chief Financial Officer Ryan Lake reaffirmed full-year 2026 guidance, calling out the company’s expectations for: Total revenue: $120 million to $125 million Net loss: $35.4 million to $30.9 million Adjusted EBITDA: $20.5 million to $25 million Josephs emphasized business development momentum in early 2026, noting that Lifecore signed three new commercial site transfer programs in the first quarter. → The Real SpaceX Play: 5 Chip Stocks Powering the IPO Before It Launches In March, the company announced a manufacturing services agreement with a new aesthetics customer for the commercial site transfer of a marketed, approved product currently manufactured outside the U.S. Josephs said the customer’s goal is to establish U.S.-based manufacturing for products sold domestically, adding that Lifecore believes the product “may generate commercial revenue in 2028.” The company also signed two CDMO manufacturing services agreements with an existing U.S. biopharmaceutical customer. One agreement covers a commercial site transfer for a currently marketed product produced by another CDMO, with Lifecore performing technical transfer services to support regulatory approval at its site before commercial manufacturing begins. The second agreement expands an existing relationship for a commercial ophthalmic product Lifecore already manufactures in one delivery format; the company will now manufacture it in a second delivery system currently made in Europe. Josephs said the second delivery system is expected to be additive to existing commercial revenue for that product. → Tyson Foods' Total Returns: Tasty Treats for Income Investors? During the Q&A, management said the three commercial tech transfers are expected to generate commercial revenue in the 2028 timeframe, describing them as “mid 7-figure opportunities” for Lifecore. On development programs, Josephs highlighted an expanded relationship with Indomo, a clinical-stage therapeutics company. He said Lifecore signed a second agreement in January after previously being selected for formulation and process optimization work supporting Indomo’s DT-001 program. Under the new agreement, Lifecore will produce and supply clinical batches of DT-001 for studies intended to prepare the product to advance into Phase II clinical trials in 2026. Josephs said Lifecore’s late-stage development pipeline includes 13 late-stage programs, and that the three programs announced during the quarter were added to that group. He also said five late-stage programs are commercial site transfers, which he characterized as having existing market demand and being “significantly de-risked” compared with development programs because they do not require additional clinical trials and instead require qualification at Lifecore. Depending on regulatory timing, Josephs said the company expects these transfers to generate commercial revenue at Lifecore’s site in 2028. He also noted that two late-stage customers “nearing commercialization” achieved milestones: one ophthalmic customer announced positive top-line Phase III results, and another customer, after securing funding, has an “actionable path towards commercialization,” potentially in 2028. Josephs said Lifecore launched its enterprise resource planning system in January and described the implementation as smooth to date. He said the company expects the system to improve efficiencies across financial management, cost containment, productivity, and inventory control. He also said the company completed multiple inspections during the quarter with new prospects and existing customers, and that each inspection had a positive outcome. In response to an analyst question about customer traffic, Josephs said Lifecore has seen a “significant increase” in the number of audits from prospective customers, adding that the audit schedule was booked “into mid-June” for new customer audits. Asked about what is driving site transfers and pipeline activity, Josephs said reshoring is “meaningful” but “certainly not the majority,” estimating “maybe low double digits.” He also pointed to increased FDA enforcement activity in the industry, saying it has created opportunity for a provider with a strong quality track record. On fill-finish capacity dynamics, Josephs said demand continues to exceed available capacity for prefilled syringes and cartridges, while traditional vials have more capacity industrywide due to the drop in COVID-related demand. In another exchange, management said Lifecore is seeing most success in prefilled syringes, attributing the trend to healthcare moving more toward home-based treatment rather than hospital or clinic administration. For the first quarter ended March 31, 2026, Lake reported revenue of $23.2 million, down $12.0 million, or 34%, from $35.2 million in the comparable prior-year quarter ended Feb. 23, 2025. He said the decline was primarily due to factors described during the company’s fourth-quarter earnings announcement and stated the company remains on track to deliver full-year guidance. Gross profit was $4.5 million, down $5.4 million from $9.8 million a year earlier, which Lake attributed primarily to lower revenue. Selling, general and administrative expense was $7.9 million, down $2.1 million, or 21%, from $10.0 million in the prior-year comparable quarter. Lake said the decrease was driven by $1.6 million of lower recurring legal and accounting costs, lower compensation and lower credit losses, plus $0.5 million of lower non-recurring expenses primarily related to legacy legal matters. The company posted a net loss of $15.0 million, or $0.43 per diluted share, compared with a net loss of $14.8 million, or $0.42 per diluted share, a year earlier. Adjusted EBITDA was $1.0 million, down from $5.7 million in the comparable quarter, primarily due to lower revenue and partially offset by favorable operating expenses. Lake said the quarter marked the sixth consecutive quarter of period-over-period declines in SG&A and R&D expenses, and that since late 2024, cumulative reductions in SG&A and R&D were “almost $8 million,” including reductions in accounting, consulting, and legal expenses. Liquidity also improved, Lake said. Lifecore ended the quarter with approximately $38 million in overall liquidity, including about $21 million in cash and cash equivalents and about $17 million available under its revolver. He added that the quarter was the fifth consecutive quarter of positive cash flow from operations, and that Lifecore generated $4.7 million in cash from operations and $3.6 million of free cash flow in the quarter. In response to questions about the revenue cadence for the remainder of the year, Lake reiterated prior commentary that the company expects revenue to be in the “mid-40% range” in the first half of 2026 and in the “mid-50% range” in the second half, and said that split “hasn’t changed.” He also said the impacts from a customer supply chain initiative and a contract termination are front-loaded, with roughly 50% in the first quarter and about 80% expected to flow through the first half. Lifecore Biomedical, Inc is a publicly traded specialty biopharmaceutical company headquartered in Chaska, Minnesota. The company focuses on the development, manufacture and commercialization of hyaluronic acid (HA)–based products that address medical and aesthetic needs. Lifecore’s proprietary HA formulations are designed to meet strict regulatory standards for purity, consistency and performance in highly regulated markets. The company’s product portfolio spans multiple therapeutic areas, including ophthalmology, orthopedics, dermatology and wound care. The article "Lifecore Biomedical Q1 Earnings Call Highlights" was originally published by MarketBeat.