RMCF

Shares of Rocky Mountain Chocolate Factory, Inc. RMCF have lost 1.3% since the company reported its earnings for the quarter ended Aug. 31, 2026. This compares to the S&P 500 Index's 0.2% decline over the same time frame. Over the past month, the stock has gained 3.5% against the S&P 500's 0.9% loss. Rocky Mountain reported revenues of $6.7 million for the second quarter of fiscal 2027, compared with $6.8 million in the year-ago period. Net loss widened to $1.3 million, or 14 cents per share, from $0.7 million, or 9 cents per share, a year earlier. Product sales increased 2.5% to $5.3 million from $5.2 million. Manufacturing revenues from external customers declined 4.4% to $4.5 million from $4.8 million, while franchising revenues decreased 18.2% to $1.3 million from $1.6 million. Retail revenues increased 77.8% to $0.8 million from $0.4 million, benefiting from an expanded company-owned store base. Total product and retail gross profit improved to $0.4 million from a gross loss of less than $0.1 million in the prior-year quarter. Gross margin increased to 8% from (0.6)%, reflecting pricing actions and improved production efficiencies. Adjusted gross margin, a non-GAAP measure, increased to 12.3% from 4% a year earlier. However, EBITDA loss widened to $0.7 million from $0.1 million, indicating continued pressure on overall profitability. Total costs and expenses increased 5.9% to $7.7 million from $7.3 million. Higher franchise expenses, general and administrative costs, and expenses associated with additional company-owned stores contributed to the increase. Lower cost of sales and sales and marketing expenses provided partial offsets. Rocky Mountain Chocolate Factory, Inc. price-consensus-eps-surprise-chart | Rocky Mountain Chocolate Factory, Inc. Quote Manufacturing segment losses narrowed from the year-ago quarter, reflecting improved production efficiency and lower costs. However, franchising profitability declined amid lower royalty collections and higher operating expenses. The reduction in franchising revenues reflected fewer franchise locations and amendments to franchise agreements. Retail profitability improved, benefiting from the expansion of the company-operated store network. RMCF's total store count was 248 as of Aug. 31, 2026, compared with 253 as of Feb. 28, 2026. Domestic franchise stores and kiosks declined to 134 from 136, while Cold Stone Creamery co-branded locations decreased to 96 from 101. Rocky Mountain continued focusing on manufacturing efficiency, product availability and franchise operations. August marked the company's highest production and shipping month of calendar 2026. Management highlighted improvements to its enterprise resource planning and reporting systems, providing greater visibility into inventory, production requirements and customer demand. These initiatives are intended to improve manufacturing throughput, reduce operational inefficiencies and support franchisees. RMCF also completed a store traffic pilot across its corporate locations, allowing management to evaluate customer traffic, conversion rates and transaction values. Digital ordering, third-party delivery services and its Rocky Rewards loyalty program remain important components of its omnichannel strategy. As of Aug. 31, 2026, cash and cash equivalents totaled $0.4 million, compared with $1.2 million as of Feb. 28, 2026. Inventory declined to $2.6 million from $4.1 million over the same period. Outstanding debt totaled $6.9 million as of Aug. 31, 2026, compared with $6.6 million at fiscal 2026-end. RMCF reported noncompliance with certain debt covenants as of Aug. 31, 2026, alongside substantial doubt about its ability to continue as a going concern. Management remains focused on improving manufacturing productivity, strengthening franchise economics and maintaining product availability during the upcoming holiday season. Rocky Mountain intends to reduce overhead costs, optimize supply chain operations and improve inventory management. It also plans to expand e-commerce distribution and introduce refreshed holiday packaging and product assortments. Although management expressed confidence in its operational initiatives, it acknowledged that further improvements are necessary to restore sustainable growth and profitability. No specific financial guidance was provided. During July, Rocky Mountain acquired the Chino Hills, CA, franchise location, increasing its company-owned store count to five. The company also opened franchised stores in Folsom, CA, and Tinton Falls, NJ. The board established a strategic committee to evaluate financial and strategic alternatives, including a potential sale, merger, business combination or going-private transaction. Following quarter-end, RMCF completed a $6.6 million sale-leaseback of its Durango manufacturing facility, using the proceeds to repay existing debt. It also secured a $2 million working-capital loan from Alpine Bank, maturing in October 2028. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Rocky Mountain Chocolate Factory, Inc. (RMCF) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Release Date: October 19, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. - Total product and retail gross profit increased to $2.4 million from roughly breakeven last year, driving gross margin improvement to 8% from negative 0.6%. - August was the highest production and shipping month of the calendar year, indicating strong demand and operational progress. - The company completed a sale-leaseback of its Durango facility for approximately $6.6 million, using proceeds to repay high-interest debt (12% promissory notes). - A new $2 million loan agreement with Alpine Bank provides additional liquidity at a lower interest rate (prime plus 1%). - The company opened two new franchise stores and completed two remodels, while also acquiring a company-owned store to test operational improvements. - Management has organized operations around three strategic pillars (product/production/innovation, supply chain/logistics, and retail/omnichannel) to drive sustainable growth. - Investments in technology (ERP, POS, loyalty program, digital ordering) and brand modernization position the company for better guest engagement and operational efficiency. - Total revenue decreased slightly to $6.7 million from $6.8 million year-over-year, with product sales up only 2% due to lower Durango product sales and royalty fees. - Net loss widened to $1.3 million (negative $0.14 per share) from a net loss of $0.7 million (negative $0.09 per share) in the prior year period. - Cash position declined to $0.4 million from $1.2 million at the end of fiscal year 2026, indicating tight liquidity. - Total debt outstanding increased to $6.9 million from $6.6 million at fiscal year-end, and the company remains in a strategic review to address financial position. - Royalty and marketing fees declined due to fewer franchise stores and amendments to franchise agreements, reflecting challenges in the franchise network. - Total costs and expenses rose to $7.7 million from $7.3 million, driven by a larger company-owned store base and higher franchise and G&A costs. - The company recognizes it must deliver better results and is actively exploring strategic alternatives, including a possible sale or merger, highlighting ongoing financial uncertainty. - Warning! GuruFocus has detected 8 Warning Signs with RMCF. - Is RMCF fairly valued? Test your thesis with our free DCF calculator. Q: What strategic alternatives is Rocky Mountain Chocolate Factory considering, and what has the Board done to oversee this process? A: Interim CEO Allen Harper stated that during the quarter the Board formed a strategic committee to oversee a review of strategic and financial alternatives intended to strengthen the company's financial position and maximize long-term shareholder value. Options under consideration include financing, a possible sale, merger, or other business combination, or an ongoing private transaction. He noted the strategic review continues while management remains focused on improving the business it operates today. Q: How did the sale-leaseback of the Durango facility and the new loan agreement affect the company's debt position? A: CFO Carrie Cass said that following quarter end, the company signed an agreement for the sale-leaseback of its Durango facility for approximately $6.6 million, with proceeds used to repay existing $6.6 million promissory notes that carried a 12% interest rate. On October 1, 2026, the company entered into a lease for continued use of the facility, with first-year rent of $624,000, equal to 9.45% of the purchase price. On October 16, 2026, it also entered into a $2 million loan agreement with Alpine Bank that matures in October 2028 and bears interest at prime plus 1%. Q: What drove the improvement in gross margin in the fiscal second quarter? A: CFO Carrie Cass reported that total product and retail gross profit increased $2.4 million compared to roughly breakeven in the same period last year, driving gross margin up to 8% from negative 0.6% a year earlier. Total revenue was $6.7 million versus $6.8 million last year, while product sales rose 2% to $5.3 million, with higher retail sales from the larger company-owned store base and price increases more than offset by lower Durango product sales and royalty and marketing fees. Q: What were the key financial results and balance sheet metrics for the quarter? A: CFO Carrie Cass said total costs and expenses were $7.7 million compared to $7.3 million last year, reflecting the larger company-owned store base and higher franchise and general administrative costs, partially offset by lower cost of sales and sales and marketing expenses. Net loss was $1.3 million, or negative $0.14 per share, compared to a net loss of $0.7 million, or negative $0.09 per share, last year. The company ended the quarter with cash of $0.4 million, inventory of $2.6 million, and total debt outstanding of $6.9 million as of August 31, 2026. Q: What are the three strategic operating pillars management is focused on? A: COO David Denker outlined three strategic pillars: product, production and innovation; supply chain and logistics; and retail experience and omnichannel growth. Across each pillar, the approach is to simplify the business, improve visibility and accountability, and scale what works, with the goal of improving product availability, strengthening franchise economics, and delivering a better guest experience. Q: How is the company improving factory production and throughput? A: COO David Denker said demand for product remained strong, with August being the highest production and shipping month of the calendar year. The company is managing operations around equipment uptime, throughput, yield and scrap, product availability, and order fulfillment, while tightening the operating cadence for demand planning through finished goods, including production scheduling, material readiness, and equipment reliability. The goal is to identify constraints early and solve them before they become missed production or missed customer orders. Q: How is the company using company-owned stores and data to improve retail performance? A: COO David Denker said the company acquired the Chino Hills store during the quarter, increasing company-owned stores to five locations from three a year ago. These stores serve as operating laboratories to test merchandising, labor models, product presentation, training, technology, and new guest experiences. The company also completed a store traffic pilot at corporate locations, using POS data to gain a more complete view of store performance including traffic, conversion, average transaction value, items per transaction, product mix, sales, and profitability. Q: What progress was made on the franchise system during the quarter? A: COO David Denker reported that the company opened new franchise stores in Folsom, California and Tinton Falls, New Jersey, completed two remodels, and continued onboarding franchisees to its integrated ordering platform and third-party delivery channels. He emphasized that a healthier franchise system is fundamental to the long-term health of Rocky Mountain Chocolate Factory, and that improving product availability, simplifying operations, strengthening merchandising, and providing better training and data should make the system easier and more productive to operate. Q: What is the company's plan for product assortment and innovation? A: COO David Denker said enhancements to the reporting platform alongside the ERP are giving better visibility into demand, inventory, and production requirements. The company is improving production planning and selectively using qualified third-party products where they complement capabilities and improve availability. Simplification means a more focused assortment and a more deliberate innovation calendar balancing core products with seasonal items, limited-time offerings, and gifting occasions, which should help use the factory more efficiently, keep more product in stock, and improve product mix and margin over time. Q: What is management's near-term priority and outlook? A: Interim CEO Allen Harper said the second quarter showed that better coordination and execution can improve production and gross margin, but the business must deliver better results, and near-term focus remains on disciplined execution. Priorities are to execute through the holiday season, support franchisees and stores, manage the financial position carefully, and evaluate credible strategic alternatives. CFO Carrie Cass added that the organization is aligned on executing with excellence through the holiday season by keeping standard products flowing, supporting franchisees, and delivering a consistent premium guest experience. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Management to Host Conference Call Monday at 5:00 p.m. ET DURANGO, Colo., Oct. 19, 2026 (GLOBE NEWSWIRE) -- Rocky Mountain Chocolate Factory, Inc. (Nasdaq: RMCF) (the "Company" or "RMCF"), America's Chocolatier® since 1981, is reporting financial and operating results for its second quarter of fiscal 2027, which ended August 31, 2026. "Since stepping into the Interim CEO role, I have been encouraged by the way our leadership team has come together around a shared set of priorities for the business," said Allen Harper, Interim CEO. "With COO David Denker leading our day-to-day operations, our teams are increasingly aligned across the business. That alignment is strengthening accountability and decision-making as we build a stronger organization and position Rocky Mountain Chocolate Factory for sustainable growth and long-term shareholder value." David Denker, Chief Operating Officer, added, "During the second quarter, we made progress improving production and execution across the business. August was our highest production and shipping month of the calendar year. Increasing production volume from our Durango facility remains a key priority as we prepare for the holiday season. Enhancements to our reporting platform, combined with our ERP capabilities, are providing our teams with greater visibility into demand, inventory and production requirements. These operational improvements, together with our continued focus on production efficiency and execution, contributed to the recovery in gross margin during the quarter. We believe there is additional opportunity to build on this progress as we move through the holiday season." Mr. Denker continued, "The acquisition of Chino Hills in July 2026 expanded our company-owned store base to five locations, while new franchised stores opened in Folsom, California, and Tinton Falls, New Jersey. As we grow our footprint and continue to enhance operations, we remain focused on consistent execution, supporting our franchisees and preserving the product quality and longstanding recipes that distinguish Rocky Mountain Chocolate Factory." Fiscal Second Quarter 2027 Financial Results vs. Fiscal Second Quarter 2026 - Total revenue was $6.7 million for the second quarter of fiscal 2027 compared to $6.8 million in the second quarter of fiscal 2026. Primarily due to lower Durango product sales and royalty and marketing fees which offset the increase in retail sales, driven by the larger company-owned store base and price increases. - Total product and retail gross profit increased to $0.4 million in the second quarter of fiscal 2027 compared to a gross loss of less than $0.1 million in the second quarter of fiscal 2026. Gross margin improved to 8.0% from (0.6)%, reflecting pricing actions and production efficiencies. - Total costs and expenses were $7.7 million in the second quarter of fiscal 2027, up from $7.3 million in the second quarter of fiscal 2026. The increase primarily reflects the larger company-owned store base and higher franchise and general and administrative costs. These increases were partially offset by lower cost of sales and sales and marketing expenses. - Net loss was $1.3 million or $(0.14) per share for the second quarter of fiscal 2027, compared to a net loss of $0.7 million or $(0.09) per share in the second quarter of fiscal 2026. - EBITDA loss was $0.7 million in the second quarter of fiscal 2027 compared to a loss of $0.1 million in the second quarter of fiscal 2026. In the fiscal second quarter, the Board formed a strategic committee, which with the assistance of its advisors, is exploring strategic alternatives that may be available to the Company. Alternatives may include, among other things, a possible sale, merger, or other business combination, or a going-private transaction. In connection with this process, the Company has received expressions of interest from third parties. There can be no assurance that this review of strategic alternatives will result in any transaction or other strategic change. Subsequent Events Subsequent to quarter end, the Company completed a $6.6 million sale-leaseback transaction with American Heritage Legacies, LLC for its manufacturing facility located in Durango, Colorado. The sale was completed and the lease commenced on October 16, 2026. Net proceeds from the sale of the property have been used to repay $6.6 million in debt, which bears interest at 12% per annum. In connection with the repayment, the Company incurred prepayment penalties and related costs of $0.3 million. On October 16, 2026, the Company entered into a loan agreement with Alpine Bank, where the Company received an advance of $2.0 million for working capital purposes. The loan matures on October 16, 2028, and bears interest at the prime rate plus 1%. Additional information is included in the Company's Quarterly Report on Form 10-Q for the quarter ended August 31, 2026. Conference Call Information The Company will conduct a conference call to discuss its financial results. There will be no question-and-answer session. The conference call details are as follows: Date: Monday, October 19, 2026 Time: 5:00 p.m. Eastern time Dial-in registration link: here Live webcast registration link: here Please dial into the conference call 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact the Company's investor relations team at [email protected]. The conference call will also be broadcast live and available for replay in the investor relations section of the Company's website at https://ir.rmcf.com/. About Rocky Mountain Chocolate Factory, Inc. Rocky Mountain Chocolate Factory, Inc. is a leading franchisor, manufacturer and retailer of premium chocolates and other confectionery products. As America's Chocolatier® since 1981, the Company produces an extensive assortment of premium chocolates, gourmet caramel apples and other handcrafted confections. Headquartered in Durango, Colorado, Rocky Mountain Chocolate Factory is ranked among Entrepreneur's Franchise 500® for 2026. Together with its franchisees and licensees, the Company operates approximately 250 Rocky Mountain Chocolate Factory locations across the United States and internationally. The Company's common stock is listed on the Nasdaq Capital Market under the symbol "RMCF." Forward-Looking Statements This press release includes statements of our expectations, intentions, plans and beliefs that constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to come within the safe harbor protection provided by those sections. These forward-looking statements involve various risks and uncertainties. The statements, other than statements of historical fact, included in this press release are forward-looking statements. Many of the forward-looking statements contained in this document may be identified by the use of forward-looking words such as "will," "intend," "believe," "expect," "anticipate," "should," "plan," "estimate," "potential," or similar expressions. However, the absence of these words or similar expressions does not mean that a statement is not forward-looking. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future - including statements regarding future financial and operating results and anticipated outcomes of our business strategy and plan, our liquidity and ability to continue as a going concern, our strategic review and any resulting transaction, the anticipated benefits of the sale-leaseback of our Durango facility and our credit facility with Alpine Bank, our efforts to improve production, fulfillment and distribution and pursuit of higher-margin product opportunities are forward-looking statements. Management of the Company believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any such forward-looking statements because such statements speak only as of the date of this press release. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause our Company's actual results to differ materially from historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to: inflationary impacts, changes in the confectionery business environment, seasonality, consumer interest in our products, receptiveness of our products internationally, consumer and retail trends, costs and availability of raw materials, competition, the success of our co-branding strategy, the success of international expansion efforts and the effect of government regulations. For a detailed discussion of the risks and uncertainties that may cause our actual results to differ from the forward-looking statements contained herein, please see the section entitled "Risk Factors" contained in our periodic reports, each filed with the Securities and Exchange Commission. Investor Contact Sean Mansouri, CFA Elevate IR (720) 330-2829 [email protected] Media Contact Raymond Barrett Director of Marketing (305) 801-5641 [email protected] Rocky Mountain Chocolate Factory, Inc. and Subsidiaries Condensed Consolidated Statements of Operations (In thousands, except share and per share amounts) (Unaudited) | | | | | | | | Three Months Ended | | Six Months Ended | August 31, | | August 31, | 2026 | | 2025 | | 2026 | | 2025 Revenues | | | | | | | Sales | $ | 5,310 | | | $ | 5,183 | | | $ | 10,191 | | | $ | 9,900 | Franchise and royalty fees | | 1,342 | | | | 1,640 | | | | 2,574 | | | | 3,296 | Total revenue | | 6,652 | | | | 6,823 | | | | 12,765 | | | | 13,196 | | | | | | | | Costs and Expenses | | | | | | | Cost of sales | | 4,887 | | | | 5,216 | | | | 9,589 | | | | 9,608 | Franchise costs | | 784 | | | | 552 | | | | 1,275 | | | | 1,147 | Sales and marketing | | 162 | | | | 223 | | | | 352 | | | | 429 | General and administrative | | 1,328 | | | | 976 | | | | 2,608 | | | | 1,977 | Retail operating | | 435 | | | | 227 | | | | 752 | | | | 433 | Depreciation and amortization, exclusive of depreciation and amortization expense of $232, $238, $459 and $465, respectively, included in cost of sales | | 141 | | | | 108 | | | | 280 | | | | 226 | Total costs and expenses | | 7,737 | | | | 7,302 | | | | 14,856 | | | | 13,820 | | | | | | | | Loss from Operations | | (1,085 | ) | | | (479 | ) | | | (2,091 | ) | | | (624 | ) | | | | | | | Other Income (Expense) | | | | | | | Interest expense | | (211 | ) | | | (190 | ) | | | (419 | ) | | | (378 | ) Interest income | | 15 | | | | 7 | | | | 61 | | | | 16 | Other (expense) income, net | | (196 | ) | | | (183 | ) | | | (358 | ) | | | (362 | ) | | | | | | | Loss Before Income Taxes | | (1,281 | ) | | | (662 | ) | | | (2,449 | ) | | | (986 | ) | | | | | | | Income Tax Provision (Benefit) | | - | | | | - | | | | - | | | | - | | | | | | | | Net Loss | $ | (1,281 | ) | | $ | (662 | ) | | $ | (2,449 | ) | | $ | (986 | ) | | | | | | | Basic Loss per Common Share | $ | (0.14 | ) | | $ | (0.09 | ) | | $ | (0.26 | ) | | $ | (0.13 | ) | | | | | | | Diluted Loss per Common Share | $ | (0.14 | ) | | $ | (0.09 | ) | | $ | (0.26 | ) | | $ | (0.13 | ) | | | | | | | Weighted Average Common Shares Outstanding - Basic | | 9,447,259 | | | | 7,786,384 | | | | 9,418,824 | | | | 7,764,351 | Dilutive Effect of Employee Stock Awards | | - | | | | - | | | | - | | | | - | Weighted Average Common Shares Outstanding - Diluted | | 9,447,259 | | | | 7,786,384 | | | | 9,418,824 | | | | 7,764,351 | | | | | | | | | | | | | | | | Rocky Mountain Chocolate Factory, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (In thousands, except share and per share amounts) | | | | August 31, 2026 (unaudited) | | February 28, 2026 Assets | | | Current Assets | | | Cash and cash equivalents | $ | 416 | | | $ | 1,218 | Accounts receivable, less allowance for credit losses of $128 and $128, respectively | | 2,951 | | | | 2,545 | Notes receivable, current portion, less current portion of the allowance for credit losses of $28 and $28, respectively | | 63 | | | | 59 | Refundable income taxes | | 56 | | | | 58 | Inventories | | 2,588 | | | | 4,057 | Prepaid expenses | | 1,003 | | | | 831 | Total current assets | | 7,077 | | | | 8,768 | Property and Equipment, Net | | 8,724 | | | | 8,775 | Other Assets | | | Notes receivable | | 6 | | | | 36 | Goodwill | | 576 | | | | 576 | Intangible assets, net | | 691 | | | | 733 | Lease right of use asset | | 1,706 | | | | 1,310 | Other | | 14 | | | | 14 | Total other assets | | 2,993 | | | | 2,669 | Total Assets | $ | 18,794 | | | $ | 20,212 | Liabilities and Stockholders' Equity | | | Current Liabilities | | | Accounts payable | $ | 4,922 | | | $ | 5,088 | Accrued salaries and wages | | 441 | | | | 406 | Notes payable | | 6,780 | | | | - | Gift card liabilities | | 654 | | | | 654 | Other accrued expenses | | 286 | | | | 64 | Contract liabilities | | 106 | | | | 105 | Lease liability | | 416 | | | | 282 | Total current liabilities | | 13,605 | | | | 6,599 | Notes payable, less current portion | | 114 | | | | 6,568 | Lease liability, less current portion | | 1,324 | | | | 1,054 | Contract liabilities, less current portion | | 538 | | | | 575 | Deferred income taxes | | 187 | | | | 187 | Total Liabilities | | 15,768 | | | | 14,983 | Commitments and Contingencies | | | Stockholders' Equity | | | Preferred stock, $0.001 par value per share; 250,000 shares authorized; 0 shares issued and outstanding | | - | | | | - | Common stock, $0.001 par value, 46,000,000 shares authorized, 9,518,636 shares and 9,354,620 shares issued and outstanding, respectively | | 10 | | | | 9 | Additional paid-in capital | | 15,413 | | | | 15,168 | Accumulated deficit | | (12,397 | ) | | | (9,948 | ) Total stockholders' equity | | 3,026 | | | | 5,229 | Total Liabilities and Stockholders' Equity | $ | 18,794 | | | $ | 20,212 | | | | Rocky Mountain Chocolate Factory, Inc. and Subsidiaries Condensed Consolidated Computation of Adjusted Gross Margin (In Thousands) (Unaudited) | | | | | | | | Three Months Ended August 31, | | Six Months Ended August 31, | 2026 | | 2025 | | 2026 | | 2025 Total gross margin | $ | 423 | | | $ | (33 | ) | | $ | 602 | | | $ | 292 | Plus: depreciation and amortization | | 232 | | | | 238 | | | | 459 | | | | 465 | Total Adjusted Gross Margin (non-GAAP measure) | $ | 655 | | | $ | 205 | | | $ | 1,061 | | | $ | 757 | | | | | | | | Total Adjusted Gross Margin (non-GAAP measure) | | 12.3 | % | | | 4.0 | % | | | 20.0 | % | | | 14.6 | % | | | | | | | Rocky Mountain Chocolate Factory, Inc. and Subsidiaries Condensed Consolidated Computation of EBITDA (In Thousands) (Unaudited) | Three Months Ended August 31, | | Six Months Ended August 31, | 2026 | | 2025 | | 2026 | | 2025 Net loss | $ | (1,281 | ) | | $ | (662 | ) | | $ | (2,449 | ) | | $ | (986 | ) Plus: depreciation and amortization | | 373 | | | | 346 | | | | 739 | | | | 691 | Plus: interest | | 196 | | | | 183 | | | | 358 | | | | 362 | | | | | | | | Total EBITDA loss | $ | (712 | ) | | $ | (133 | ) | | $ | (1,352 | ) | | $ | 67 | | | | | | | | Non-GAAP Financial Measures This press release includes non-GAAP financial measures, EBITDA loss and Adjusted Gross Margin. The Company defines EBITDA loss as net earnings before interest, taxes on income, and depreciation and amortization. The Company defines Adjusted Gross Margin as gross margin plus depreciation and amortization included in the cost of sales. Reconciliations of EBITDA loss and Adjusted Gross Margin with their most directly comparable GAAP measure is included in this press release. These are supplemental measures of performance that are not required by, or presented in accordance with, GAAP. The Company believes Adjusted Gross Margin is useful to investors, as a supplement to gross margin and other performance measures calculated in accordance with GAAP, because it provides a measure of operating performance that is unaffected by non-cash depreciation and amortization. Management also uses Adjusted Gross Margin, rather than gross margin, to make incremental pricing decisions. The Company believes EBITDA (loss) is useful to investors because it helps them evaluate the Company's core operating performance without the effects of financing decisions, income taxes and non-cash depreciation and amortization, and management uses EBITDA (loss) to evaluate the Company's operating performance from period to period. EBITDA (loss) and Adjusted Gross Margin have limitations as analytical tools because they exclude the impact of depreciation and amortization expense and, in the case of EBITDA (loss), interest and income taxes. They should not be considered in isolation or as a substitute for any measure reported under GAAP. The Company's use of capital assets makes depreciation and amortization expense a necessary element of its costs and its ability to generate income. Because of these limitations, the Company uses EBITDA (loss) and Adjusted Gross Margin only in conjunction with GAAP measures of performance, such as net loss and gross margin. In addition, other companies may calculate similarly titled measures differently, so the Company's non-GAAP financial measures may not be comparable to those of other companies.

DURANGO, Colo., July 14, 2026 (GLOBE NEWSWIRE) -- Rocky Mountain Chocolate Factory, Inc. (Nasdaq: RMCF) (the “Company” or “RMCF”), America’s Chocolatier® since 1981, is reporting financial and operating results for its first quarter fiscal 2027, which ended May 31, 2026. “Since stepping into the Interim CEO role, I have been encouraged by the commitment of our team, the engagement of our franchisees and the support of our Board,” said Allen Harper, Interim CEO. “I want to thank Jeff for his leadership and recognize the work he, Carrie and the broader team have done to strengthen the foundation of the business, including the important progress made across pricing, production efficiency, ERP and store-level systems, franchisee ordering capabilities and customer engagement. While our first quarter results reflect continued near-term challenges, I believe we are entering a phase where execution, alignment and accountability will be critical." “Working closely with the Board and leadership team, our immediate focus is on improving production, strengthening fulfillment and distribution, pursuing higher-margin product opportunities and evaluating ways to address the Company’s debt structure and working capital at favorable terms. These priorities will guide us in the coming quarters as we focus on product quality, service and franchisee support to better position Rocky Mountain Chocolate Factory for sustainable growth. Most importantly, we want our employees, franchisees and customers to feel renewed energy around this brand. We are working hard to ultimately make chocolate fun again.” Mel Keating, chairman of the Board, added, “Al brings decades of leadership experience in consumer-facing businesses and a deep connection to the city of Durango, its people and this Company through his service on the Board and as one of the Company’s largest shareholders. His familiarity with our business, franchise network and strategic priorities allows him to lead from day one as the Company remains focused on disciplined execution and long-term value creation for shareholders.” Fiscal First Quarter 2027 Financial Results vs. Fiscal First Quarter 2026 Total revenue was $6.1 million for the first quarter of fiscal 2027 compared to $6.4 million in the first quarter of fiscal 2026. A 3% increase in Durango product and retail sales from price increases was offset by lower royalty and marketing fees under revised franchise agreements. Total product and retail gross profit was $0.2 million in the first quarter of fiscal 2027 compared to $0.3 million in the first quarter of fiscal 2026, reflecting lower packaged product sales. Total costs and expenses were $7.1 million in the first quarter of fiscal 2027, up from $6.5 million in the first quarter of fiscal 2026. The increase was driven by higher cost of sales, higher general and administrative costs tied to the franchise website and third-party delivery platform rollout, and higher retail operating costs with the increase from two to four company-owned stores, partially offset by lower franchise and sales and marketing costs. Net loss was $1.2 million or $(0.12) per share for the first quarter of fiscal 2027, compared to a net loss of $0.3 million or $(0.04) per share in the first quarter of fiscal 2026. EBITDA was $(0.6) million in the first quarter of fiscal 2027 compared to $0.2 million in the first quarter of fiscal 2026. The Company will not host a conference call in connection with this earnings release. The Company currently expects to host a conference call in connection with its fiscal second quarter 2027 results. About Rocky Mountain Chocolate Factory, Inc. Rocky Mountain Chocolate Factory, Inc. is a leading franchisor of premium chocolate and confectionary retail store concept. As America’s Chocolatier®, the Company has been producing an extensive line of premium chocolates and other confectionery products, including gourmet caramel apples since 1981. Headquartered in Durango, Colorado, Rocky Mountain Chocolate Factory is ranked among Entrepreneur’s Franchise 500® for 2026. The Company and its franchisees and licensees operate approximately 250 Rocky Mountain Chocolate stores across the United States, with several international locations. The Company's common stock is listed on the Nasdaq Capital Market under the symbol "RMCF." Forward-Looking Statements This press release includes statements of our expectations, intentions, plans and beliefs that constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to come within the safe harbor protection provided by those sections. These forward-looking statements involve various risks and uncertainties. The statements, other than statements of historical fact, included in this press release are forward-looking statements. Many of the forward-looking statements contained in this document may be identified by the use of forward-looking words such as "will," "intend," "believe," "expect," "anticipate," "should," "plan," "estimate," "potential," or similar expressions. However, the absence of these words or similar expressions does not mean that a statement is not forward-looking. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future - including statements regarding future financial and operating results and anticipated outcomes of our business strategy and plan, our expectations regarding hosting conference calls, our efforts to improve production, fulfillment and distribution and pursuit of higher-margin product opportunities are forward-looking statements. Management of the Company believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any such forward-looking statements because such statements speak only as of the date of this press release. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause our Company’s actual results to differ materially from historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to: inflationary impacts, changes in the confectionery business environment, seasonality, consumer interest in our products, receptiveness of our products internationally, consumer and retail trends, costs and availability of raw materials, competition, the success of our co-branding strategy, the success of international expansion efforts and the effect of government regulations. For a detailed discussion of the risks and uncertainties that may cause our actual results to differ from the forward-looking statements contained herein, please see the section entitled “Risk Factors” contained in our periodic reports, each filed with the Securities and Exchange Commission. Investor Contact Sean Mansouri, CFAElevate IR(720) [email protected] Media Contact Raymond BarrettDirector of Marketing(305) [email protected] GAAP to Non-GAAP Financial Measures This press release includes a non-GAAP financial measure, EBITDA, which the Company defines as net earnings before interest expense, taxes on income, and depreciation and amortization. A reconciliation of EBITDA with GAAP net earnings attributable to the Company is included in this press release.

Shares of Rocky Mountain Chocolate Factory, Inc. RMCF have lost 12.7% since the company reported earnings for the quarter ended Feb. 28, 2026, underperforming the S&P 500 Index, which fell 0.2% over the same period. The stock’s recent weakness extends to a broader timeframe, with shares plunging 35.3% over the past month against a 2.3% gain for the S&P 500. Rocky Mountain reported fourth-quarter fiscal 2026 revenues of $6.8 million, down 24.1% from $8.9 million in the year-ago quarter. Product sales declined 27.8% to $5.1 million, while franchise and royalty fees slipped 9.5% to $1.6 million. Net loss widened to $3.4 million, or 38 cents per share, from $2.9 million, or 37 cents per share, a year earlier. Product and retail gross profit remained negative at $0.9 million compared with $0.8 million in the prior-year quarter. EBITDA was a loss of $2.6 million in the quarter compared with $2.5 million in the year-ago period, reflecting weaker sales and the impact of deferred tax liabilities. For the full fiscal year, Rocky Mountain reported revenues of $27.5 million, down 7% from $29.6 million in fiscal 2025. Product sales declined 11% to $21.4 million, reflecting weaker sales through packaged products and Specialty Markets channels, while franchise and royalty fee revenue increased 10.3% to $6.1 million. Despite lower revenues, total product and retail gross profit improved significantly to $0.7 million from $0.1 million in the prior year, aided by pricing actions, product mix improvements and operational efficiencies. Total costs and expenses decreased 12.5% to $31.1 million from $35.5 million. As a result, net loss from continuing operations narrowed to $4.6 million, or 56 cents per share, from a loss of $6.1 million, or 86 cents per share, in fiscal 2025. EBITDA improved to a loss of $2.1 million from $4.7 million a year earlier. Management attributed the quarter’s disappointing performance primarily to an unsuccessful packaged product assortment strategy. According to Interim CEO Jeff Geygan, RMCF emphasized larger boxed assortments and larger candy pieces that did not align with customer preferences, resulting in packaged product sales running approximately $1.5 million below expectations. The sales shortfall had an outsized effect on profitability because packaged products carry Rocky Mountain’s highest margins. The quarter was also affected by Rocky Mountain’s decision to exit a specialty markets customer relationship tied to a low- or negative-margin offering, reducing revenue by nearly $1.5 million. Additional headwinds included temporary disruptions associated with an e-commerce transition, disposal costs related to outdated packaging materials and elevated professional service expenses. Despite lower sales, total costs and expenses declined 15.5% year over year to $9.8 million from $11.6 million, primarily due to efficiencies gained from relocating consumer packaging operations back to the Durango, CO, production facility. Rocky Mountain Chocolate Factory, Inc. price-consensus-eps-surprise-chart | Rocky Mountain Chocolate Factory, Inc. Quote Management emphasized that underlying operational initiatives continue to generate benefits. Rocky Mountain said pricing actions, product mix improvements, SKU rationalization and production process enhancements helped it achieve its strongest gross-margin product mix in more than two years and move closer to its long-term gross-margin target. RMCF also highlighted positive trends in remodeled and newly designed stores. Its Chicago State Street location is generating approximately $1.1 million in annualized sales, while the Charleston, SC, store is operating at an annualized revenue run rate of roughly $600,000. A remodeled company-owned store in Corpus Christi, TX, has posted a 10% to 15% sales increase since reopening. Rocky Mountain continues to expand operational capabilities across its franchise system. The rollout of an upgraded point-of-sale platform is providing improved visibility into basket size, transaction counts and customer purchasing behavior. The company is also seeing encouraging results from third-party delivery platforms, where average basket sizes are roughly double in-store transaction values. Rocky Mountain ended fiscal 2026 with cash and cash equivalents of $1.2 million, up from $0.7 million at the end of fiscal 2025. Inventory declined to $4.1 million from $4.6 million, while total debt stood at $6.6 million as of Feb. 28, 2026. Management said consumer research involving more than 1,000 participants helped identify shortcomings in the packaged assortment strategy. Based on the findings, Rocky Mountain plans to introduce redesigned packaged offerings by Labor Day, including a wider variety of products and smaller-format assortments. The company expects the new packaging design to lower production and packaging costs while improving competitive pricing and sales volume. RMCF is also developing a new loyalty and mobile application expected to launch in late summer and preparing a promotional collaboration with the Miraculous animated franchise scheduled for Sept. 15 through Oct. 31. Management did not provide formal fiscal 2027 guidance. RMCF said it remains focused on improving execution in packaged products and e-commerce, building on recent margin gains and translating operational improvements into sustainable revenue growth and profitability. During the quarter, Rocky Mountain acquired a franchise store in Nashville, TN, expanding its portfolio of company-owned locations. Management said company-store acquisitions are generally accretive to earnings and provide valuable testing grounds for merchandising, product launches and guest-engagement initiatives. RMCF also continued franchise expansion efforts, adding a new six-store area development agreement and increasing committed future development to 40 locations over the next three to five years. Of those planned locations, management noted that 31 are tied to existing franchisees and nine involve a new operator. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Rocky Mountain Chocolate Factory, Inc. (RMCF) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Release Date: June 02, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Rocky Mountain Chocolate Factory Inc (NASDAQ:RMCF) has conducted extensive consumer research to better align its product offerings with customer preferences, which is expected to improve future sales. The company has achieved the highest gross margin mix in over two years, indicating improved profitability. RMCF is seeing encouraging performance trends in newly designed and remodeled stores, such as the Chicago State Street and Charleston locations. The company is expanding its franchise development with 40 area development agreements, indicating growth potential. RMCF has negotiated corporate shipping rates to improve e-commerce cost structure, enhancing online sales profitability. The fiscal fourth quarter results fell short of expectations due to a misalignment in packaged product assortment, impacting revenue and profitability. The company experienced temporary disruptions related to e-commerce transition and incurred costs from outdated packaging disposal. RMCF exited a negative margin specialty markets customer relationship, impacting revenue by nearly $1.5 million. Total revenue for the fourth fiscal quarter decreased to $6.8 million from $8.9 million in the same period last year. The company reported a net loss of $3.4 million or 38 cents per share, compared to a net loss of $2.9 million or 37 cents per share in the same period last year. Warning! GuruFocus has detected 9 Warning Signs with RMCF. Is RMCF fairly valued? Test your thesis with our free DCF calculator. Q: How did Rocky Mountain Chocolate Factory determine the original product assortment that led to the disappointing quarter? A: Interim CEO Jeff Geagan explained that the original assortment was based on store-level sales data, which indicated that large-sized pieces and truffles were popular. However, this did not align with consumer preferences for packaged products. Q: Will future product assortments be based on consumer surveys? A: Yes, future assortments will be driven by consumer surveys. The company has conducted extensive research involving over 1,000 participants, including franchisees, to better align product offerings with consumer preferences. Q: What was the impact of exiting the specialty market customer relationship on revenue? A: The exit primarily affected the fourth quarter, as most sales from this seasonal customer occurred during that period. The impact was nearly $1.5 million in revenue. Q: How does Rocky Mountain Chocolate Factory evaluate the effectiveness of store remodels? A: The company evaluates remodels based on store sales, profitability, basket size, and average transaction value. Qualitative feedback from platforms like Google and Yelp also plays a role in assessing guest satisfaction with the new store design. Q: What is the current status of franchise development and expansion? A: The company is actively marketing new franchises and has 40 area development agreements in place. The focus is on attracting financially sophisticated operators capable of managing multiple units. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Management to Host Conference Call Tomorrow at 9:00 a.m. ET DURANGO, Colo., June 01, 2026 (GLOBE NEWSWIRE) -- Rocky Mountain Chocolate Factory, Inc. (Nasdaq: RMCF) (the “Company”, “RMCF”, or “Rocky Mountain Chocolate Factory”), America’s Chocolatier™, is reporting financial and operating results for its fiscal fourth quarter and full year ended February 28, 2026. “As outlined in our preliminary results announcement last month, fiscal 2026 was a year of significant operational transformation for Rocky Mountain Chocolate Factory,” said Jeff Geygan, Interim CEO. “While fourth quarter sales were impacted by challenges within our packaged product assortment and several temporary factors, we made substantial progress improving the underlying economics of the business. Through pricing, product mix and operational initiatives, we achieved our strongest product margin profile in approximately two years and moved closer to our long-term gross margin objectives.” “Importantly, the actions we have taken over the past year have strengthened the foundation of the business. We have improved production efficiency, enhanced our data and analytics capabilities, expanded customer engagement initiatives and continued to advance franchise development opportunities. As our margin profile continues to improve, our focus is increasingly shifting toward driving sustainable revenue growth, improving execution in our packaged and e-commerce channels, and converting the operational progress we have made into consistent earnings performance.” Fiscal Fourth Quarter 2026 Financial Results vs. Year-Ago Quarter Total revenue was $6.8 million in the fourth quarter of fiscal 2026 compared to $8.9 million in the fourth quarter of fiscal 2025. The decrease in revenue primarily reflects the underperformance of the Company’s packaged boxed assortment business, the deliberate reduction of certain low- or negative-margin Specialty Markets business, and select temporary items during the quarter. Total product and retail gross profit was $(0.9) million in the fourth quarter of fiscal 2026 compared to $(0.8) million in the fourth quarter of fiscal 2025. The decrease was primarily attributable to disposal of supplies with old branding. Total costs and expenses decreased to $9.8 million in the fourth quarter of fiscal 2026 compared to $11.6 million in the fourth quarter of fiscal 2025. The decrease was primarily attributable to efficiencies obtained by relocating our consumer packaging operations back to our Durango production facility. Net loss from continuing operations was $3.4 million or $(0.38) per share in the fourth quarter of fiscal 2026, compared to a net loss from continuing operations of $2.9 million or $(0.37) per share in the fourth quarter of fiscal 2025. EBITDA was $(2.6) million in the fourth quarter of fiscal 2026 compared to $(2.5) million in the year-ago quarter. The decrease was primarily attributable to the recognition of deferred tax liabilities. Fiscal Year 2026 Results vs. Fiscal Year 2025 Total revenue was $27.5 million in fiscal 2026 compared to $29.6 million in fiscal 2025. Total product and retail gross profit increased to $0.7 million in fiscal 2026 compared to $0.1 million in fiscal 2025. Total costs and expenses improved to $31.1 million in fiscal 2026 compared to $35.5 million in fiscal 2025. Net loss from continuing operations improved to $4.6 million or $(0.56) per share in fiscal 2026 compared to a net loss from continuing operations of $6.1 million or $(0.86) per share in fiscal 2025. EBITDA was $(2.1) million in fiscal 2026 compared to $(4.7) million in the year-ago quarter. Conference Call Information The Company will conduct a conference call to discuss its financial results. A question-and-answer session will follow management’s opening remarks. The conference call details are as follows: Date: Tuesday, June 2, 2026Time: 9:00 a.m. Eastern timeDial-in registration link: hereLive webcast registration link: here Please dial into the conference call 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact the Company’s investor relations team at [email protected]. The conference call will also be broadcast live and available for replay in the investor relations section of the Company’s website at https://ir.rmcf.com/. About Rocky Mountain Chocolate Factory, Inc. Rocky Mountain Chocolate Factory, Inc. is a leading franchisor of premium chocolate and confectionary retail store concept. As America’s Chocolatier™, the Company has been producing an extensive line of premium chocolates and other confectionery products, including gourmet caramel apples since 1981. Headquartered in Durango, Colorado, Rocky Mountain Chocolate Factory is ranked among Entrepreneur’s Franchise 500® for 2026. The Company and its franchisees and licensees operate over 250 Rocky Mountain Chocolate stores across the United States, with several international locations. The Company's common stock is listed on the Nasdaq Global Market under the symbol "RMCF." Forward-Looking Statements This press release includes statements of our expectations, intentions, plans and beliefs that constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to come within the safe harbor protection provided by those sections. These forward-looking statements involve various risks and uncertainties. The statements, other than statements of historical fact, included in this press release are forward-looking statements. Many of the forward-looking statements contained in this document may be identified by the use of forward-looking words such as "will," "intend," "believe," "expect," "anticipate," "should," "plan," "estimate," "potential," or similar expressions. However, the absence of these words or similar expressions does not mean that a statement is not forward-looking. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future - including statements regarding future financial and operating results and anticipated outcomes of our business strategy and plan are forward-looking statements. Management of the Company believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any such forward-looking statements because such statements speak only as of the date of this press release. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause our Company’s actual results to differ materially from historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to: inflationary impacts, changes in the confectionery business environment, seasonality, consumer interest in our products, receptiveness of our products internationally, consumer and retail trends, costs and availability of raw materials, competition, the success of our co-branding strategy, the success of international expansion efforts and the effect of government regulations. For a detailed discussion of the risks and uncertainties that may cause our actual results to differ from the forward-looking statements contained herein, please see the section entitled “Risk Factors” contained in our periodic reports, each filed with the Securities and Exchange Commission. Investor Contact Sean Mansouri, CFAElevate [email protected] GAAP to NON-GAAP Financial MeasuresThis press release includes a non-GAAP financial measure, EBITDA, which the Company defines as net earnings before interest expense, taxes on income, and depreciation and amortization. A reconciliation of EBITDA with GAAP net earnings attributable to the Company is included in this press release.