RMCF

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.

DURANGO, Colo., May 14, 2026 (GLOBE NEWSWIRE) -- Rocky Mountain Chocolate Factory, Inc. (Nasdaq: RMCF) (the “Company”, “RMCF”, or “Rocky Mountain Chocolate Factory”), America’s Chocolatier™ today announced preliminary financial and operational results for its fourth quarter and fiscal year ended February 28, 2026. Fourth Quarter and Fiscal Year 2026 Preliminary Financial Results The following ranges are based on preliminary, unaudited estimates, and the Company expects to report final audited results within these ranges: *The percentages shown represent the year-over-year change calculated using the midpoint of the estimated ranges. **Non-GAAP measure. “While our fourth quarter results were below expectations, we continued to make meaningful progress executing the operational and strategic initiatives designed to improve profitability and position the business for sustainable long-term growth,” said Jeff Geygan, Interim CEO. “Over the past year, we implemented multiple pricing, operational and product mix adjustments that materially improved the underlying economics of the business moving closer to our long-term target range product gross margin.” “During the quarter, we made the deliberate decision to reduce certain low or negative-margin Specialty Markets business, which negatively impacted revenue but supported stronger overall margin performance and improved product mix. Results were also impacted by temporary disruption associated with our e-commerce transition, disposal of packaging with outdated branding, and elevated professional fees related to ongoing litigation activities.” “We continue to see encouraging performance trends across our retail footprint, particularly in newer-format and remodeled stores. Our Chicago State Street location is performing at an approximate $1 million annualized sales rate, while our Corpus Christi remodel generated an approximate 11% sales increase following reopening. We are also encouraged by early performance trends in Charleston and Concord Mills, and our recently acquired Nashville corporate store provides another opportunity to test merchandising, operational and customer engagement initiatives.” “In parallel,” Geygan continued, “we are advancing multiple initiatives to strengthen customer engagement and support future growth across both franchise and company-owned channels. We expanded deployment of our upgraded POS platform, increased third-party delivery penetration and continued development of our loyalty and mobile app ecosystem, with the new app expected to launch late summer. At the same time, we remain focused on additional opportunities to optimize our cost structure and improve operating efficiency.” “Looking ahead, development activity across the system is encouraging. We recently added a new six-store area development agreement, increasing committed future development to 40 locations over the next several years. We continue to advance new store opportunities in key growth markets, including Miami and Chicago, while preparing for upcoming openings in New Jersey, California and Houston International Airport.” “Additionally, we are positioning for the rollout of an upcoming collaboration with Miraculous, the popular animated children’s series. This promotion will feature a limited-time caramel apple offering and immersive in-store merchandising designed to create a highly visual and engaging customer experience. We believe these initiatives reflect continued momentum in strengthening the Rocky Mountain Chocolate Factory brand and positioning the Company for improved long-term financial performance.” *The financial information in this press release is preliminary, unaudited, based on currently available information, and subject to adjustment in the final financial statements to be filed with the Company’s Annual Report on Form 10-K for the twelve months ended February 28, 2026. 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 the Company's common stock is listed on the Nasdaq Global Market under the symbol "RMCF." Forward-Looking Statements This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding anticipated benefits of the company’s omnichannel strategy and multi-year transformation strategy, including the Company's corporate-operated store located in Nashville, Tennessee at Opry Mills, our new point-of-sale platform, the recently launched third-party delivery and catering service integration. Forward-looking statements are based on current expectations and assumptions and are subject to risks and uncertainties that could cause actual results to differ materially. These risks and uncertainties are described in the company’s filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q. The Company undertakes no obligation to update any forward-looking statements except as required by law. Investor Contact Sean Mansouri, CFA Elevate IR 720-330-2829 [email protected]

Image source: The Motley Fool. Jan. 14, 2026 at 9 a.m. ET Chief Executive Officer — Jeffrey Geygan Chief Financial Officer — Carrie Cass Jeffrey Geygan: Good morning, and thank you for joining us. During the third quarter, we continued to execute our margin-first transformation strategy, making deliberate decisions to prioritize profitability and long-term value creation over lower quality revenue. While these actions resulted in near-term revenue pressure and a modest net loss for the quarter, they are foundational to restoring long-term sustainable growth and shareholder value creation. The results from this quarter reflect important progress in our efforts as we delivered meaningful improvement in gross profit and margin. We continue to believe there's a clear path to maintain and further expand margins as we strengthen the foundation of our business. Our business transformation is focused on disciplined execution, improving product mix, implementing thoughtful price actions, simplifying our SKU portfolio, and building the operational and technology capabilities required to support long-term growth. While we are still navigating some persistently higher input costs and near-term inefficiencies related to our production transition, the actions we've taken are now showing in our financial results. We are also very encouraged by the momentum we are seeing with our franchise development pipeline. We currently have two new stores under construction and 34 stores under recently negotiated area development agreements, demonstrating interest from well-capitalized, financially sophisticated, new, and existing operators. Our franchise development team is working on building an additional backlog of new franchise opportunities supported by our clear messaging with a refreshed brand direction and targeted digital marketing efforts to identify the right partners to grow and succeed with our brand. I'll now step through several highlights from the quarter, including our operational progress, franchise development momentum, and continued execution across technology and e-commerce initiatives. During the quarter of the past year, we continued to make intentional decisions to exit lower margin special and wholesale revenue streams. While this resulted in a modest year-over-year decline in total revenue, it predictably contributed to a significant improvement in gross profit dollars and margin. We reported a 21.4% gross manufacturing margin for the quarter ended November 30, 2025, compared to 10% for the same quarter of the prior year and a negative 0.6% for the previous quarter ended August 31. We are pleased with this progress while recognizing there's room for further improvement. We've implemented a series of targeted price adjustments over the past year and as recently as January 2. All designed to achieve a specific margin objective across our four core franchise categories, including bulk candies, packaged goods, supplies, and ingredients. These adjustments were not uniformly upward. In fact, some prices remained unchanged while others were reduced. As we attempt to optimize our sales mix and throughput across our network of over 250 franchised and licensed locations. Collectively, these adjustments are expected to support margin expansion over time in a balanced way that enables strong economic results for our franchise and licensed partners as well as the company. In addition to price adjustments, we are beginning to realize the benefits from SKU rationalization and production labor efficiencies. This includes the elimination of hundreds of low-contributing SKUs, the elimination of temporary labor, and a large reduction in overtime hours and improved production scheduling. We also added a second production shift at the Chocolate Factory to provide greater flexibility and efficiencies in scheduling and maintenance. We believe there's an additional $500,000 to $1,000,000 of savings that can be realized in our current cost structure. This disciplined rationalization highlights the cornerstone of the new company culture: simplify production, reduce operational complexity, and improve manufacturing throughput. Looking ahead, we expect to recognize the benefit from lower input costs, including the recent elimination of an approximate 10% tariff on cocoa. As cocoa prices have come down in recent months, we have executed a thoughtful and timely purchasing strategy that directly impacts our cost of chocolate and have locked in nearly 20% of our expected annual consumption volume at recent favorable prices. Franchise development remains a key strategic revenue pillar of our long-term business plan, as momentum continued to build during the quarter and beyond. We currently have two new stores under construction and 34 stores under area development agreements. Reflecting growing interest from experienced multi-unit operators aligned with our refreshed strategy and brand direction. These agreements generally contemplate a four to five-year build-out period with the initial store construction required within the first year and sequenced annually thereafter. We'll provide ongoing details as leases are signed, and construction is initiated. Our focus remains on quality over quantity as we partner with operators who are well-capitalized, operationally sophisticated, and committed to building long-term value within the Rocky Mountain Chocolate Factory, Inc. network. At the same time, we are rationalizing our current store base by allowing the closing of underperforming locations that contribute minimal revenue and can negatively impact our premium brand image. While new store openings are conducted at a measured pace, our team is working to reduce overall development costs and shorten the timeline from lease signing to opening, which currently stands at about six months. We believe this disciplined approach positions us well to expand thoughtfully into both existing and new markets over time while improving average unit performance across our network. We hired a new VP of franchise development in August. He attended our September national franchise convention and engaged with well over a dozen current franchisees to lay out a vision for future growth and area development agreements. Our franchise development team is working actively through a sizable backlog of new franchise opportunities supported by improved digital marketing capabilities and a rigorous selection process with prospective partners. We are entering a new era of growth but not growth for growth's sake. We will be very intentional with every move we make and every franchisee partner we add. We remain focused on increasing store ownership per franchisee, which improved from 1.34 to 1.39 stores when we first cited this number. We expect our disciplined approach to area development and franchisee recruitment will drive meaningful long-term results for our network performance. Turning to a rebrand, all stores have fully transitioned to our new packaging with legacy copper packaging phased out on November 30. For the new store layout and designs, full remodels are scheduled to begin after March 1, with the goal of completing the majority of remodels by October 2026 ahead of the holiday season, and virtually all stores aligned with our new brand identity within 24 months. Remodels will include new exterior signage, updated interior layouts, and enhanced merchandising designed to create a more consistent and engaging customer experience across all stores, whether new or remodeled. Our newer stores in Chicago, Illinois, and Charleston, South Carolina continue to meet our expectations. Chicago opened on December 11 and was well received in a community where we have good existing brand awareness, due to our multiple locations in the metro area. Daily sales trends are encouraging. Our Charleston location opened on June 3 and has developed nicely despite it being the first Rocky Mountain Chocolate Factory, Inc. store in the state of South Carolina. Sales are continuing to trend higher. Our company-owned store in Corpus Christi, Texas was remodeled in August and has since experienced consistent growth and on several occasions recognized daily sales results of over $4,000. As a reference point, we target $2,800 per day in sales as the benchmark for a $1,000,000 location. We've successfully experimented in both our Durango, Colorado, and Camarillo, California company stores with new merchandising strategies to improve store sell-through. The early results have been encouraging. As we learn more, the feedback will allow us to create a template for stores across the network. We work to deploy best practices in all locations as well as with each new store opening. Our goals continue to be increasing store sales and improving store-level profitability. We expect our average unit volume to increase again this year. We're also advancing our digital initiatives. DoorDash storefronts are now live, a white-labeled zero-commission model that enhances unit-level economics for franchisees. Each store now maintains its own branded online presence, supported by improved social media and digital integration. We recently created a new unique store website for 100% of our domestic locations. Those can be easily accessed from rmcf.com's store locator or directly through a web search. This development allows customers to buy online for local pickup or delivery while routing the customer to the store's own white-label DoorDash site. We plan to add additional customer functionality to store websites as we continue to develop this important revenue channel. In addition, our loyalty program remains under active development with vendor engagement underway, and an expected rollout in the 120 stores are now live on our new POS system, providing significantly richer data flows than we've historically had to. Including customer transaction activity, average ticket size, basket composition, and cross-selling activity. As POS penetration increases, we expect to have increased visibility into and near real-time awareness of customer behavior and store-level performance. Creating an opportunity to benefit from more informed data-driven decisions that enhance franchisee performance over time. Our ERP system implementation continues to evolve as we're realizing more efficient operational execution. There's more process improvement under development that we believe will reduce production costs. While we have seen some benefit to date, we continue to refine and customize the platform to better align with our operating model and internal reporting needs. These multiple technological initiatives are strengthening how customers experience our brand and how efficient we are at the chocolate factory. They represent the next stage of our development, a consistent, elevated engagement that supports long-term franchisee success and a memorable customer experience. Subsequent to quarter-end, we completed a $2,700,000 equity capital raise, allowing us to pay down $1,200,000 of debt and retain $1,500,000 in additional working capital. While this is not reflected in our financials as of November 30, it's important to note that our strengthened balance sheet provides greater flexibility for us to invest in our operations, franchise development, and technology initiatives moving forward. As we step back and look at the big picture, this quarter represents an important inflection point in our transformation. The decisions we've made over the past eighteen months, including exiting low-margin revenue sources, simplifying our business strategy, focusing on growing our franchise network, resetting our cost structure, and strengthening our balance sheet, are beginning to materialize with improved gross profit and margin and a more resilient operating model. There's still work ahead. However, we believe these actions have materially improved our positioning for sustainable long-term growth and return to profitability. We believe we have a stronger balance sheet in place to better manage our working capital and return to positive cash flow generation over the coming quarters. We continue to invest in our people as we add strategically important resources to both our team in and away from our Durango headquarters. People are our greatest asset and responsible for the ultimate realization of our long-term results. We are developing a culture of continuous improvement which is foundational to our success. In addition to ongoing executive team professional development, we're also committed to professional development and career advancement for a larger group. Our leadership team provides essential strategic support execution alongside our executive team. Our focus remains on returning to profitability through disciplined execution, supporting franchisees, and scaling our network thoughtfully with the right partners, as we continue to innovate and expand our premium confectionery franchise business model. Thank you for your attention. I'll now turn the call over to our chief financial officer, Carrie Cass, to walk you through our fiscal third-quarter financial results. Carrie? Carrie Cass: Thank you, Jeff. Please note that unless otherwise stated, all comparisons are on a year-over-year basis. For the 2026Q3, total revenue was $7.5 million compared to $7.9 million in the prior year. This decline reflects our intentional exit from low or negative margin revenue streams as part of our margin-first strategy. Total product and retail gross profit increased to $1.4 million in the 2026Q3 compared to $700,000 in the same quarter last year. Driven by pricing actions, improved product mix, and labor efficiencies. While these gains were partially offset by short-term operational inefficiencies related to higher material costs and freight costs, we're continuing to optimize our manufacturing and cost structure and expect to maintain these margins moving forward. Total costs and expenses improved to $7.5 million, down from $8.6 million in the same quarter last year, with savings realized across nearly all areas of operations. Net loss for the quarter was $200,000 or negative 2¢ per share, compared to the net loss of $800,000 or negative 11¢ per share in the prior year. EBITDA was $400,000 in the 2026Q3 compared to a negative $400,000 in the same quarter last year. With improvement driven by aforementioned increases in gross profit, lower costs, and expenses. This concludes our prepared remarks. Operator, back to you. Operator: Ladies and gentlemen, if you have a question or a comment at this time, one moment for our first question. First question comes from Doug Garber with West Alpha. Your line is open. Doug Garber: Hi. Good morning, and congrats on the good quarter. Jeff, can you talk a little bit about the 34 new stores, the agreement there? And the pace of deployment and what else you have in the pipeline for other areas and what you're targeting for store growth in the future. Jeffrey Geygan: Yeah. Good morning, and thank you, Doug. The 34 current area development agreements are across four unique franchisees, three of whom are existing franchisees, one of whom is new to the system. Our franchise development department has other prospective area development agreements in queue. We expect to add to the total over time. The rollout of these would be on a measured basis but accelerating into the later years. All of the agreements are designed to either have stores started within three or four years and the totals completed within four or five years. Doug Garber: How have you lined up the financing for these stores? Do the existing owners have liquidity or debt facilities or equity lined up to execute this plan? Jeffrey Geygan: They do. And as you have noted in our recent comments, we're focused on partnering with well-capitalized and financially sophisticated individuals, necessarily meaning that their need to put significant debt on to build a store is minimal. Doug Garber: Great. And on the profitability, it looks like your initiatives over the last year are starting to show in the P&L. I'm trying to understand the cocoa price impact because that has come down. And how much more of a margin tailwind that will be as the prices normalize from what's happened in the current market into your P&L over the next couple of quarters? How much more margin expansion do you expect? Jeffrey Geygan: Well, as we speak, the cocoa futures are trading at just over $5,100. Keep in mind that for many years, cocoa traded between $1,500 and $3,000 a metric ton. In a relatively short period of time, they spiked to close to $12,000. Then for the subsequent probably eighteen to twenty-four months, they held it between $8,000 and $12,000. When we began initiating a strategy to lock in future pricing, we really used $8,000 as a ceiling, and we've been successful with that. Recently, we were able to lock it in closer to $5,000 for roughly 20% of our expected production this year. Bear in mind, we consume chocolate, not cocoa, but directionally, our chocolate price moves with the cocoa price. I don't think we've rendered a view publicly in terms of the potential impact other than to say as cocoa prices come down, they represent chocolate represents a substantial part of our raw material cost. So I think you can expect we'll have a margin tailwind here. Doug Garber: Have you disclosed maybe, Carrie, what percent of your raw materials are chocolate, or cocoa, if you're able to break it down to the actual raw ingredient? Carrie Cass: That's something we have not disclosed. Doug Garber: Okay. Last one, Jeff, on the balance sheet, you've added equity now twice. Where are we in that journey of, call it, recapping the balance sheet since you've been the interim CEO? And where are you trying to take that in the future? Jeffrey Geygan: Yes. Of course. All these decisions are board decisions. But, we reducing debt think the next leg of our capital allocation plan will be investing in the company, all of which we presume will be coming from free cash flow as opposed to additional equity issuance. Doug Garber: Great. Well, it's good to see all your hard work in the P&L now. So congratulations to both of you. I know you've been working very hard. I'll turn it back. Jeffrey Geygan: Yep. Thank you very much. And there's more work to be done for sure, but we think directionally, it indicates that we're making progress. Operator: Moment for our next question. Our next question comes from Peter Sidoti with Sidoti and Company LLC. Your line is open. Peter Sidoti: Hi. Good morning. Could you just talk about when do you expect the accelerated franchise effort to begin affecting the top line? Jeffrey Geygan: And I'm sorry, Peter. You broke a little bit. Did you repeat that, please? Peter Sidoti: When do you expect the accelerated franchising effort to begin showing up on the top line? Jeffrey Geygan: Yeah. It's a great question. From opening to maturity, we assume a store will take roughly three years. From lease signing to store opening, that takes roughly six months. The lease process takes anywhere from two to four months. So there's somewhat of a lag in terms of a store being announced to it actually being fully productive. At this point, I think we've been fairly public. We would have very little interest in supporting the opening of a store that we don't think can generate at least a million dollars in annual sales at retail over three years in a three-year period. So I think you can back into any type of modeling you're doing based upon the flow of stores. Not knowing that it's critical for us to have new stores, not just to improve the quality of our network, but to drive long-term profitability. Peter Sidoti: Right. So is it fair to say you don't expect any dramatic revenue growth in 2026 at this point? And really expect the efforts to start showing up next year? Jeffrey Geygan: If you're talking exclusively about additional revenue growth from new stores, I would say yes. But we have a network of 140 stores where there is substantial opportunity for us to have more chocolate factory product being represented and sold through those stores. So we're hyper-focused on local store mix and increasing same-store sales. In addition, we do have an e-commerce channel and we also have specialty markets and intend to try to penetrate that further with the caveat being only where we make an appropriate margin. Peter Sidoti: Okay. And you've been there for a while and really have done an excellent job. What's the biggest obstacle you now feel that you're facing when looking at growing the business? Is it financial? Is it market? Is it just people? Execution. Jeffrey Geygan: Yeah. We just need to do a better job at executing profitably. Just as I cited in our call here, we think there's still more cost to come out. But this isn't a cost-saving story. This is a top-line story. So we have to be able to execute efficiently, but we need to grow our top line. And that's going to come primarily through our franchise system, principally from our existing franchise base, supplementally from the new stores. Peter Sidoti: Okay. Thank you very much. And congratulations on the financing. It was spectacular in terms of what you accomplished, so thank you. Jeffrey Geygan: Thanks, Peter. I appreciate that. Operator: And I'm not showing any further requests at this time. I'd like to turn the call back over to Jeff and Carrie to see if you have any closing remarks. Jeffrey Geygan: Thank you, operator. That's all we have for you today. Appreciate your dialing in. Look forward to updating you in the next three months. Operator: Thank you, ladies and gentlemen. This does conclude today's presentation. 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See the 3 stocks » *Stock Advisor returns as of January 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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Rocky Mountain (RMCF) Earnings Call Transcript was originally published by The Motley Fool

Shares of Rocky Mountain Chocolate Factory, Inc. RMCF have lost 2% since the company reported earnings for the quarter ended Nov. 30, 2025, compared with a 0.4% loss for the S&P 500 Index over the same period. Performance over the past month has been notably stronger, however, with shares gaining 24.1%, well ahead of the S&P 500’s 3.9% rise during that time. For the third quarter of fiscal 2026, Rocky Mountain reported total revenues of $7.5 million, down from $7.9 million in the year-ago quarter, reflecting a 4.4% year-over-year decline. Management attributed the decrease primarily to the company’s intentional exit from lower-margin specialty and wholesale channels as part of its margin-first strategy. Despite the top-line pressure, profitability metrics showed marked improvement. Net loss narrowed to $0.2 million, or $0.02 per share, from a loss of $0.8 million, or $0.11 per share, in the prior-year quarter. Total product and retail gross profit increased to $1.4 million in the third quarter of fiscal 2026 from $0.7 million in the year-ago quarter, driven by pricing actions, improved product mix and labor efficiencies. EBITDA swung to a positive $0.4 million from a loss of $0.4 million in the comparable period last year, highlighting the impact of cost reductions and improved operating leverage. Gross manufacturing margin improved significantly during the quarter, reaching 21.4% compared with 10% in the same quarter last year and negative 0.6% in the immediately preceding quarter. Total costs and expenses declined 13.2% to $7.5 million from $8.6 million a year ago, with savings realized across most operating categories, including general and administrative expenses and cost of sales. While higher raw material and freight costs continued to weigh on results, these pressures were partially offset by SKU rationalization, reduced overtime and better production scheduling. RMCF also added a second production shift at its chocolate factory, which management believes can unlock additional annual cost savings of $500,000 to $1 million. On the balance sheet, cash and cash equivalents stood at $0.6 million at the quarter’s end compared with $0.7 million as of Feb. 28, 2025, while inventories declined during the same period, consistent with SKU rationalization and production streamlining efforts. Rocky Mountain Chocolate Factory, Inc. price-consensus-eps-surprise-chart | Rocky Mountain Chocolate Factory, Inc. Quote Management emphasized that the quarter marked an inflection point in its ongoing transformation. Leadership reiterated its focus on prioritizing profitability and long-term value creation over near-term revenue growth. Executives highlighted progress across several initiatives, including disciplined pricing adjustments, simplification of the SKU portfolio and investments in operational and technology capabilities. Management also pointed to encouraging momentum in franchise development, supported by renewed brand positioning and targeted digital marketing efforts, as a key driver of future growth. The decline in revenue was largely the result of deliberate actions to exit lower- or negative-margin revenue streams, which management views as necessary to reset Rocky Mountain’s economic foundation. On the cost side, short-term inefficiencies related to production transitions and elevated input costs continued to affect results, though these were offset by improved labor efficiency and product mix. Cocoa price volatility also played a role during the quarter, but management noted that recent declines in cocoa prices and the elimination of an approximately 10% tariff on cocoa should provide a margin tailwind in the coming periods. RMCF has locked in nearly 20% of its expected annual chocolate consumption at more favorable recent prices. Rocky Mountain did not issue formal quantitative guidance but outlined expectations for continued margin improvement and a gradual return to profitability. Management indicated that meaningful revenue contributions from new franchise locations are likely to take time, given typical store build-out and maturation periods. Near-term growth is expected to come primarily from improving same-store sales, expanding e-commerce capabilities and selectively growing higher-margin channels, rather than rapid unit expansion. Subsequent to the end of the quarter, Rocky Mountain completed a $2.7 million equity capital raise. The proceeds were used to pay down $1.2 million of debt, with the remaining $1.5 million retained as additional working capital. During the quarter, the company also executed an area development agreement with four franchisees that will bring 34 new stores to market over a four- to five-year period. Management described this agreement as a milestone that reflects growing interest from well-capitalized, multi-unit operators and supports RMCF’s long-term strategy of disciplined, franchise-led growth. Rocky Mountain also continued rolling out technology initiatives, including expanded point-of-sale adoption across more than 120 stores, DoorDash storefront integration and the development of a loyalty program expected to launch in the first half of the calendar year. No acquisitions or divestitures were announced during the quarter, but management continued to rationalize underperforming stores and simplify the operating footprint as part of its broader restructuring efforts. 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). 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This article first appeared on GuruFocus. Total Revenue: $7.5 million, down from $7.9 million in the prior year. Gross Manufacturing Margin: 21.4%, up from 10% in the same quarter of the prior year. Total Product and Retail Gross Profit: $1.4 million, up from $0.7 million in the prior year. Total Costs and Expenses: $7.5 million, down from $8.6 million in the prior year. Net Loss: $0.2 million or 0.02 cents per share, compared to a net loss of $0.8 million or 0.11 cents per share in the prior year. EBITDA: $0.4 million, compared to a negative $0.4 million in the prior year. Store Locations: Over 250 franchised and licensed locations, with two new stores under construction and 34 stores under area development agreements. Warning! GuruFocus has detected 8 Warning Signs with RMCF. Is RMCF fairly valued? Test your thesis with our free DCF calculator. Release Date: January 14, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Rocky Mountain Chocolate Factory Inc (NASDAQ:RMCF) reported a significant improvement in gross manufacturing margin, increasing to 21.4% from 10% year-over-year. The company successfully executed a $2.7 million equity capital raise, strengthening its balance sheet and providing additional working capital. RMCF is seeing positive momentum in its franchise development pipeline, with two new stores under construction and 34 stores under area development agreements. The company has implemented targeted price adjustments and SKU rationalization, leading to improved product mix and labor efficiencies. RMCF is advancing its digital initiatives, including the launch of DoorDash storefronts and new POS systems, enhancing unit-level economics and data-driven decision-making. RMCF experienced a modest net loss for the quarter, attributed to near-term revenue pressure from exiting low-margin revenue streams. The company is still navigating higher input costs and operational inefficiencies related to its production transition. Total revenue for the fiscal third quarter decreased to $7.5 million from $7.9 million in the prior year. There is a lag in revenue growth from new store openings, as it takes time for stores to become fully productive. RMCF faces challenges in executing its growth strategy, with a need to improve execution and grow the top-line through its franchise system. Q: Can you discuss the 34 new stores and the pace of deployment, as well as future store growth targets? A: The 34 area development agreements involve four franchisees, three existing and one new. We plan to add more agreements over time. The rollout will be measured but will accelerate in later years, with stores expected to start within three to four years and complete within four to five years. Q: How have you arranged financing for these new stores? A: We are partnering with well-capitalized and financially sophisticated individuals, minimizing the need for significant debt to build stores. Q: How will the recent decrease in cocoa prices impact your margins? A: Cocoa futures have decreased, and we have locked in favorable prices for 20% of our expected production. As cocoa prices decrease, we expect a margin tailwind since chocolate is a substantial part of our raw material costs. Q: When do you expect the accelerated franchising effort to impact the top line? A: It takes about three years for a store to mature from opening. From lease signing to opening takes about six months. We expect new stores to generate at least $1 million in annual sales, contributing to long-term profitability. Q: What are the biggest obstacles you face in growing the business? A: Execution is key. We need to execute profitably and grow the top line, primarily through our franchise system and existing franchise base, supplemented by new stores. For the complete transcript of the earnings call, please refer to the full earnings call transcript.