Lifecore (LFCR) Q4 Revenue Beats 3%

Key Points

• GAAP revenue exceeded expectations at $36.4 million in Q4 FY2025, Revenue beat analyst estimates by 2.76% (GAAP), despite a year-over-year decline.

• GAAP earnings per share showed a narrower loss of $(0.06) in Q4 FY2025, outperforming the estimated $(0.10) GAAP loss.

• Gross profit (GAAP) and adjusted EBITDA (non-GAAP) decreased year over year.

• These 10 stocks could mint the next wave of millionaires ›

Lifecore Biomedical (NASDAQ:LFCR), a contract development and manufacturing company focused on sterile injectable pharmaceuticals and hyaluronic acid (HA) products, reported fiscal fourth-quarter 2025 results on August 7, 2025. The company reported GAAP revenue of $36.4 million in Q4 FY2025, exceeding the analyst estimate of $35.4 million (GAAP), and narrowed its GAAP loss per share to $(0.06), beating the forecast $(0.10) GAAP loss. Despite revenue being down from the prior year, Lifecore showed improvement in operational efficiency and business development activity, closing the period with better-than-expected financials. However, Gross profit (GAAP) and adjusted EBITDA (non-GAAP) both declined year over year. Overall, the quarter delivered positive surprises on GAAP revenue and GAAP earnings, but margin pressures and ongoing net losses remain notable issues.

Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q3 2025 earnings report.

Business Overview and Key Success Factors

Lifecore Biomedical operates as a contract development and manufacturing organization (CDMO), delivering sterile injectable drugs and hyaluronic acid-based products to pharmaceutical and biotechnology clients. Its vertically integrated platform covers everything from producing HA raw materials to aseptic filling of finished products, supplying both drug makers and medical device companies.

The company's long-term success depends on expanding its specialized manufacturing capacity, maintaining strict quality and regulatory standards, and winning new and recurring development projects. Critical factors for Lifecore include the ability to support new pharmaceutical modalities, expand relationships with large partners, and maintain strong compliance with regulatory agencies like the Food and Drug Administration (FDA) and European Medicines Agency (EMA). Lifecore's recent focus has been on business development, expanding production through new machinery, and diversifying its customer base by signing contracts across more therapeutic segments.

Quarter in Review: Financial and Operational Developments

GAAP revenue of $36.4 million beat analyst expectations, thanks to strong HA manufacturing sales and ongoing demand from Lifecore's largest customer. However, this represented a 4% decrease compared to the same period in Q4 FY2024. The decline was primarily due to a $5.6 million drop in revenue from contract development and manufacturing projects that had completed in the prior year. HA sales, which are products made from hyaluronic acid used in injectables like eye treatments and joint care, rose by $4.1 million, offsetting much of the CDMO decline.

The company’s margins came under pressure. Gross profit (GAAP) dropped to $14.0 million, a 19.1% fall from the same period last year, driven by a shift towards less profitable sales, lower development revenue, and reduced manufacturing volumes in the CDMO business. Adjusted EBITDA, a commonly used profitability measure that excludes interest, taxes, depreciation, and some non-cash expenses, also fell to $9.1 million. This reflected the ongoing challenges in project mix and timing, even as Lifecore made strides in cutting costs and boosting process efficiency.

Operational achievements played a big role this quarter. Lifecore began operating its new high-speed automated aseptic isolator filler in September 2024, more than doubling its annual manufacturing capacity to an estimated $300 million in potential revenue. This major investment allows Lifecore to offer faster production and support a wider range of projects, including those beyond its core eye-care and joint-care offerings. The company also passed a key FDA inspection in March 2025 with no issues, a testament to its focus on quality and regulatory compliance.

New business wins marked another important theme. Lifecore signed three new early-stage programs, including one with a major international pharmaceutical company. In total, it landed nine new projects with new customers, expanding its reach into emerging treatment types. These included programs in GLP-1 therapeutics, dermatology, substance use disorder, and cancer radiation mitigation, signaling movement beyond its traditional strengths in ophthalmology.

Looking Ahead: Guidance and Strategic Priorities

For the transition period covering June to December 2025, Lifecore management expects revenue between $74 million and $76 million for the transition period, an adjusted EBITDA (non-GAAP) of $12–$14 million for the transition period, and a net loss (GAAP) of $17.8 million to $19.8 million for the transition period. These figures maintain the company’s annual run-rate revenue close to recent levels. Management reaffirmed its ambition for at least 12% annual revenue growth and adjusted EBITDA (non-GAAP) margins above 25%.

Investors will likely focus on whether the company can sustain new business wins, improve gross margins, and reduce its debt burden. Integration of the new production line, expansion into new therapeutic areas, and the upcoming launch of an upgraded enterprise resource planning (ERP) system will also be monitored as potential drivers for growth and operational improvements in the coming quarters.

Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.

Where to invest $1,000 right now

When our analyst team has a stock tip, it can pay to listen. After all, Stock Advisor’s total average return is 1,046%* — a market-crushing outperformance compared to 181% for the S&P 500.

They just revealed what they believe are the 10 best stocks for investors to buy right now, available when you join Stock Advisor.

See the stocks »

*Stock Advisor returns as of August 4, 2025

JesterAI is a Foolish AI, based on a variety of Large Language Models (LLMs) and proprietary Motley Fool systems. All articles published by JesterAI are reviewed by our editorial team, and The Motley Fool takes ultimate responsibility for the content of this article. JesterAI cannot own stocks and so it has no positions in any stocks mentioned. The Motley Fool has positions in and recommends Lifecore Biomedical. The Motley Fool has a disclosure policy.