Hain Celestial Revenue Drops 13% in Q4

Key Points

• Revenue fell 13.2% to $363 million in Q4 FY2025, with organic net sales down 11% year-over-year due to lower volume and category declines.

• Adjusted earnings turned negative, with adjusted EPS at $(0.02).

• Management did not provide financial guidance for the next fiscal year, citing a lack of near-term visibility.

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Hain Celestial Group (NASDAQ:HAIN), a maker and marketer of natural and organic food and personal care brands, reported fourth-quarter results on September 15, 2025, covering the period ended June 30. The key news was a significant drop in revenue and profits as operational challenges weighed on the business, especially in North America and snacks. Management acknowledged that the quarter’s results missed its own expectations, prompting more urgent cost-saving and restructuring efforts, while offering no financial outlook for the upcoming fiscal year.

About Hain Celestial Group and Recent Areas of Focus

Hain Celestial Group is an established provider of organic and natural food and beverage products, as well as some personal care items. Its product categories include snacks, baby and kids foods, beverages such as teas and non-dairy drinks, meal preparation staples like oils and nut butters, and personal care lines which are currently being reviewed for divestiture.

The company spans a global footprint, with operations segmented into North America and International businesses. Recent strategy centers around the “Hain Reimagined” transformation program, which aims to streamline the brand portfolio, strengthen cost controls, and boost profitability. Management tracks progress across areas like product innovation, operational efficiency, and competitive positioning, with product quality, brand relevance, and cost discipline among the most crucial success factors.

Fourth Quarter Results: Financial and Operational Performance

For the quarter, revenue fell by 13.2% year-over-year, driven by an 11% drop in organic net sales. The decline in organic net sales was due entirely to lower sales volumes, while prices on branded products were unchanged compared to the previous year. North America experienced the sharpest drop, with net sales declining by 20.8% and organic net sales down 14.4%. International revenue proved more resilient, decreasing by 1% year-over-year and 6% organically.

The bottom-line results also turned negative. The company reported a net loss of $273 million, compared to a $3 million loss in Q4 FY2024, primarily due to $252 million of non-cash impairment charges. Adjusted net income, which strips out such one-time items, was a loss of $2 million. Adjusted EBITDA, a measure of operating cash profit before interest and taxes, dropped by half to $20 million. Adjusted gross margin narrowed to 20.5%, down nearly 3 percentage points from the prior year.

The Snacks category experienced the steepest contraction, with organic net sales down 19%. Management specifically cited continued “velocity challenges and distribution losses” in snack products during the quarter and FY2025. Baby & Kids organic net sales fell 9%, driven by softer demand for fruit purees and the effects of reducing the number of product lines (SKU rationalization). Beverage sales, which include teas and non-dairy drinks, fell 3% on an organic basis in fiscal year 2025, reflecting weak performance in North American tea brands and private label non-dairy drinks abroad. Meal prep, a category covering cooking ingredients like oils and nut butters, also fell 8% in organic net sales on lower demand in the U.S. and mixed results in the United Kingdom.

On a regional basis, North America accounted for the greatest weakness in the quarter. The segment saw a 33% year-over-year drop in gross profit, gross margin fell from 22.6% in Q4 FY2024 to 19.2%, as lower volumes combined with higher promotional spending. The International segment also saw lower profit and margins but declined less sharply, with International adjusted EBITDA margin ending at 13.3% versus 17.0% a year earlier.

Cash flow from operations was poor, with free cash flow at negative $8.9 million. This compares with positive $31 million in the year-ago quarter. That figure still reflects a net secured leverage ratio of 4.7 times EBITDA, which is considered high for a packaged food company. Hain Celestial amended its credit agreement to raise its leverage limit, indicating caution about staying in compliance with financing covenants if earnings remain weak.

No new data about key customer relationships were provided in the release. Walmart, which made up approximately 18% of consolidated sales in FY2023, remains a critical partner. Management did not specifically address any changes related to this relationship during the quarter.

During the quarter, the company recorded substantial non-cash impairment charges during the quarter and FY2025. Goodwill write-downs reached $227 million, with an additional $25 million in impairments tied to intangible assets and assets held for sale. The transformation plan is intended to deliver annualized pretax savings of $130 million to $150 million, with cumulative pretax charges expected to total $115 million to $125 million by the end of FY2027.

Looking Forward: Guidance and Key Watchpoints

Management did not provide financial guidance for fiscal 2026 or beyond. The absence of a revenue, profit, or cash flow forecast was attributed to an ongoing strategic review. Leaders signaled that efforts to “stabilize” the business and reduce costs remain a high priority. A formal strategic review with an external adviser continues, but there are no announced outcomes or changes to the company’s business plan at this time.

The company’s high leverage and exposure to categories under competitive pressure--especially in North American snacks--remain concerns, as does its dependency on a few large retail customers.

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

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