Once Upon a Farm Fourth Quarter Fiscal 2025 Earnings Call - IPO Fuels Cooler Rollout and 25%-29% Sales Guidance With Near-Breakeven EBITDA

Reed Anderson, Moderator, ICR: Greetings. Welcome to Once Upon a Farm’s fourth quarter fiscal 2025 earnings conference call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Reed Anderson with ICR. Thank you. You may begin.

Reed Anderson, Moderator, ICR: Thank you, and welcome to the Once Upon a Farm fourth quarter 2025 earnings conference call, and first as a public company. With us on the call today are John Foraker, Chief Executive Officer and Co-founder, and Larry Waldman, President and Chief Financial Officer. By now, everyone should have access to the earnings press release that was issued earlier this afternoon and is available on the Investor Relations section of Once Upon a Farm’s website at onceuponafarmorganics.com. This call is also being webcast, and a replay will be available shortly after the call concludes. Before we begin, please note certain comments made on this call include forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

These forward-looking statements are based on management’s current expectations and beliefs concerning future events and are subject to several risks and uncertainties that could cause actual results to differ materially from those described in these forward-looking statements. Please refer to today’s press release and other filings with the SEC for a detailed discussion of the risks that could cause actual results to differ materially from those expressed or implied in any forward-looking statements made today. We do not undertake any obligation to update any forward-looking statements to reflect events or circumstances after the date of this call, except as required by law. During the call, we will use some non-GAAP financial measures as we describe business performance. The SEC filings, as well as the earnings press release, provide reconciliations of the non-GAAP financial measures to the most directly comparable GAAP measures.

Now, I will turn the call over to John to begin.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: Thanks, Reed. Good afternoon, everyone, and thanks for joining us today. We’re excited to share our fourth quarter results as a public company. Before I dive into our business performance, I wanna take you back to where this incredible journey began, because understanding our origins helps explain the passion and purpose that drives everything we do today. I will share some more fulsome than typical updates on our prior year’s performance, as this is our first earnings call. Once Upon a Farm was born from Cassandra Curtis’s love and determination to provide better nutrition for her children. After bringing her first child into the world, she couldn’t find baby food that met her high standards for freshness, taste, and nutrition at the grocery store, so she started making her own. That entrepreneurial instinct to solve her own problem created the company’s foundation.

What started in that one kitchen with a commitment to creating real, organic, farm-fresh food has grown into a movement that’s transforming childhood nutrition across America. From those early days selling at farmers markets, we’ve always believed that children deserve better than the available options that have historically dominated the market. When Jennifer Garner and I joined Cassandra Curtis and Ari Raz as co-founders in 2017, the very first thing we did together was draft our mission statement. "We exist to drive systemic improvements in childhood nutrition for a healthier, happier, and more equitable world." It’s impossible to overstate how critical these words and intentions have been in guiding us in the development of this brand and business over the years. Our mission remains unwavering and more relevant than ever.

We are shaping the future of food, and our mission informs every decision from what products we’ll make, to who we’ll hire, to what business partnerships we’ll enter into, and how and where we source. Our entire team is dedicated to delivering on this mission and building our strong company culture as we grow from here. This mission-led approach isn’t just marketing speak. It’s woven into our articles of incorporation as a Public Benefit Corporation, a PBC, where we are uniquely positioned to balance the financial interests of our stockholders with the broader impact we’re making on childhood nutrition and the communities we serve. All our work against our mission results in better products and deeply layered elements of impact that drive brand trust, loyalty, and word-of-mouth advocacy among consumers who care. When parents find a product and brand they love, they share with their personal networks in powerful ways.

The depth of our mission matters. From baby’s first bites to kids’ school-ready snacks, we’ve established ourselves as a rapidly growing leader in modern childhood nutrition, giving parents one trusted brand spanning babies’ first foods through older kids. Our journey demonstrates the power of our consumer-first approach and the massive opportunity we’re addressing in the childhood nutrition market. Our results speak to our remarkable growth trajectory. Since 2018, our net sales have grown at a compound annual rate of 63%, including a 53% year-over-year increase in 2025. We are the number one growth brand for retailers in the categories in which we participate, and we have a repeat purchase rate of over 50% from households with children and 60% from new families. Our products are now available in more than 25,000 doors nationwide.

What makes us particularly attractive to retailers is that we are a high-velocity, highly incremental brand that brings valuable consumers into the store. When they get there, they find our unique and growing presence across the store. We sell in both the fresh perimeter and center of store. The positioning provides convenience for consumers, whether they’re shopping on premises or online, while helping retailers attract larger basket shoppers and generate better margin outcomes. The incrementality we bring to our categories is significant and rare in consumer packaged goods. On the fresh perimeter, our kids’ snacking pouches are 69% incremental, and in the baby aisle and center store, our coolers are 61% incremental to the baby food category, while our dry baby snacks are 80% incremental to each baby and toddler snacking segment.

As a result, our brand helps drive 2-4 times larger baskets for our retailers, and we contribute significantly to growing the entire category. Retailers see the power of our brand and the results we deliver, and as a result, we have significant future growth opportunities ahead of us. Our brand’s farm-fresh-first approach has created deep, authentic connections with parents who share our values around childhood nutrition. This has resulted in exceptional consumer loyalty and advocacy that goes far beyond traditional brand metrics. The power of our brand is perhaps best demonstrated through word-of-mouth marketing, which has become increasingly significant for us. In 2025, over one-third of new consumers discovered the Once Upon a Farm brand through word of mouth. This authentic advocacy from parents who genuinely love our products provides us with cost-effective marketing that money simply can’t buy.

When parents become advocates for our brand, they’re not just recommending a product, they’re sharing their belief in our mission and values. Our brand strength is built on several key elements. First is trust. Parents know that when they choose Once Upon a Farm, they’re getting always USDA-certified organic products with no added sugar, no preservatives, and nothing artificial. Second is quality. Our cold-pressed approach and farm-fresh ingredients deliver taste and nutrition that kids actually crave. Third is convenience. We make it easy for parents to provide nutritious options for their children without compromising on quality. We believe we are building the first parent ally brand with a deep commitment to superior fresh products with high nutrition standards. 92% of our customers believe that Once Upon a Farm delivers the best overall nutrition.

Together with incredible taste from baby’s first foods all the way through kid, Once Upon a Farm’s positioning differentiates us in a crowded marketplace and creates emotional connections that drive long-term loyalty. Our growth strategy is built on four foundational pillars. Number one, growing brand awareness to drive increased household penetration. Number two, deepening and expanding reach with retailers. Number three, continuing innovation-led category disruption. And four, driving sustained profitable growth. Together, these pillars leverage our unique positioning in the childhood nutrition market to capitalize on the significant opportunities ahead of us. We’re making tremendous progress growing brand awareness to drive increased household penetration, our first strategic pillar. At the end of December, our household penetration stood at 5.1%, a 42% increase over the past year.

While this growth trajectory is encouraging, we recognize substantial runway remains when we consider that leading competitors average 12.5% household penetration or higher. Over time, we see mid-teens or higher household penetration as we continue to build brand awareness and broaden our product portfolio to increase the number of consumer-relevant categories where we show up. Our marketing approach encompasses a comprehensive omni-channel strategy from top-of-the-funnel awareness efforts down through purchase and repeat. Key elements include national television advertising, influencer partnerships, social media engagement, retail media, strategic sponsorships, and of course, compelling in-store and digital shelf positioning with the best retailers in every corner of the country.

What’s particularly noteworthy is that even while growing our penetration by more than 42% in 2025, where we added approximately 2.2 million new households, our buy rate among households with children increased by nearly 7% to a robust $47.20. Generally, when brands add new households at this fast a pace, you expect to see dilution in buy rate as they attract lots of lighter and more infrequent users, but we are seeing the opposite. We are obviously attracting the right brand-fit households, and additionally, more of them are buying us across multiple categories, which is our goal as we grow. Our direct-to-consumer channel also continues to serve as a valuable data collection and relationship-building platform, providing critical insights that inform our product development and marketing strategies.

Regarding deepening and expanding our reach with retailers, our second strategic pillar, we are seeing strong results across both existing and new partnerships. We’ve achieved 69% ACV distribution, spanning more than 25,000 locations across 6 product categories, with an average SKU count exceeding 20 per door in US MULO channels. Our top-tier retail partners carry 30-60 SKUs with continued growth trajectory. Baby coolers are an important cornerstone of our retail strategy, but they are only part of it. Coolers in a baby aisle serve as a key point of entry into the brand for new households.

We are rapidly expanding this program, including 62% growth in 2025 to over 3,400 units installed. The economics are compelling, with each cooler generating approximately $12,000 in run rate average annual retail sales and our investment contribution ranging from $3,000-$8,000 per unit, depending on the size of the cooler, retail terms, and anticipated productivity. This expense varies on our P&L, but is typically recognized in our trade spend or sales expense, with minimal spend hitting our CapEx. Coolers are treated as a period expense, and when reflected in trade spend, our net sales and profitability are depressed by such in the period the cooler is installed. For retailers, coolers are a clear winner.

They drive a 1.8x lift in overall baby department basket size, creating incremental value for our retail partners as they see higher share and more frequent trips down the aisle that lift the entire aisle. Because of these attractive consumer dynamics, we are either expanding, are in test and about to expand, or about to go into tests with almost every significant grocery retailer in the U.S., with lots of opportunity to expand. We see potential to scale this program to over 15,000 coolers in North America over time. This represents the number of stores where our cooler strategy is viable today and where a cooler would work well right now if we got it in, not just a future projection. Of course, it will take time to build toward this potential.

Given our confidence and years of experience in coolers, we are prioritizing speed to market while ensuring we partner with the right retailers and right stores within their footprints to expand this part of our business as fast as we can while executing with precision. Our third strategic pillar, continuing innovation-led category disruption, underscores how our innovation pipeline consistently delivers impressive market performance and drives valuable cross-category shopping behavior. Since 2023, we’ve introduced more than 40 new products from new product lines, all of which captured significant share within a short period of time. For example, we introduced dry baby snacks in 2024, and within six months, we had achieved top three performance within the category according to SPINS’s US MULO data. Last week, we announced the latest wave of all USDA-certified organic innovation that will be hitting store shelves beginning in April.

Our meat and bone broth, and legume blends mark the next evolution of Once Upon a Farm’s signature pouches. These are the brand’s first-ever refrigerated, organic, cold-pressure protected, protein-forward pouches for babies. We are targeting these products for placement in all our existing and future baby coolers over the coming quarters. We expect these pouches to be highly incremental to our existing assortment, and they should be a driver of continued cooler productivity growth in the years ahead. Further advancing our innovation in the pouch category, we’re also introducing smoothies with protein and probiotics, offering 4 grams of protein and added probiotics to help support immune health of older kids. These products will be focused on kid dairy sets where we sit nationally in retail.

Finally, we launched Power Wheels, a soft and chewy fun-sized fuel made with four grams of protein, 100% whole grain oats, and real fruits and veggie ingredients created with older active kids in mind. Power Wheels builds on the success of Tractor Wheels with an aged-up version that extends our Wheel franchise and expands our retail brand block and presence in kid bar sets nationally, an area of significant growth opportunity for our brands. Our final strategic pillar, driving sustained profitable growth, encompasses a broad range of operational excellence initiatives that have already delivered meaningful margin expansion and cost optimization. For example, gross margin was 42.3% in 2025 and has improved 305 basis points over the past three years.

Our optimization efforts have delivered over $25 million in annual savings and include reducing final mile delivery costs by more than 35% over the last 3 years while maintaining our customer-first experience. Going forward, we will continue to focus on high ROI investments in our supply chain, systems, and business capabilities to drive further margin expansion potential from our portfolio. We’ve also made strategic investments in best-in-class talent, implemented strategic revenue and sales management principles, and built scalable information technology systems to support profitable growth. Our Follow the Harvest global procurement network enhances both quality and cost efficiency while ensuring supply chain resiliency. We’ve developed a scalable production platform with partners who share our commitment to quality and have invested alongside us to support our growth, positioning us well to consistently deliver premium products while ensuring profitability and sustainability.

These four strategic pillars work synergistically to position us for sustained profitable growth while staying true to our mission of transforming childhood nutrition. As we look ahead to the opportunities before us, we’re excited about our ability to continue creating positive change in childhood nutrition while delivering value to our shareholders and stakeholders alike. Our strong foundation and mission, business operations, brand building, innovation and supply chain excellence positions us well for continued growth and success as a public company. We believe our products and mission are more important and relevant than ever, given the widely recognized societal challenges around the health of our children, and we’re committed to being part of the solution. Now I’ll turn the call over to Larry to cover the financial details and our updated outlook.

Larry Waldman, President and Chief Financial Officer, Once Upon a Farm: Thank you, John, and good afternoon, everyone. I will now provide you with some additional details on the fourth quarter and full year 2025 financial results, along with our outlook for 2026. Net sales in the fourth quarter increased 30.1% to $64 million, driven by relatively balanced volume and price mix growth. Importantly, consumption growth exceeded our reported sales growth by over 300 basis points, reflecting our strong brand momentum. Buy rate also continued to trend upwards and our repeat rate increased 480 basis points versus the prior year period to 50.5%. Looking at fourth quarter net sales by product. Kids sales increased 11.5% to $34.7 million, driven by 9.8% growth in pouches and 25.8% growth in snacks.

Baby sales increased 62.2% to $29.3 million, driven by 35.8% growth in pouches and 91.3% growth in snacks. Gross margin for the fourth quarter was 47.7%, up 105 basis points versus the prior year period. The increase in gross margin was driven by lower trade spend and higher average selling prices. SG&A expenses as a percent of net sales for the fourth quarter decreased by 318 basis points versus the prior year period to 40.7%, primarily due to lower marketing, logistics, and G&A expenses as a percent of net sales, partially offset by higher selling expenses. Net income for the fourth quarter was $22.5 million, compared to a net loss of $12.3 million in the prior year period.

The change in fair value of a derivative liability accounted for over $30 million of the year-over-year improvement in net income, with the balance of the increase due to higher gross profit, partially offset by higher G&A expenses. Adjusted EBITDA for the fourth quarter was $6.6 million, compared to $2.2 million in the prior year period. Briefly touching on full year 2025 results. Net sales increased 53.5% to $240.7 million, driven primarily by 42% volume growth, reflecting both incremental distribution of existing products and new product introductions.

Gross margin for 2025 was 42.3%, down 125 basis points versus the prior year due to increased planned trade spend as a percent of net sales, reflecting slotting fees related to expansion to new stores and placement of coolers. Cost of goods was unfavorably impacted by sales mix. SG&A expenses as a percent of net sales in 2025 decreased by 291 basis points versus the prior year to 44.7%. This improvement was primarily driven by strong revenue growth and disciplined cost management, which allowed us to leverage expenses more efficiently across a larger sales base. We reported a net loss of $17.2 million for 2025, compared to a net loss of $23.8 million in the prior year.

Adjusted EBITDA was $2.1 million for 2025, compared to a loss of $3.7 million in the prior year. Turning to our balance sheet. As of December 31, 2025, prior to the completion of our initial public offering, we had cash and cash equivalents of $10.9 million and total debt of $60.2 million, comprised of $43 million on a revolving credit facility and $17 million of convertible notes. Subsequent to year-end, we completed our IPO in February, resulting in total net proceeds to the company of approximately $139 million. A portion of our net proceeds was used to repay outstanding borrowings under our revolving credit facility. 2026 outlook. We are confident in our outlook for 2026, as we will continue to execute our long-standing plans.

2026 will see strong marketing, continued TDP growth on our powerful, best-selling core product lines, exciting and incremental innovation in both baby and kid, and disciplined execution against our strategic goals. Our financial position is strong, and today we have cash and cash equivalents of approximately $102 million, plus $82 million in borrowing availability, and currently no debt. In terms of specific guidance, we expect the business to deliver the following in 2026. On the top line, we expect growth of 25%-29% versus 2025, reflecting net sales of $302 million-$310 million, driven by innovation, expanded distribution, and further development across retail and club channels.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: We expect Adjusted EBITDA to be just above breakeven at $2 million-$4 million, reflecting our continued prioritization of investing in talent and infrastructure over the near term to support future growth. We are building capabilities with a strong emphasis on supply chain efficiency, productivity, and disciplined marketing investment. As we scale, we expect to reach a mid-teens% Adjusted EBITDA margin over the medium term, with our near-term investments setting up for the long-term success. This concludes our prepared remarks. Operator, please open the call for questions.

Reed Anderson, Moderator, ICR: We will now begin the question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. To ensure we have enough time to get to everyone in the queue, we ask that you please limit yourself to one question initially and then reenter the queue for any additional questions. Please stand by while we compile the Q&A roster. Our first question is from Leah Jordan with Goldman Sachs. Please proceed.

Leah Jordan, Analyst, Goldman Sachs: Thank you. Good afternoon, and congrats, John and Larry, on your nice first quarter out.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: Thank you.

Leah Jordan, Analyst, Goldman Sachs: I first wanted to ask on the sales guidance for 2026, seeing if you could provide more detail on how you’re thinking about the drivers between price and volume as well as any color by category as we move throughout the year.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: Yeah. Most of the growth is gonna be volume driven as just a general theme. We built the plan with, you know, clear plans and expectations around distribution growth on our existing items, expectations for innovation, marketing effectiveness, including, you know, a surge in awareness that we’ve gotten coming out of the IPO and just distribution wins and timing, and we feel real confident in the range that we’ve provided and hopefully have the opportunity to do better than that over time.

Leah Jordan, Analyst, Goldman Sachs: Okay, that’s helpful. I just wanted to follow up on the competitive environment. You know, how do you view your price gap today? You know, how would you characterize the overall promotional activity you’re seeing out there, and how is that influencing your own kind of brand investments and marketing as you plan for the year?

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: Yeah, broadly speaking, we haven’t seen any significant change in the promotional cadence or depth across our categories over the last year. There are some exceptions in certain places, but as a general rule, that’s been the case. We are priced very competitively relative to the value we’re providing for consumers and that they see. You know, we’re definitely a premium product, but consumers see a lot of value in it, and we feel like our price gaps are in a really good spot. We aggressively use Price Pack Architecture to drive our AUPs down to make sure we’re broadly accessible across the channels and retailers that we compete in. We watch our cohorts of consumers very closely, you know, across income brackets. For example, this brand over-indexes obviously in upper third income households.

For middle and lower third income households, we index right to the category, and we’ve seen really no significant shifts in our demand or velocity trends across any of those three, with respect to potential, like, uncertainty or competitive issues or price gaps in the marketplace or weakness in economic outlook and the like. We feel like we’re really well positioned, given what we offer and where we are in our competitive positioning in the marketplace.

Leah Jordan, Analyst, Goldman Sachs: That’s very helpful. Thank you. I’ll pass it on.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: Thank you, Leah.

Reed Anderson, Moderator, ICR: Our next question is from Thomas Palmer with J.P. Morgan. Please proceed.

David Palmer, Analyst, Evercore ISI2: Hi. Thanks for the question. I wanted to just ask on the guidance range. Appreciate that sales is probably the key driver here, but when we think about key swing items in EBITDA, are there costs or spending decisions we should keep in mind for 2026?

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: We have some costs that just keep in mind. One of it is that we are looking to continue to drive top-line sales, and we’re looking to invest in top-line sales. What we’re looking is and potentially adding cost into marketing on top top of the funnel marketing be able to drive not only for 2026 but also to drive us into 2027. The other thing is looking at is really cooler spend. We’ve built in you know a set number of coolers for the years. We’re looking to get up about 5,000 coolers in 2026. We’ve had significant conversations with all of our major customers. They are looking to accelerate coolers, and if the acceleration happens in 2026, that could add to the cooler spend that we have.

That would affect net sales, and it would affect EBITDA.

David Palmer, Analyst, Evercore ISI2: Great. Thank you.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: You bet. Thanks. Thanks, Tom.

Reed Anderson, Moderator, ICR: Our next question is from Jon Andersen with William Blair. Please proceed.

Jon Andersen, Analyst, William Blair: Hi. Good afternoon. Thanks for the question. My question is kind of bigger picture around competition. Are you facing any new competition at any of your key accounts, larger customers? You know, if so, how are you seeing the Once Upon a Farm brand perform in that setting? If I can just ask a follow-up.

Larry Waldman, President and Chief Financial Officer, Once Upon a Farm: With regard to coolers, can you just remind us how you, as you roll out more coolers during the course of 2026 and 2027, do you typically get the vast majority of the space in those coolers? Do you have kind of multi-year commitments from your key accounts to preserve that space? Thank you.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: Yeah. Thank you, John. We have a long history of competing effectively in our space. We’ve been in the kid dairy set for a long time. It’s a very competitive space. The only significant change in competitive set over the last year or so has been a new entrant that came in into a big mass account of ours, into our section. In about September of 2025, we’ve been going head-to-head there for about six months. As you could expect, they came in pretty aggressively and have done over 50% of their volume on deal since the beginning, plus marketing investments and customer support, including, you know, retailer-supported display at launch. Despite all that, our average dollar velocity per week on our items is two times better than that competitor.

Our repeat rate is 1.8 times better than that competitor, and their best-selling pouch after 6 months is selling at the rate of our number 12 item. We feel like we’re competing very effectively and that we’ll continue to do that, and we credit that to really strong loyalty with our consumers, a very strong brand, and a strong team that knows how to compete when we need to. After we saw an initial volume hit from that entrance, we’ve seen growth sequentially growing again there. We’re really optimistic about our outlook there. On coolers, we have. We generally do have a multi-year agreements in place. It varies by retailer. We generally will have most of the space in the cooler, but not all of it by design.

Our short-term and long-term view is that if we’re the highest velocity product in those coolers, we’ll tend to have most or all the space over time, and that’s our primary focus.

Larry Waldman, President and Chief Financial Officer, Once Upon a Farm: Great. Thank you.

Reed Anderson, Moderator, ICR: Our next question is from Peter Galbo with Bank of America. Please proceed.

Peter Galbo, Analyst, Bank of America: Hey, guys. Good morning. Oh, good afternoon. Jeez. Thanks for the questions. John, I wanted to discuss a little bit on the protein offerings, or the animal protein offerings, the new ones that you announced at Expo West. I’d love to get a little bit more detail. It’s obviously a different form factor, a different product. I mean, potentially a different supply chain. So just any additional detail. Do you need you know new equipment in the co-manufacturers? Did you need to go acquire new co-mans in order to be able to process, just given it’s different than kind of what your core product is. So appreciate any detail there. Thanks very much.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: Yeah, certainly. One of the key consumer requests that we’ve gotten for a long time, just like every other consumer packaged goods company in America, is for more protein and better protein. We’ve had this in our innovation pipeline for a very long time. We did have to set up a new supply chain for it, sourcing very high quality or organic meats for all these products. It’s using our existing manufacturing capacity and strong partnerships. What we’re really excited about is we’ve seen a real clear, you know, demand for our consumers for these fresh positioned, organic products. This is a really, really good subcategory in baby. It’s about $185 million in retail scanning data across Nielsen, growing at 9%.

It’s a very healthy category with good brands there, and we feel really strong that we’re gonna be able to bring these products into coolers, serve an incremental need to our existing consumers who are looking for that product and really drive overall category growth. We think, I mean, it’s possible we could bring some share from these other brands that are there, but I think the vast majority of what we’re gonna do is we’re gonna drive the category with incremental growth, just like we have every time we’ve come in. We feel really good about that. Larry, is there anything you wanna add on the supply chain side?

Larry Waldman, President and Chief Financial Officer, Once Upon a Farm: No. I mean, on the supply chain, a lot of supply chain was pulled off our existing supply chain, but we did have to build a new supply chain for the proteins that we’re actually using and be able to source that work within our manufacturing. We did build our specific line for this because we did not wanna run it with our fruit and vegetable pouches. But it’s being produced by our existing manufacturers and we have all the relationships and everything else that we have on that. It carries over from our existing core business to this new line of product.

Peter Galbo, Analyst, Bank of America: Okay, great. Thanks.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: Thanks. Thanks, Peter.

Reed Anderson, Moderator, ICR: Our next question comes from David Palmer with Evercore ISI. Please proceed.

David Palmer, Analyst, Evercore ISI: Thanks. Congrats on the quarter, and thanks for the color so far. You know, you sounded confident on your commentary on the cooler rollouts, talking about the discussions with virtually every retailer. I’m wondering if you can maybe give us some more color about your assumptions for cooler rollouts in 2026 and how much of a contribution you’ve baked in in terms of your sales guidance for that year. If you’re continuing to think that whatever the ramp-up in cooler placement is in 2026, that you’re gonna be ramping up even more into 2027, or if perhaps you’re, you know, pulling back, you think you’re pulling some of 2027 into 2026. Just any color on all this would be helpful. Thank you.

Larry Waldman, President and Chief Financial Officer, Once Upon a Farm: Yeah. We’ve built into our existing forecast the goal to 5,000 or slightly above 5,000 in coolers in 2026. There are opportunities for us to be able to expand faster in 2026, and that would pull some of the coolers in from 2027. A lot of the growth that we’re looking in 2026 is really new customers, new retailers that we haven’t built within our modeling in either 2026 or 2027.

We’ve had some great discussions with these additional retailers, and so we’re looking at that as, yes, some of it could be pulled through acceleration with existing retailers, but we’re seeing a lot of opportunity in 2026 and in 2027 to be able to bring in new retailers that we’re in discussions with right now that haven’t been put in, that hasn’t been put into the modeling right now.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: Yeah. What I’d add, David, is like, the way it generally works on coolers is on every retailer, almost every retailer tests first, right? We’ll design a relatively small test. It could be 2 stores, it could be 5, it could be 25, whatever the appropriate store count is. We’ll get that test going. Generally, those tests do relatively well or really well, depends on how the execution goes. Then the conversation becomes how fast they can expand. What we have noticed as a general trend over the last couple years, especially the last year, remember, we’ve been doing coolers now for multiple years and learning as we’ve been going, is that the tests are performing bigger and better, and the retailer ambition to go aggressive and fast is growing. We feel that.

As I mentioned in the opening comments, you know, we wanna go as fast as we possibly can against the coolers, the retailers, the store locations that we know are gonna be successful based on the model that we have. I mentioned in my opening comments that there’s 15,000 doors out there. If you put a cooler in tomorrow, and it was the right cooler with our assortment in it, we know it would work. We know it would deliver for the retailer what we talked about in terms of the total category lift, impact on frequency down the aisle, just all these good things that retailers love. Now, that is what retailers are seeing broadly. They’re seeing competitors do it. They’re seeing competitors have success with it. We’re seeing a lot of positive momentum there.

We’ll go as fast as we possibly can as long as we can execute with high perfection.

Larry Waldman, President and Chief Financial Officer, Once Upon a Farm: Yeah. What we’re looking at when we talk about it’s not, we’re not pulling 27 into 26. What we’re looking at is accelerating the move towards the 15,000 coolers that we believe would be in.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: That’s our objective and what we think can happen.

David Palmer, Analyst, Evercore ISI: Great. Thank you.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: Thank you, David.

Reed Anderson, Moderator, ICR: Our next question is from Andrew Lazar with Barclays. Please proceed.

David Palmer, Analyst, Evercore ISI: Great. Thanks a lot. Good evening, everybody. Two things. One, any commentary around just discrete things we should keep in mind around sort of cadence of how the year plays out, both on the top line and on EBITDA, if there are things just to call out there from a modeling standpoint? Then, I know there are some opportunities that you might have as you talked about to go faster that might justify some incremental investment this year. I’m wondering where there might be some other areas where perhaps you’ve built in some conservatism into the model, maybe around whether it be around productivity and what’s built in there, or where you might have some opportunities to help fund some of that incremental investment should it, you know, should those opportunities arise. Thanks so much.

Larry Waldman, President and Chief Financial Officer, Once Upon a Farm: Yeah. On the phasing of how the year flows, I mean, the way we look at it is that, you know, we have a big lift, and we usually have a big lift in the second quarter associated with some promotions. What we have is we have a lot of resets in the second quarter that drive getting to market with the new distribution. We also have back to school in Q3. That is a big promotional period for us. Then what you’ll see is Q4 usually is flat to Q3 coming out. We run less promotion during the year, so the top line gross sales slightly lower. But when you look at net sales, it’s usually flat between Q3 and Q4.

That’s kind of the cadence. The things that could throw that off would be promotions, you know, working with Costco and Club on other promotions that may not be committed at this point and may not be built in the model. The phasing of coolers and when the coolers actually hit and go live with the customer. That, you know, we have an idea of when the coolers are gonna be coming in based upon our conversations with our customers, but it does somewhat push out or pull in based upon what the timing is for that customer, and that changes usually within two to three months of when the cooler actually hits the stores.

On the areas where we can drive productivity, the real thing, and we talked about this on other calls, is that we have a lot of projects of what we’re trying to build to drive efficiency within our manufacturing base. So we have a lot of them. They’re currently in place. We’re working to get them up and running. As we said before, we did not build those into our model because we don’t know when they’re actually gonna hit and then the level of productivity is, and when we’re gonna start seeing that productivity coming in.

We have a lot of opportunities within our gross margin and within our COGS, as we drive those productivity projects and as they get online. That is really where we were conservative within the model because we did not build. We just carried over the productivity programs that we built in prior years. We didn’t build any new productivity into the model going forward because we just wanted to make sure we had a better feel of what those projects would deliver and the timing of those projects when they start hitting the P&L.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: Thanks so much.

Larry Waldman, President and Chief Financial Officer, Once Upon a Farm: You bet.

Reed Anderson, Moderator, ICR: Our next question is from Stephen Powers with Deutsche Bank. Please proceed.

David Palmer, Analyst, Evercore ISI1: Great. Thanks so much, John, Larry. Good afternoon.

Larry Waldman, President and Chief Financial Officer, Once Upon a Farm: Great.

David Palmer, Analyst, Evercore ISI1: Two things for me too, if possible. One, I was just hoping, maybe to start, you could compare and contrast the volume growth, the volume-led growth, outlook that you mentioned, John, for 2026, just versus the more balanced volume versus price mix dynamics we saw in the fourth quarter here. Maybe just dig a little bit into the drivers and call out any kind of known variations in volume versus price as we kind of roll through the year, maybe building on Larry’s cadence commentary that he just went through in response to Andrew’s question. The second question I had was, just around cost structure sensitivity to higher oil, natural gas, and energy costs, just as those variables are, obviously top of mind for the market today, generally. Thanks.

Larry Waldman, President and Chief Financial Officer, Once Upon a Farm: Most of our growth will be in volume for 2026, and it’s being driven by the new innovation, all the TDP growth that we have. You’ll see some price when we do future reporting, also being there, but that’s really driven by customer mix and our move into Price Pack Architecture. You’ll see that because when we move into bigger pack sizes, the average cost per AUP per unit actually goes down because they’re buying a larger amount within that larger pack size. Even though it’s a volume-related growth, but you’ll see that there’s volume-related growth driven by price.

On the second question on the oil, you know, we do source from all over the world. We do bring product in, and so we do look at the cost of most of the products are coming in by ship, although that’s the most efficient way and the lowest cost. You know, oil still has an impact on that cost coming into the States for those items. Most of our product, whether it’s domestic or international, comes in by truck. What we’re seeing is because we negotiated and we’ve contracted for all the base freight rates, but we’ll see higher surcharges coming into us as we have those products coming in.

We’re not anticipating that to be a material impact to us. For right now, it’s going to be. We’ve kind of modeled it in. It’s less than 100 basis points. You know, and that’s where if it continues to play out for the whole year, so we’re thinking that it’s immaterial at this point, just based on how our mix of materials go through and how we deliver our products directly to our customers. It is an impact, but we’re looking at it being immaterial.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: Yeah. I’d also just add, we have, you know, flexibility. We have strategic revenue management projects that are ongoing with opportunities to pick up there, and we have the opportunity to do things from a pricing standpoint if we needed to. We do not anticipate that right now. But we have levers to pull to make sure that we can deliver against what we’re saying.

David Palmer, Analyst, Evercore ISI1: Okay, great. Thanks so much.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: Thank you, Stephen.

Reed Anderson, Moderator, ICR: Our next question is from Rupesh Parikh with Oppenheimer & Co. Please proceed.

David Palmer, Analyst, Evercore ISI0: Good afternoon, and thanks for taking my question. Just with the IPO and all the awareness that you guys have generated so far, just curious, you know, how that’s played out, you know, based on what you’re seeing in the business and maybe on the retailer side as well.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: Yeah. Our engagement on the brand from a retailer perspective has always been strong. We’ve built very strong relationships top to top at these big chains all the way down through the category managers and buyers and the like. I’d say it’s pretty clear that our business credibility inside those chains has only accelerated as a result of the IPO, which we would have anticipated. There’s no question that we generated an incredible surge in awareness for the brand coming out of the IPO. We’ve been able to see that in a lot of different metrics that we track across the business. We’ll see how that plays out over time.

You know, awareness is definitely a leading indicator to household penetration, and we expect it’s certainly gonna help us drive continued growth in awareness in the trial and repeat and household penetration for the brand as part of our broader marketing plans. I’d say in addition to the IPO, we have very strong marketing plans in place this year. Robust top-of-funnel support all the way down, continuing through the entire year, built on all of the learning and great marketing that we did in 2025 to drive those results. We’re feeling really optimistic about our ability to build the audience that’s following this brand and buying us, hopefully in multiple categories over time.

David Palmer, Analyst, Evercore ISI0: Great. Thank you.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: You bet.

Reed Anderson, Moderator, ICR: Our next question is from Robert Moskow with TD Cowen. Please proceed.

Robert Moskow, Analyst, TD Cowen: Hey, thanks, and congratulations again, John and Larry. I wanted to know if there’s any way to kind of dimensionalize your distribution growth assumption, as it relates specifically to coolers. You know, you put up a big number here, but you’re also talking about, I guess just distribution from new products as well. So, like, maybe the right way to ask is, of this, like, 26% growth or so for the year, is the majority of that coming from distribution? Is it just half? And can I correlate that directly to the new coolers or something else?

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: The biggest driver in growth for the year is gonna be distribution expansion across our existing best-selling items, including coolers, right? But broadly speaking, it’s really everything. It’s from our core assortment in kid dairy. It’s obviously from our snacking business in baby aisle, but coolers is growing as well from around 3,400 now to a little over 5,000, as Larry talked about. That’s. Does that help?

Robert Moskow, Analyst, TD Cowen: Yeah. I’ll follow up. A follow-up to the question is, you know, your gross margin is down in 2025, and you’ve been very transparent that there’s slotting fees related to that associated with the coolers. Are we still on track to be down, you know, 120 basis points this year? Is it the same driver for that decline, the slotting fees?

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: Yeah, Robert, we’re projecting to be slightly down from 25, about 120 basis points. The driver of that is coolers. We’re projecting higher cooler slotting than 25, but we’re also building in about 100 basis points of tariff costs during the year. Between the both of those, that’s what’s impacting margin right now.

Robert Moskow, Analyst, TD Cowen: Great. Thank you.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: You bet. Thank you, Rob.

Reed Anderson, Moderator, ICR: There are no further questions at this time. I would like to turn the floor back over to John for closing remarks.

John Foraker, Chief Executive Officer and Co-founder, Once Upon a Farm: Great. Thank you very much, everyone, for dialing in today. I wanna thank all our incredible OFR and team members for their hard work and dedication every day in pursuit of our mission and to build the best brand and business possible. You know, everything that you’ve done over many years to prepare us to perform on this very public stage and to continue to execute at a very high level, much appreciated. We’re proud of the strong fourth quarter performance, which reflects the powerful underlying momentum around the brand and ongoing trust consumers place in our mission-driven approach. Our successful IPO was a major milestone that will serve as a launching pad for further acceleration of our growth initiatives. We’ll continue to delight consumers, drive strong win-win retail partnerships, and deliver against our mission to improve childhood nutrition for all kids everywhere.

Parents today are more committed than ever to providing their children with the highest quality organic nutrition, and Once Upon a Farm is uniquely positioned to capitalize on this demand to drive sustained growth in 2026 and beyond, as well as value for all of our shareholders and stakeholders. Thank you very much for your time today.

Reed Anderson, Moderator, ICR: Thank you. This will conclude today’s conference. You may disconnect at this time, and thank you for your participation.