Edible Garden (NASDAQ:EDBL) used its fourth-quarter and full-year 2025 earnings call to outline an ongoing shift from its controlled environment agriculture (CEA) roots toward a broader consumer packaged goods (CPG) portfolio and an expansion into ready-to-drink (RTD) beverages. Chief Executive Officer Jim Kras said 2025 was a “defining year” as the company pursued “higher growth, higher margin opportunities” aligned with retailer and consumer demand.
Retail expansion and category momentum
Kras said Edible Garden continued to add distribution and strengthen relationships with national and regional retailers during the fourth quarter, citing new and expanded placements with Kroger, Weis Markets, Safeway, The Fresh Market, and Busch’s. He said the company’s distribution increased to nearly 6,000 store locations, including more than 700 incremental locations tied to customer onboarding efforts.
Kras also described an expanding lineup of “Better for You” brands, naming KICK Sports Nutrition, Jellyci GLP-I, Vitamin Way, Pickle Party, and Pulp, along with broader distribution across domestic, e-commerce, and international channels. He cited placements with Amazon, PriceSmart, target.com, and walmart.com.
Strategic focus shifts toward ready-to-drink beverages
Management emphasized that the company’s push into RTD is intended as an evolution rather than a departure from its fresh produce base. “This is not a shift away from what we’ve built,” Kras said, describing the strategy as leveraging Edible Garden’s retail footprint and infrastructure to scale into “higher value categories,” including shelf-stable and RTD products.
Kras said the company is developing a RTD manufacturing initiative at its Midwest facility as part of its “Zero-Waste Inspired platform,” and has selected Tetra Tech “to plan, install, and integrate proprietary processing capabilities.” He argued the company is positioned to enter RTD with existing distribution across approximately 6,000 store locations, enabling deeper retailer relationships as it moves into a new category.
During the Q&A, Kras said Edible Garden expects to focus “primarily in the protein segment” of RTD. He also said the company was asked by a “major retailer” to help develop RTD offerings for private label as an initial step. Kras added that the company plans to produce products under its own brands, including KICK and a GLP-1 supportive formula under the “Jealousy” brand, while also taking on co-manufacturing opportunities and private label volume. He said he expects “half of the facility” to be private label.
Kras declined to provide specific capital expenditure figures, but described the project as requiring “some real CapEx,” including equipment purchases and retrofitting a building. He said Edible Garden is working with local and state authorities on incentives and has “gotten the nod on a few things.” He added that the company’s plan is to be “out in the marketplace…towards the tail end of 2027.”
Fourth-quarter financial results reflect onboarding costs
Interim Chief Financial Officer Kostas Dafoulas reported fourth-quarter revenue of approximately $4.1 million, up from $3.9 million in the prior-year period. He attributed momentum to business performance and customer wins, including the October launch of USDA organic herb programs with Kroger and the first international CPG shipment of KICK Sports Nutrition to PriceSmart.
However, Dafoulas said the quarter included elevated costs tied to onboarding large retail accounts in a “seasonally compressed period.” Cost of goods sold rose to approximately $5.3 million from $3.8 million a year earlier, resulting in a gross loss of about $1.2 million compared with roughly flat gross profit in 2024’s fourth quarter. Dafoulas characterized this as a deliberate investment to secure 2026 shelf space and build the performance record required by major retailers, adding that the company expects costs to normalize as programs mature and volumes increase.
Selling, general and administrative expenses increased to approximately $4.6 million from $2.6 million in the prior-year quarter. Dafoulas said primary drivers included depreciation and rent tied to the NaturalShrimp asset acquisition, higher legal and professional fees related to that acquisition and capital markets activity, and higher compensation expense. He noted a “meaningful portion” of the increase was non-recurring or deal-related rather than ongoing run-rate expense.
Full-year results shaped by product exits and acquisition-related expenses
For the full year, Dafoulas reported revenue of approximately $12.8 million versus $13.9 million in 2024. He said the decline was largely due to the company’s strategic exit from floral and lettuce, which together accounted for approximately $1 million of 2024 revenue but carried low margins. Excluding those exits, he said core revenue was essentially flat year over year, while fourth-quarter revenue increased about 5%.
Full-year cost of goods sold rose to approximately $13.0 million from $11.6 million, which Dafoulas said was concentrated in the second half and driven by the same onboarding dynamics seen in the fourth quarter. Full-year gross profit was a loss of approximately $0.2 million compared with a gain of $2.3 million in 2024. Dafoulas said the first half tracked closer to historical margins, and emphasized that the full-year result was heavily influenced by the fourth quarter. He said “gross margin recovery is a top priority for 2026” as new programs scale, third-party procurement costs decline, and fixed costs are absorbed over a larger revenue base.
Full-year SG&A expense was approximately $15.3 million compared with $11.6 million in 2024, driven primarily by the Natural Shrimp acquisition and capital markets activity, along with continued investment in personnel and infrastructure supporting the company’s longer-term strategy.
Outlook: margin mix and portfolio expectations
In response to an analyst question about margin expectations as Edible Garden adds shelf-stable CPG and RTD, Kras said the company expects “much more robust” and “more stable” margins in shelf-stable categories compared with fresh, citing reduced shrink risk and greater manufacturing control. He also pointed to service performance as a factor in retailer confidence, noting a “98% in-stock rate and acceptance rate” with major retailers.
Dafoulas provided a framework for how management views the portfolio, describing three components:
- Core CEA business: Dafoulas said he expects a return to “steady growth in the high single digits” range, with margins returning toward normalized levels seen earlier in 2025 and in 2024.
- Nutraceuticals: He said the segment showed “double-digit, 20%-ish” year-over-year growth, but noted that co-manufacturing can limit margin richness relative to in-house production.
- RTD: He described RTD as the “biggest upside,” citing early expectations for margins in the “20%-30% range,” while noting the company is still scoping the project and refining input cost assumptions.
Asked about the sustainability of recent distribution gains, Kras said he expects continued store count growth across the business, referencing ongoing opportunities in herbs, pickles, and RTD, including channels the company does not currently serve such as convenience stores.
In closing remarks, Kras reiterated that management views 2025 as a year of progress in building beyond Edible Garden’s CEA foundation into a broader CPG platform. He said the company believes the RTD expansion is a significant opportunity that leverages existing infrastructure, retail relationships, and product development capabilities, with the goal of scaling into markets where demand “continues to outpace supply.”
About Edible Garden (NASDAQ:EDBL)
Edible Garden AG, trading on the Nasdaq under the ticker EDBL, is a technology-enabled agriculture company specializing in the design, construction and operation of hydroponic greenhouse farms. By leveraging controlled-environment agriculture techniques and proprietary automation systems, the company produces a range of leafy greens and salad‐related vegetables, including branded Salanova products, for wholesale distribution to retailers, food service operators and distributors.
In addition to farm ownership and produce cultivation, Edible Garden develops and licenses its modular greenhouse technology and cultivation methods to third parties.
