10-Q · November 6, 2025
Farmer Bros. reported net sales of $81,601,000 and a net loss of $(4,025,000) (EPS $(0.19)) for the three months ended September 30, 2025. Revenue and gross profit declined YoY while gross margin compressed to 39.8% and…
Earnings analysis · 10-Q
FARM earnings analysis
Filed February 13, 2026 · Our reading of the company's report
The latest report
Farmer Bros. reported quarterly net sales of $88.923 million and GAAP diluted EPS of $(0.22), driven by a $32.267 million gross profit but a $(4.136) million operating loss. YoY revenue and gross profit declined while…
Read full summary
Farmer Bros. reported quarterly net sales of $88.923 million and GAAP diluted EPS of $(0.22), driven by a $32.267 million gross profit but a $(4.136) million operating loss. YoY revenue and gross profit declined while leverage increased (revolver borrowings rose to $21.3 million) and operating cash flow remained negative for the six months ended December 31, 2025. Liquidity and covenant-trigger risk are the primary near-term concerns.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $-0.22
What stood out
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Revenue roughly stable year-over-year
Net sales were $88,923,000 for the quarter versus $90,021,000 in the prior-year quarter (a decline of $1,098,000), showing only a modest YoY change as reported in the consolidated statements of operations.
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Gross profit remains positive
Gross profit of $32,267,000 was reported (cost of goods sold $56,656,000), leaving gross dollars to absorb SG&A despite a YoY decline from $38,839,000 in the prior-year quarter (down $6,572,000).
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Operating loss and EPS miss
Loss from operations was $(4,136,000) (versus income from operations $1,018,000 in the prior-year quarter) and diluted GAAP EPS was $(0.22) compared with $0.01 in the prior-year quarter.
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Increased revolver borrowings provide near-term liquidity
Long-term borrowings under the revolving credit facility increased to $21,300,000 as of December 31, 2025 from $14,300,000 at June 30, 2025; net cash provided by financing activities for the six months was $6,895,000 (reflecting $7,000,000 proceeds).
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Working capital broadly stable
Accounts receivable, net was $25,527,000 (up $769,000 from $24,758,000 at June 30, 2025) and inventories were $49,395,000 (down $444,000 from $49,839,000 at June 30, 2025), per the balance sheet.
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Balance sheet equity decline
Total stockholders' equity decreased to $35,658,000 at December 31, 2025 from $43,548,000 at June 30, 2025 (a decline of $7,890,000); accumulated deficit increased to $(53,761,000) from $(44,870,000).
What to watch
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Negative operating cash flow
Net cash used in operating activities was $(5,793,000) for the six months ended December 31, 2025 (versus $5,046,000 provided in the prior-year six months), indicating weakened operating cash generation.
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Low unrestricted cash and higher revolver borrowings
Unrestricted cash and cash equivalents were $4,186,000 at December 31, 2025 (down from $6,796,000 at June 30, 2025) while revolver borrowings totaled $21,300,000, increasing short-term liquidity pressure.
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Covenant sensitivity on revolver availability
The Revolver Agreements require that if availability falls below $9,375,000 the Company must maintain a fixed charge coverage ratio of at least 1.00:1.00 — with cash of $4,186,000 and $21,300,000 drawn on the revolver at Dec 31, 2025, availability could be constrained.
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Profitability deterioration
Cost of goods sold rose to $56,656,000 while gross profit declined to $32,267,000, producing an operating loss of $(4,136,000) and a net loss of $(4,866,000) for the quarter, all worse versus the prior-year quarter as shown in the statements of operations.
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Equity cushion shrinking
Total stockholders' equity fell to $35,658,000 at December 31, 2025 from $43,548,000 at June 30, 2025 and accumulated deficit widened to $(53,761,000), reducing financial flexibility.
Management's outlook
The Form 10-Q does not provide explicit numeric forward guidance. MD&A statements in this filing do not include quantitative 'expects' or 'anticipates' targets; outlook appears deferred to other communications (press release/earnings call).
Earlier filings 4
10-K · September 11, 2025
Farmer Bros. presents a one-segment coffee, tea and allied-products business focused on growth via its nationwide DSD network, manufacturing/network optimization and sustainability programs (Project D.I.R.E.C.T.®…
10-Q · May 8, 2025
Farmer Bros. reported Q3 net sales of $82,054 (thousands), down from $85,358 in the prior-year quarter, and delivered a diluted loss per share of $(0.23) versus $(0.03) a year earlier. Gross profit was modestly higher…
10-Q · February 6, 2025
Farmer Bros. reported net sales of $90,021,000 and diluted EPS of $0.01 for the three months ended December 31, 2024. Gross profit improved to $38,839,000 (43.1% margin) versus the prior-year quarter, but operating…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.