FitLife Brands (FTLF) Q2 2025 earnings summary

Executive summary

• Q2 2025 revenue declined 5% year-over-year to $16.1 million, mainly due to lower MRC sales, with online sales comprising 65% of total revenue and Legacy FitLife brands showing growth.

• Net income dropped to $1.7 million from $2.6 million, primarily due to elevated M&A expenses related to the Irwin Naturals acquisition, which closed post-quarter.

• Adjusted EBITDA for Q2 2025 was $3.3 million, down 13% year-over-year; trailing 12-month adjusted EBITDA reached $13.4 million.

• Gross margin declined to 42.8% from 44.8% year-over-year, reflecting product mix, promotional investments, and tariffs.

• The acquisition of Irwin Naturals for $42.5 million is expected to be transformative, with combined annual revenue projected to exceed $120 million and adjusted EBITDA between $20–$25 million.

Financial highlights

• Q2 2025 revenue: $16.1 million (down 5% YoY); six-month revenue: $32.1 million (down 4% YoY).

• Q2 2025 net income: $1.7 million (down 34% YoY); six-month net income: $3.8 million (down 21% YoY).

• Adjusted EBITDA for Q2 2025: $3.3 million; for six months: $6.7 million.

• Basic and diluted EPS were $0.19 and $0.18, down from $0.29 and $0.27 year-over-year.

• Ended the quarter with $6.6 million in cash and $10.9 million in term loans, resulting in net debt of $4.3 million (0.3x adjusted EBITDA).

Outlook and guidance

• Management is optimistic about achieving organic revenue growth in 2025, despite challenges with the Dr. Tobias brand.

• Combined gross margins for FitLife and Irwin are expected in the high 30% range, with potential for improvement as online sales increase and supply chain efficiencies are realized.

• Anticipates annual SG&A for Irwin to be $1.5 million lower post-acquisition, with further cost savings expected.

• No immediate plans for further M&A; focus is on integrating Irwin and addressing challenges at Mimi's Rock.

• Management believes current cash, operations, and credit lines are sufficient for liquidity over the next 12 months.