Arcadia Biosciences, Inc.

Q1 2025 total revenue was approximately $1,200,000, up 22% year over year. Zola revenue increased 90% year over year, while revenue in Q1 2024 included $354,000 of GLA oil sales. Cost of revenues was approximately $680,000, up 45% year over year, and gross margin was 43% versus 52% in Q1 2024. SG&A was $1,700,000, down from $2,100,000 a year ago, and operating expenses were down 16% year over year, even including nearly $500,000 of transaction-related fees. Cash ended the quarter at $3,200,000 versus $4,200,000 at the start of the year. Management said it expects product revenue in 2025 to come entirely from Zola, gross margins to trend toward the low 30% range, losses from discontinued operations to remain low, and the $2,500,000 note receivable payment to be received in Q2.

T.J. Schaefer said the company had carried second-half 2024 momentum into 2025 and was pleased with the quarter, especially Zola’s 90% revenue growth and strong distribution gains. He emphasized new product innovation, a healthy pipeline of customer and distributor discussions, and the potential for additional placements to help drive 2025 results. He also framed the BioSeries transaction and the Roosevelt combination as steps toward simplifying the business, monetizing IP, and exiting legacy AgTech, while noting the deal timeline has slipped but still appears on track.

Mark Kawakami focused on the financial quality of the quarter: $1.2 million of revenue, 43% gross margin, and SG&A of $1.7 million, with nearly half a million dollars of those costs tied to the Roosevelt transaction. He highlighted that Q1 operating expenses were down 16% year over year and that there was no loss from discontinued operations this quarter, versus $1.5 million in Q1 2024. On the balance sheet, he noted $3.2 million of cash, $1.6 million of receivables, and $1.3 million of inventory, and said the company is using asset monetization and reduced spending to offset M&A-related cash use.

Analyst Ben Klieve asked about the size and timing of the Zola distribution pipeline, and management said it is roughly half of current distribution, or about 3,500 stores in the neighborhood, with recent new customer and distributor wins expected to affect 2025 results. He also asked about the remaining legacy tomato patent, and T.J. Schaefer said it may have commercial value for the licensee, who is reportedly about two years from commercialization, but not for Arcadia, which wants to remove the liability. On the $2.5 million note receivable payment, Mark Kawakami confirmed it is scheduled for receipt in Q2.