Natural food company Hain Celestial (NASDAQ:HAIN) reported Q3 CY2025 results beating Wall Street’s revenue expectations, but sales fell by 6.8% year on year to $367.9 million. Its non-GAAP loss of $0.08 per share was 48.1% below analysts’ consensus estimates.
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Hain Celestial (HAIN) Q3 CY2025 Highlights:
- Revenue: $367.9 million vs analyst estimates of $360.5 million (6.8% year-on-year decline, 2.1% beat)
- Adjusted EPS: -$0.08 vs analyst expectations of -$0.05 (48.1% miss)
- Adjusted EBITDA: $19.73 million vs analyst estimates of $19.81 million (5.4% margin, in line)
- Operating Margin: -1.9%, down from 2.1% in the same quarter last year
- Organic Revenue fell 6% year on year vs analyst estimates of 5.4% declines (61.1 basis point miss)
- Market Capitalization: $108.4 million
StockStory’s Take
Hain Celestial’s third quarter results received a positive market response despite ongoing year-over-year sales declines. Management attributed the improvement to sequential gains in organic net sales trends, particularly in North America, where Beverages, Baby and Kids, and Meal Prep segments all returned to growth, partially offsetting continued softness in Snacks. Interim CEO Alison Lewis emphasized that cost control measures, a revamped operating model, and targeted brand renovation initiatives are beginning to yield tangible benefits. Lewis noted, “We are already beginning to see results with an improvement in forecast accuracy, a reduction in inventory in North America and an acceleration in the innovation pipeline across the business.”
Looking ahead, Hain Celestial’s strategy centers on accelerating new product launches and executing cost-saving initiatives to improve margins and stabilize sales. Management expects a stronger performance in the second half of the year, anchored by their ‘5 actions to win’ plan, which includes portfolio simplification, revenue growth management, and digital marketing. CFO Lee Boyce stated, “We continue to expect aggressive cost cutting and execution against our ‘5 actions to win’ in the marketplace to drive stronger top and bottom line performance in the second half of the year.” The company also highlighted upcoming innovation in categories like Snacks and Baby and Kids, with a focus on premiumization and pricing to offset inflationary pressures.
Key Insights from Management’s Remarks
Management attributed third quarter performance to sequential improvements in core categories and the early impact of portfolio simplification and cost reduction programs.
- Sequential category improvement: Beverages, Baby and Kids, and Meal Prep returned to growth in North America, partially offsetting ongoing declines in the Snacks segment, which remains under turnaround plans.
- Portfolio simplification underway: The company executed its planned exit from the meat-free category in North America and targeted the elimination of approximately 30% of North American SKUs by 2027, aiming to focus resources on higher-margin, higher-growth categories.
- Cost discipline and SG&A reduction: Restructuring actions and operational changes led to an 8% reduction in selling, general, and administrative expenses year over year, with further cost initiatives expected to deliver over 12% reductions in people-related SG&A expenses.
- Innovation pipeline acceleration: Hain Celestial launched new products across its key brands, including a major relaunch of Garden Veggie Snacks (now made with avocado oil and new recipes), expanded single-serve offerings for Greek Gods yogurt, and new snack lines under Earth's Best targeting older children.
- Digital-first marketing and e-commerce: The shift to digital-first marketing models, such as CRM programs and partnerships with platforms like Ibotta, began to drive improved returns on advertising spend and supported e-commerce growth, especially in tea and yogurt.
Drivers of Future Performance
Management sees future performance hinging on innovation, cost reductions, and the success of pricing and trade initiatives across key brands.
- Product innovation and relaunches: The company is rolling out new and renovated products, particularly in Snacks and Baby and Kids, with the expectation that these launches will drive incremental sales and help regain market share in declining segments.
- Aggressive cost and margin actions: Ongoing restructuring and cost-cutting programs are expected to further reduce SG&A expenses and improve operating margins, with productivity savings targeted above $60 million for the year and additional benefits from overhead realignment.
- Pricing and channel strategy: Management is implementing strategic price increases and optimizing price pack architecture to balance value-seeking consumer trends with inflation recovery. Early results from Tea and Baby categories are promising, but continued competitive pressure and consumer caution remain risks.
Catalysts in Upcoming Quarters
In upcoming quarters, the StockStory team will be closely monitoring (1) the pace and impact of new product launches and relaunches in categories like Snacks and Baby and Kids, (2) the effectiveness of cost reduction and SG&A initiatives in supporting margin recovery, and (3) the execution of portfolio simplification, including SKU rationalization and exits from low-margin businesses. Progress on digital marketing and success in e-commerce channels will also be important markers of turnaround momentum.
Hain Celestial currently trades at $1.21, up from $1.07 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free for active Edge members).
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