Lifecore's Third-Quarter Revenue Decline Steepens

The Tip Desk · November 4, 2026 · 2 min read

Revenue was $25.3 million, down 18.6% from a year earlier, as the injectables CDMO booked a $40.1 million net loss.

Lifecore Biomedical, Inc. (LFCR), a fully integrated injectables contract development and manufacturing organization, reported third-quarter revenue of $25.3 million, down 18.6% from $31.1 million a year earlier. The year-over-year decline steepened from the second quarter’s 6.2% drop and followed a 34% decline in the first quarter. Sequential revenue fell $8.9 million from the second quarter’s $34.2 million.

Both reportable lines declined. CDMO revenue was $17.8 million, down 18% from a year earlier, and hyaluronic acid manufacturing revenue was $7.5 million, down 19%. Gross profit was $6.8 million. Gross profit margin was 27.0%, up from 25.0% a year earlier. Operating expenses were $7.7 million, down 28.9% from $10.9 million a year earlier.

Net loss widened to $40.1 million, or $1.08 a share, from $10.0 million, or $0.29 a share, a year earlier. The quarter’s operating loss was $894,000. The net loss included a $31.3 million charge for the change in fair value of a related-party debt derivative liability, versus $375,000 a year earlier, and $7.7 million of related-party interest expense. Adjusted EBITDA, a non-GAAP measure that excludes that derivative charge, was $4.0 million, up $1.0 million from $3.1 million a year earlier.

President and chief executive officer Paul Josephs said Lifecore secured two new technology-transfer projects in the third quarter: one to support process performance qualification batches for a biotech company’s new drug application for a new chemical entity, and one for a currently marketed product at a large pharmaceutical company. He said the company believes the programs will add to its high-value pipeline and expects each to contribute to long-term revenue growth objectives beginning in 2027. Early in the fourth quarter, the company said it secured three new development-phase programs, including one Phase 2 product with a top-20 global pharmaceutical company and two Phase 3 products with two biotech companies.

The company ended September 30, 2026, with about $38.0 million of liquidity, including $23.0 million of cash and $15.0 million of revolving credit availability. Cash and cash equivalents were $23.0 million. Related-party debt, net of current portion, was $154.5 million, and the related-party debt derivative liability was $62.2 million. Stockholders’ deficit was $73.4 million.

The November 4 release also disclosed a proposed merger dated September 27, 2026, among Lifecore, Lifecore Inc. and Hazel Merger Sub, Inc. The company listed related risks, including that the transaction may not close, possible termination fees, effects on personnel and customer relationships, and restrictions during the pendency of the deal.