Simply Good Foods Sales Decline Widens in Fourth Quarter

The Tip Desk · November 10, 2026 · 4 min read

Net sales were $333.3 million, down 9.7%, as the company guided fiscal 2027 sales down 13% to 17%.

The Simply Good Foods Company (SMPL) reported net sales of $333.3 million for the thirteen weeks ended August 29, 2026, a 9.7% year-over-year decline that was steeper than the 6.3% drop in the third quarter.

The nutritional-snacking company said the sales miss was driven by Atkins and OWYN, which fell 14.9% and 20.6%, respectively, after Atkins declined 24.6% in the third quarter while Quest and OWYN had grown 1.1% and 3.6%. Combined retail takeaway decreased about 8%, with Atkins down approximately 23%, OWYN 7%, and Quest 2%. The company said performance was largely driven by softer retail takeaway and velocity-related distribution pressure.

Gross profit was $113.3 million, and gross margin was 34.0%, down 30 basis points from a year earlier. The company attributed the margin decline largely to higher input costs, with volume declines and restructuring costs also reducing gross profit. Selling and marketing expenses were $32.4 million, essentially unchanged from the year-ago quarter. General and administrative expenses of $30.6 million, including $1.9 million of restructuring costs, decreased 24.8% from a period that included $8.7 million of integration expenses. Net interest expense of $4.7 million rose 28.7% due to a higher debt balance.

The company swung to net income of $30.5 million, or $0.34 a share, from a $12.4 million net loss a year earlier. Adjusted diluted EPS was $0.44 versus $0.46. Adjusted EBITDA was $57.5 million, down 13.2% year-over-year, after a 22.5% decline to $57.2 million in the third quarter. Weighted average diluted shares outstanding of 88.5 million declined modestly on share repurchases.

For the fifty-two weeks ended August 29, 2026, net sales were $1,356.5 million, down 6.5%, with Atkins down 20.9% and OWYN 9.7%, partially offset by Quest growth of 0.7%. Full-year Adjusted EBITDA was $225.9 million, down 18.8%, versus a third-quarter outlook of $220 million to $225 million. The company reported a full-year net loss of $155.9 million, or $1.69 a share, versus net income of $103.6 million a year earlier. Adjusted diluted EPS was $1.70 versus $1.92.

Prior to the fourth quarter the company recognized $331.0 million of non-cash impairment charges related to goodwill and the Atkins and OWYN brand intangible assets, after $82.0 million of impairments in the third quarter and $249.0 million in the second quarter. The company said the impairment is largely the result of current fiscal year performance, updated projections of future revenue, and declines in stock price.

At year-end, cash was $138.4 million and the term-loan principal balance was $350.0 million, giving a trailing-twelve-month net-debt-to-Adjusted-EBITDA ratio of 0.9x. Cash flow from operations was about $181.0 million. Capital expenditures were approximately $24.1 million.

For fiscal 2027, the company expects net sales to decline between 13% and 17% year-over-year, GAAP gross margins to increase between 250 and 300 basis points, and Adjusted EBITDA to decline between 9% and 14%. It expects net interest expense of $18 million to $20 million and capital expenditures of $15 million to $20 million. For the first quarter of fiscal 2027, it expects net sales to decline between 19% and 22%, GAAP gross margins to increase by approximately 100 basis points, and Adjusted EBITDA to decline between 28% and 33%. The outlook assumes current economic conditions, consumer purchasing behavior, and prevailing tariff rates remain generally consistent.

President and Chief Executive Officer Joe Scalzo said fiscal 2026 was a year of decisive action and that the company delivered on modest financial commitments made after a second-quarter reset. He said fiscal 2027 will be a challenging but important year in the turnaround, with the company reinvesting a portion of margin recovery behind its brands. The company said it expects performance to improve over the course of the year as marketing investments take hold, the volume impact of pricing eases, and year-over-year comparisons become more favorable.