INNOVATIVE FOOD HOLDINGS INC
For the period ended Sep 30, 2025. Filed Nov 14, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 14, 2025
IVFHStored price and day change unavailable
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-14.
0001185185-25-000972
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-14.
0001185185-25-001727
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 55 previous paragraphs and 63 current paragraphs.
40 unchanged; 7 reworded; 16 added; 8 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 47 previous and 29 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (16)
Current report
Provision for Credit Losses Receivable
Current report
Inventory
Current report
Inventory consists of food products and is valued at the lower of cost or net realizable value. Cost is determined using the average-cost method. The Company adjusts the inventory based upon bi-weekly cycle counts and upon the expiration date of food products. In addition, the Company records a provision for excess, obsolete, and slow-moving inventory. Adjustments to reduce inventory to net realizable value are recorded when necessary and included in cost of sales.
Current report
Impairment of Intangible Assets
Current report
Indefinite-lived intangible assets are not amortized but are tested for impairment at least annually, or more frequently if events or changes in circumstances indicate that the assets might be impaired. Intangible assets with finite useful lives are amortized on a straight-line basis over their estimated useful lives and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.
Current report
Cost of goods sold for the three months ended September 30, 2025 increased 3.1% to $12.6 million compared to $12.2 million in the prior year period, which is generally consistent with the 3.5% increase in revenue. Gross margin decreased by 34 basis points to 23.5%, primarily due to changes in the overall sales mix. The improvement in gross margin from continuing operations is largely attributable to the discontinuation of our retail cheese business, which carried lower margins.
Current report
Total Cash OpEx increased by $1.1 million, or 40 %. The increase was primarily driven by the Denver facility, which was not part of our operations in the prior-year period and accounted for approximately $500 thousand of the increase. The quarter also included approximately $72 thousand in higher fleet-related expenses, $174 thousand in severance, and approximately $78 thousand from wage and benefit inflation.
Current report
Retail Cheese Operations revenue was $3.4 million in the current period compared to $0.2 million in the prior year period. This activity reflects the sell through of remaining product associated with the wind down of our discontinued retail cheese operations. We expect only minimal sales in the fourth quarter as the remaining cheese inventory is sold, after which revenue from this business is not expected on a go forward basis.
Current report
The discontinued operations reported a net loss of $2.4 million in the current quarter. We continue to progress toward the sale of the Pennsylvania facility, which we anticipate will close in the fourth quarter. Upon completion of the sale, we expect a significant reduction in overhead costs associated with these operations.
Current report
Nine Months Ended September 30, 2025
Current report
Cost of goods sold for the nine months ended September 30, 2025 was 37.2 million, an increase of 7.85% compared to 34.5 million in the prior year period. This is generally in line with the increase in sales of 8.26%. As a result, gross margin increased 29 basis points to 24.5%. The gross margin performance was driven by sales mix, including a 99 basis point increase in digital and a 57 basis point increase in airlines, partially offset by a 524 basis point decline in local. Local distribution in the current period includes both the Denver and Chicago facilities, whereas the prior year period included only Chicago. The Denver facility carries a different product mix than Chicago, which contributed to the change in local distribution margin.
Current report
Total Cash Operating Expenses increased by $2.4 million. The increase was primarily driven by the new Denver facility, which was not included in the prior year financials and accounted for approximately $1.6 million of the increase. The quarter also included approximately $160 thousand in higher fleet costs, $174 thousand in CEO severance, and approximately $180 thousand from wage and benefit inflation.
Current report
Retail Cheese Operations revenue was $10.7 million for the nine months ended September 30, 2025, compared to $0.2 million in the prior year period. Q3 revenue reflects the sell through of remaining product associated with the wind down of this business. The discontinued operations reported a net loss of $3.8 million for the nine month period. Sales are expected to substantially conclude in the fourth quarter as the remaining cheese inventory is sold, after which revenue from these operations is not expected on a go forward basis.
Current report
As of September 30, 2025, IVFH had current assets of $18.6 million and current liabilities of $13.6 million, including an $8.8 million note classified as current due to its expected repayment upon the sale of the related business. Although the note is not contractually due within one year, it is presented within current liabilities based on the expected timing of the sale transaction. Net working capital was $5 million.
Current report
We believe we have sufficient liquidity to fund operations for at least the next twelve months. With the shutdown of the Pennsylvania facility, operating cash flows are expected to improve as facility costs and lower margin product sales roll off. Upon the sale of the facility, we intend to use the proceeds to repay the associated note, which will reduce overhead and interest expense. We do not anticipate the need to raise additional capital. We are working on a new credit facility to provide working capital flexibility. Remaining severance obligations are not expected to be material, and staffing levels are being managed to align with current business needs.
Current report
Sams Club accounted for approximately 18% and 0% of total consolidated sales in 2025 and 2024, respectively. Sales to Sams Club related entirely to the discontinued Pennsylvania distribution operations and are not expected to continue in future periods
Removed paragraphs (8)
Previous report
Provision for Doubtful Accounts Receivable
Previous report
Cost of goods sold for the three months ended June 30, 2025 increased 31.9% to $16.7 million compared to $12.6 million last year. Gross margin dropped by 294 basis points to 21%, mainly due to changes in our sales mix as we expanded our cheese business. Cheese products sold to retailers carry lower margins than our other offerings and accounted for 17.5% of Q2 2025 sales, versus 0% in Q2 2024. Excluding cheese, gross margins increased 66 bps. The margin improvement was primarily attributable to lower shipping costs, which contributed a 34 basis point increase in total margin. Shipping costs represented 10.3% of revenue in Q2 2025, compared to 10.7% in the prior-year period.
Previous report
Total Cash OpEx increased: The total Cash OpEx increased by $1 million, or 19.8%, reflecting growth in our national distribution channels and M&A activity in Q4 2024.
Previous report
Six Months Ended June 30, 2025
Previous report
Cost of goods sold for the first half of 2025 increased 30.3% to $31.7 million, compared to $24.4 million in the prior-year period. Gross margin declined by 228 basis points to 21.9%, primarily due to the expansion of our cheese business. Cheese products, which carry lower margins than our core offerings, represented 18.1% of total sales in H1 2025, compared to 0% in H1 2024. Excluding cheese sales, gross margin increased 118 basis points. This increase was driven by decreased platform fees, which improved margins by approximately 133 basis points, and lower shipping costs, which improved margins by 84 basis points. This impact was partially offset by higher product and fulfilment costs, which lowered margins by 99 basis points.
Previous report
Total Cash OpEx increased: The total Cash OpEx increased by $1.8 million, reflecting growth in our national distribution channels and M&A activity in Q4 2024.
Previous report
Non-Recurring Expenses:
Previous report
As of June 30, 2025, IVFH had current assets of $20.7 million, including cash and cash equivalents of $1.5 million, and current liabilities of $6.5 million. The company had net working capital of $14.3 million.
Reworded paragraphs (7)
Previous wording
The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. These estimates include certain assumptions related to, among others, doubtful accounts receivable, valuation of stock-based services, operating right of use assets and liabilities, and income taxes. On an on-going basis, we evaluate these estimates, including those related to revenue recognition and concentration of credit risk. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Accounts subject to estimate and judgements are accounts receivable reserves, income taxes, intangible assets, contingent liabilities, and equity-based instruments. Actual results may differ from these estimates under different assumptions or conditions. We believe our estimates have not been materially inaccurate in past years, and our assumptions are not likely to change in the foreseeable future.
Current wording
The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. These estimates include certain assumptions related to, among others, doubtful accounts receivable, inventory, valuation of stock-based services, operating right of use assets and liabilities, impairment of intangible assets, and income taxes. On an on-going basis, we evaluate these estimates, including those related to revenue recognition and concentration of credit risk. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Accounts subject to estimate and judgements are accounts receivable reserves, income taxes, intangible assets, contingent liabilities, and equity-based instruments. Actual results may differ from these estimates under different assumptions or conditions. We believe our estimates have not been materially inaccurate in past years, and our assumptions are not likely to change in the foreseeable future.
Previous wording
The Company provides an allowance for doubtful accounts equal to the estimated uncollectible amounts pursuant to the guidance of Accounting Standards Update (“ASU”) 2016-13,Financial Instruments–Credit Losses (Topic 326), as codified in Accounts Standards Codification (“ASC”) 326,Financial Instruments–Credit Losses. Under ASC 326, the Company utilizes a current and expected credit loss (CECL) impairment model. ASU 2016-13 became effective for us on January 1, 2023. The Company’s estimate is based on historical collection experience and a review of the current status of trade accounts receivable. It is reasonably possible that the Company’s estimate of the allowance for doubtful accounts will change. Accounts receivable are presented net of an allowance for doubtful accounts of $40,000 at June 30, 2025 and December 31, 2024.
Current wording
The Company provides an allowance for credit losses equal to the estimated uncollectible amounts pursuant to the guidance of Accounting Standards Update (“ASU”) 2016-13, Financial Instruments – Credit Losses (Topic 326) as codified in ASC 326, Financial Instruments – Credit Losses. The Company utilizes a current and expected credit loss (CECL) impairment model. The Company’s estimate is based on historical collection experience and a review of the current status of trade accounts receivable. It is reasonably possible that the Company’s estimate of the allowance for credit losses will change. Accounts receivable are presented net of an allowance for credit losses of $40,002 at September 30, 2025 and December 31, 2024.
Previous wording
The Company determines if an arrangement is a lease at inception. Operating lease right-of-use assets (“ROU assets”) and short-term and long-term lease liabilities are included on the face of the condensed consolidated balance sheet. Finance lease ROU assets are presented within other assets, and finance lease liabilities are presented within accrued liabilities.
Current wording
The Company determines if an arrangement is a lease at inception. Operating lease right-of-use assets (“ROU assets”) and short-term and long-term lease liabilities are included on the face of the condensed consolidated balance sheet.
Previous wording
We leverage this unique, premium assortment to serve the needs of Professional Chefs in settings such as restaurants, hotels, country clubs, national chain accounts, casinos, hospitals and catering houses. We provide these premium customers with products that can’t typically be found through their broadline distributor’s warehouse assortment. We distribute these products directly to Professional Chefs in Chicago through our subsidiary, Artisan Specialty Foods, Inc., and nationally through our e-commerce businesses on Amazon.com and our own website. We also drop ship specialty foods to Professional Chefs nationally through the websites of broadline distributors, such as US Foods, Inc. Lastly, we sell these food to large retailers for resale on their shelves to the end customer. Between this variety of sales channels, we are able to serve our Professional Chef customers wherever they are located.
Current wording
We leverage this unique, premium assortment to serve the needs of Professional Chefs in settings such as restaurants, hotels, country clubs, national chain accounts, casinos, hospitals and catering houses. We provide these premium customers with products that can’t typically be found through their broadline distributor’s warehouse assortment. We distribute these products directly to Professional Chefs in Chicago through our subsidiary, Artisan Specialty Foods, Inc., and nationally through our e-commerce businesses on Amazon.com and our own website. We also drop ship specialty foods to Professional Chefs nationally through the websites of broadline distributors, such as U.S. Foods, Inc. Lastly, we sell these food to large retailers for resale on their shelves to the end customer. Between this variety of sales channels, we are able to serve our Professional Chef customers wherever they are located.
Previous wording
Financial Highlights for the fiscal quarter ended June 30, 2025: IVFH reported revenue of $21.1 million, a 26.9% increase compared to $16.6 million in 2024. Our organic revenue growth, which excludes the impact of divestitures and acquisitions, was 23.6% for the full quarter.
Current wording
Financial Highlights for the fiscal quarter ended September 30, 2025: IVFH reported revenue of $16.4 million, a 3.5% increase compared to $15.9 million in 2024.
Previous wording
During the three months ended June 30, 2025, the company reported a net income from continuing operations of $59 thousand, compared to a net loss of $60 thousand in 2024, representing an increase of $119 thousand. During the six months ended June 30, 2025, the company reported a net loss from continuing operations of $371 thousand, compared to net income of $1.3 million in 2024, representing a decrease of $1.7 million.
Current wording
During the three months ended September 30, 2025, the company reported a net income from continuing operations of $651 thousand, compared to a net income of $861 thousand in 2024, representing a decrease of $210 thousand. During the nine months ended September 30, 2025, the company reported a net income from continuing operations of $1.7 million, compared to net income of $3.5 million in 2024, representing a decrease of $1.7 million.
Previous wording
The Company’s largest customer, U.S. Foods, Inc. and its affiliates, accounted for approximately 34% and 48% of total sales in the three months ended June 30, 2025 and 2024, respectively; Sam’s Club, represented 17% and 0% of total sales, respectively; and Gate Gourmet, the leading global provider of airline catering solutions and provisioning services for airlines, represented 15% and 18% of total sales, respectively.
Current wording
During the nine months ended September 30, 2025 and 2024, U.S. Foods, Inc. and its affiliates accounted for approximately 34% and 47% of total consolidated sales, respectively. Gate Gourmet accounted for approximately 15% and 18% of total consolidated sales, respectively.