Natural Grocers Reports 6.3% Revenue Growth and 26% Net Income Increase in Q3 2025

Natural Grocers by Vitamin Cottage, Inc. reported a solid financial performance for the third quarter of fiscal year 2025, ending June 30, with net sales reaching $328.7 million, a 6.3% increase from $309.1 million in the same period last year. For the nine months ended June 30, total net sales amounted to $994.7 million, reflecting an 8.2% rise compared to $918.9 million in the prior year. The company's net income also saw significant growth, rising 26% to $11.6 million for the quarter and 39% to $34.6 million for the nine-month period. This resulted in diluted earnings per share of $0.50 for the quarter and $1.49 for the nine months, up from $0.40 and $1.08, respectively, in the previous year.

The company experienced notable operational changes, including the opening of two new stores and the relocation or remodeling of two existing stores during the nine months ended June 30, 2025. As of the end of the quarter, Natural Grocers operated 169 stores across 21 states, maintaining its store count from the previous year. The company reported a daily average comparable store sales increase of 7.4% for the quarter and 8.4% for the nine-month period, driven by a combination of higher transaction counts and increased average transaction sizes.

In terms of expenses, the cost of goods sold and occupancy costs increased by 5.3% to $230.4 million for the quarter, while store expenses rose 6.1% to $71.7 million. Administrative expenses also increased by 14.7% to $10.9 million, primarily due to higher technology and compensation costs. Despite these increases, the gross profit margin improved to 29.9% for the quarter, up from 29.2% a year earlier, attributed to effective promotions and cost management strategies.

Looking ahead, Natural Grocers remains optimistic about its growth trajectory, citing a loyal customer base and increasing consumer interest in health and nutrition as key drivers. The company plans to continue expanding its store footprint, with two new store openings and three relocations/remodels planned for fiscal year 2025. However, management acknowledged potential challenges, including competitive pressures and economic conditions that could impact future sales and profitability. The company is also focused on maintaining its operational efficiency and leveraging economies of scale to enhance profitability.