Lifeway Reports Record Third-Quarter Net Sales Amid Production Constraints and Rising Milk Costs
Lifeway (LWAY) reported record third-quarter net sales of $67.8 million, marking its 28th consecutive quarter of growth. Despite the revenue milestone, the company faced margin compression, with gross margins dropping to 18% due to a significant surge in milk costs. To combat this, management is implementing rolling price increases aimed at returning gross margins to historical levels above 25%. To address production bottlenecks caused by high demand, Lifeway is expanding its Waukesha, Wisconsin facility, which is expected to more than double bottling capacity in 2027. The company also identified significant growth tailwinds from shifting consumer habits, specifically the rise of GLP-1 weight-loss medication users seeking nutrient-dense, probiotic-rich foods to support digestive health.