Highlights

  • Bubs secured permanent FDA authorisation for its three infant formula products in September 2026, the only Australian manufacturer to hold this status.
  • US retail scan sales reached a record, rising 46.5% on the prior period, with distribution now exceeding 12,000 stores including a first CVS listing.
  • Group net Revenue was $23.1 million for the September quarter, compared with $25.6 million a year earlier, partly due to a $1.2 million currency headwind.
  • Available Liquidity stood at $13.4 million with the NAB trade finance Facility maturing August 2027, and management estimates about 2.2 quarters of funding runway.

Scan data and regulatory milestones are pulling in one direction; revenue is lagging slightly behind. Bubs Australia (ASX:BUB) posted its first-quarter FY27 results showing record US retail scan sales climbing 46.5% and a landmark permanent FDA authorisation, even as group net revenue dipped to $23.1 million from $25.6 million a year earlier. The company attributes $1.2 million of that decline to currency translation, and frames the gap between scan sales and reported revenue as an inventory normalisation effect that should work through over time.

US Market: Scans Up, Revenue Mixed

In the United States, Bubs reported revenue of $15.3 million (US$10.8 million), against $16.8 million a year earlier. The company says growth at Walmart and Target was offset by lower Amazon channel sales, even though Amazon consumer sell-through — the amount actually consumed by end buyers — rose more than 14% year-on-year. Bubs recorded its first sales in the CVS drug channel during the quarter, and distribution exceeded 12,000 store locations.

Retail scan sales — which measure real-time consumer purchases at point of sale — hit a record, up 46.5% on the prior period. The company treats the scan trend as evidence of strengthening Demand that has not yet fully flowed through to its reported revenue line, partly because Amazon channel revenue and consumer sell-through can diverge as inventory levels change between Bubs and fulfilment partners.

FDA Authorisation and Other Markets

The company received permanent FDA authorisation for its three infant formula products in September 2026 and describes itself as the only Australian manufacturer with this status. It notes possible future opportunities — including private label participation in the US market — but says these depend on further regulatory, technical and commercial steps that are not yet reached.

China revenue was $2.6 million, up slightly from $2.5 million, with sell-through described as normalised after earlier destocking. Australia contributed $4.1 million against $4.4 million in the prior year, with cost-of-living pressure cited alongside early signs of stabilisation. Rest of World revenue was $1.2 million against $1.9 million, reflecting disrupted trading in Vietnam and other affected markets, with an initial resupply shipment to Vietnam completed in the quarter.

Cash Flow and Liquidity

Operating cash outflow was $6.0 million for the quarter, against $4.4 million a year earlier. Receipts from customers were $24.2 million, offset by manufacturing, operating, staff, Advertising and administration payments. A $3.0 million financing inflow came from new borrowings under the trade facility.

Cash fell by $3.0 million over the quarter, from $9.4 million to $6.4 million. The NAB trade refinance facility totals $20.0 million, with $13.0 million drawn, carrying an Interest Rate of 8.62% per annum and maturing on 31 August 2027. Available liquidity, including $7.0 million of undrawn facility capacity, was $13.4 million. Management estimates about 2.2 quarters of funding runway at the current rate of cash use — a figure that will require careful management alongside the August 2027 facility maturity.

Strategy and Priorities

The company's stated priorities for the coming quarters are targeted US Marketing to convert awareness into purchase, earning a return on raw material inventory Investment through higher sales, re-entering Singapore, Vietnam and other affected markets, and balancing cash outflow with growth investment. No numerical guidance was provided.

Key watchpoints are how US distribution gains translate into reported revenue as the currency effect and Amazon channel mix work through, whether the FDA authorisation can be leveraged into additional sales channels such as private label, and how the NAB facility is managed or refinanced against the current funding position.