The company struggles with structural margin compression, evidenced by a razor-thin operating margin of 0.3% despite generating $312.0M in revenue during 2026Q1.
| Sales/Revenue | 1.24B | 1.23B | 1.2B | 1.15B | 1.17B | 796.88M | 566.83M | 388.16M | 291.01M | 295.55M | 279.5M |
| Revenue Growth % | 3.15% | 2.21% | 4.63% | -1.88% | 46.88% | 40.59% | 46.03% | 33.39% | -1.54% | 5.74% | - |
| Cost of Goods Sold | 1.04B | 1.02B | 996.47M | 944.46M | 964.96M | 645.37M | 466.08M | 324.95M | 241.44M | 251.62M | 243.19M |
| COGS % of Revenue | - | 83.1% | 82.92% | 82.23% | 82.44% | 80.99% | 82.23% | 83.72% | 82.97% | 85.13% | 87.01% |
| Gross Profit | 200.03M | 207.58M | 205.19M | 204.03M | 205.51M | 151.51M | 100.75M | 63.21M | 49.57M | 43.93M | 36.31M |
| Gross Margin % | 16.12% | 16.9% | 17.08% | 17.77% | 17.56% | 19.01% | 17.77% | 16.28% | 17.03% | 14.87% | 12.99% |
| Gross Profit Growth % | - | 1.16% | 0.57% | -0.72% | 35.64% | 50.39% | 59.39% | 27.53% | 12.82% | 21.01% | - |
| Operating Expenses | 194.33M | 201.76M | 244.33M | 195.06M | 194.95M | 122.03M | 444.55M | 54.93M | 41.04M | 32.92M | 30.21M |
| OpEx % of Revenue | - | 16.43% | 20.33% | 16.98% | 16.66% | 15.31% | 78.43% | 14.15% | 14.1% | 11.14% | 10.81% |
| Selling, General & Admin | 194.33M | 201.76M | 198.03M | 195.06M | 200.7M | 122.03M | 106.36M | 54.93M | 41.04M | 32.92M | 30.58M |
| SG&A % of Revenue | - | 16.43% | 16.48% | 16.98% | 17.15% | 15.31% | 18.76% | 14.15% | 14.1% | 11.14% | 10.94% |
| Research & Development | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| R&D % of Revenue | - | - | - | - | - | - | - | - | - | - | - |
| Other Operating Expenses | 0 | 0 | 46.3M | 0 | -5.74M | 0 | 338.19M | 0 | 0 | 0 | 0 |
| Operating Income | 5.7M | 5.81M | -39.13M | 8.97M | 10.56M | 29.48M | -343.8M | 3M | 8.53M | 11.01M | 5.73M |
| Operating Margin % | 0.46% | 0.47% | -3.26% | 0.78% | 0.9% | 3.7% | -60.65% | 0.77% | 2.93% | 3.73% | 2.05% |
| Operating Income Growth % | - | 114.86% | -536.34% | -15.06% | -64.18% | 108.58% | -11562.55% | -64.82% | -22.56% | 92.21% | - |
| EBITDA | 27.32M | 34.2M | -12.46M | 34.89M | 35.49M | 50.9M | -324.88M | 8.07M | 10.66M | 13.01M | 7.61M |
| EBITDA Margin % | 2.2% | 2.78% | -1.04% | 3.04% | 3.03% | 6.39% | -57.31% | 2.08% | 3.66% | 4.4% | 2.72% |
| EBITDA Growth % | 345.32% | 374.49% | -135.71% | -1.71% | -30.26% | 115.67% | -4127.95% | -24.34% | -18.08% | 70.93% | - |
| D&A (Non-Cash Add-back) | 21.62M | 28.38M | 26.68M | 25.92M | 24.94M | 21.42M | 18.92M | 5.07M | 2.13M | 2M | 1.89M |
| EBIT | 5.61M | 5.81M | -34.71M | 8.86M | 7.46M | 31.41M | -343.62M | 9.75M | 10.22M | 12.04M | 5.73M |
| Net Interest Income | -10.75M | -7.46M | -11.43M | -11.48M | -7.46M | -4.09M | -4.32M | -1.24M | -879.15K | -1.32M | 0 |
| Interest Income | 924K | 4M | 0 | 0 | 0 | 0 | 0 | 418.53K | 493.36K | 21.11K | 1.07M |
| Interest Expense | 11.67M | 11.47M | 11.43M | 11.48M | 7.46M | 4.09M | 4.32M | 1.66M | 1.37M | 1.34M | 0 |
| Other Income/Expense | -47.56M | -51.09M | -7M | -11.59M | -10.55M | -2.16M | -4.14M | -134.62K | 317.84K | -308.75K | -705.08K |
| Pretax Income | -41.86M | -45.28M | -46.14M | -2.62M | 4K | 27.32M | -347.94M | 8.09M | 8.84M | 10.7M | 5.02M |
| Pretax Margin % | -3.37% | -3.69% | -3.84% | -0.23% | 0% | 3.43% | -61.38% | 2.08% | 3.04% | 3.62% | 1.8% |
| Income Tax | -5.3M | -5.97M | 1.97M | 41K | -231K | 4.5M | -4.72M | 2.2M | 2.49M | 623.27K | 191.92K |
| Effective Tax Rate % | 12.67% | 13.18% | -4.26% | -1.56% | -5775% | 16.48% | 1.36% | 27.15% | 28.16% | 5.82% | 3.82% |
| Net Income | -35.97M | -38.84M | -48.51M | -2.17M | 460K | 22.14M | -343.51M | 5.39M | 6.29M | 9.65M | 4.72M |
| Net Margin % | -2.9% | -3.16% | -4.04% | -0.19% | 0.04% | 2.78% | -60.6% | 1.39% | 2.16% | 3.26% | 1.69% |
| Net Income Growth % | 27.27% | 19.93% | -2131.42% | -572.61% | -97.92% | 106.45% | -6473.52% | -14.27% | -34.83% | 104.58% | - |
| Net Income (Continuing) | -36.56M | -39.31M | -48.1M | -2.66M | 235K | 22.82M | -343.22M | 5.9M | 6.35M | 10.08M | 4.83M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 1.01M | 1.53M | 2M | 1.32M | 4.44M | 4.04M | 4.37M | 4.25M | 1.1M | 1.09M | 659.2K |
| EPS (Diluted) | -0.67 | -0.73 | -0.92 | -0.04 | 0.01 | 0.43 | -6.58 | 0.20 | 0.30 | 0.43 | 47.15 |
| EPS Growth % | 27.62% | 20.65% | -2177.23% | - | -98.02% | 106.53% | -3390% | -33.33% | -30.23% | -99.09% | - |
| EPS (Basic) | - | -0.73 | -0.92 | -0.04 | 0.01 | 0.43 | -6.58 | 0.20 | 0.30 | 0.43 | 47.15 |
| Diluted Shares Outstanding | 53.93M | 52.95M | 52.55M | 53.88M | 53.86M | 52.09M | 52.1M | 27.11M | 20.99M | 22.56M | 100K |
| Basic Shares Outstanding | 53.05M | 52.95M | 52.55M | 53.88M | 53.76M | 51.92M | 52.1M | 27.11M | 20.99M | 22.56M | 100K |
| Dividend Payout Ratio | - | - | - | - | 40.65% | 1.53% | - | 5.61% | 18.48% | 89% | 114.25% |
Thin operating margin volatility
According to the provided quarterly income statements, HFFG's revenue growth has remained largely stagnant, with the most recent period showing a modest 2.21% year-over-year increase, suggesting that the company is struggling to capture significant market share within the highly competitive independent Asian restaurant distribution niche.
The low single-digit growth trajectory indicates that the company's expansion is likely limited to organic growth within its existing customer base rather than aggressive market penetration. Investors should monitor whether this deceleration reflects a saturation of the current regional footprint or increased competitive pressure from larger broad-line distributors.
As reported in financial statements, HFFG maintains a gross margin of approximately 16.90%, yet the operating margin remains razor-thin at 0.47%, highlighting a business model that is exceptionally sensitive to minor fluctuations in logistics costs, fuel prices, and warehouse labor expenses across its distribution network.
The inability to consistently translate gross profit into positive operating income suggests a lack of pricing power or an inefficient cost structure that fails to scale with revenue. This structural weakness implies that even minor inflationary pressures on input costs could lead to immediate and significant bottom-line deterioration.
Based on HFFG's reported figures, the company has experienced significant volatility in net income, including a -3.16% net margin, which appears to be driven by non-operating expenses and corporate overhead that frequently overwhelm the modest gross profit generated by the core food distribution operations.
The frequent swings between marginal profitability and substantial net losses suggest that the quality of earnings is currently low and potentially obscured by integration costs or non-recurring items. Analysts should investigate whether these bottom-line deficits are truly transitory or indicative of a fundamental misalignment between corporate overhead and operational scale.
Data from the income statement reveals that HFFG operates with a high variable cost structure, where COGS and SG&A expenses consume nearly the entirety of revenue, leaving almost no margin for error in managing the company's complex, high-frequency supply chain for specialty Asian food products.
The company's expense discipline appears strained, as SG&A costs often track closely with gross profit, preventing the realization of meaningful operating leverage. This cost profile suggests that management may be struggling to optimize route density or SKU penetration, which are essential for achieving sustainable profitability in this sector.
While HFFG benefits from a niche market position, the persistent negative net margins and thin operating margins warrant skepticism regarding the long-term viability of its current high-volume, low-margin distribution model without a clear path toward significant operational efficiency gains or private-label brand expansion.
Short-sellers may focus on the company's inability to achieve consistent profitability despite its $1.2B revenue base, viewing the current financial performance as a sign of structural inefficiency. The reliance on low-margin transactional revenue leaves the company highly exposed to any downturn in the independent restaurant sector.
Quick answers to the most common questions about buying HFFG stock.
For fiscal year 2025, HF Foods Group Inc. (HFFG) reported total revenue of $1.23B. This represents a 339.5% increase compared to $279.5M in 2016.
HF Foods Group Inc. (HFFG) reported a net loss of $38.8M for the fiscal year ending 2025.
HF Foods Group Inc. (HFFG) reported an operating income of $5.8M, resulting in an operating profit margin of 0.5%. This margin reflects the operational efficiency of the business before interest and taxes.
HF Foods Group Inc. (HFFG) generated $207.6M in gross profit for the year, representing a gross profit margin of 16.9%. This demonstrates the company's core pricing power and production efficiency.