Executive Summary

Q4 2024 delivered 26% year-over-year revenue growth to $7.2M, with gross margin at 36% and adjusted EBITDA loss improving to approximately $0.70M; momentum was driven by 32% growth across Amazon and Chewy and more than doubling Asia Pacific volume .
The full-year turnaround progressed: gross margin rose to 37% (+650 bps YoY), adjusted EBITDA loss improved 78% to $1.9M, and SG&A fell 22%; balance sheet strengthened via $6.2M gain on extinguishment and working capital of $7.9M .
Strategic actions post-year-end: definitive agreement to sell Halo Asia for $6.5M cash plus a 3% royalty (min $330k/yr for 5 years), an agreed-in-principle 5.5% royalty on Halo Elevate in Asia, and plan to distribute up to 55% of annual Halo royalties to shareholders of record each year .
The SRx Health acquisition is expected to close in April, positioning BTTR as a broader health and wellness company; management emphasizes operational leverage and continued top-line momentum into 2025 .
Wall Street consensus (S&P Global) was not available for BTTR; estimate comparisons could not be performed.

What Went Well and What Went Wrong

What Went Well

Digital acceleration: Q4 revenue grew 26% YoY to $7.2M, with Amazon and Chewy up 32%, supported by Black Friday promotions and best Amazon quarter since Q1 2023 .
Margin and cost discipline: Q4 gross margin was 36%; full-year gross margin reached 37% (+650 bps YoY), SG&A declined 22%, inventory fell over 40%, and direct cost per pound improved 4% .
Balance sheet progress: $6.2M gain from extinguishing debt and payables; working capital rose to $7.9M, cash was $3.0M, borrowing capacity $2.4M; adjusted EBITDA loss narrowed meaningfully in Q4 and FY .

Management quotes:

“Our brand’s performance was highlighted by an impressive fourth quarter revenue growth of 26% year-over-year... 32% growth across Amazon and Chewy” .
“Full year gross margin increased over 650 basis points year-over-year to 37%” .
“Adjusted EBITDA loss improved 80% year-over-year to approximately $700,000 loss” in Q4 .

What Went Wrong

Consolidated FY net revenues were $35M, down 9% due to strategic exits from non-core brick-and-mortar and closing unprofitable DTC; domestic topline softness persisted despite digital growth .
Q4 gross margin at 36% trailed Q3’s 40% as mix shifted and promotional intensity rose; adjusted EBITDA turned negative in Q4 after a positive Q3 as seasonal and promotional dynamics weighed .
Liquidity usage: net cash used in operations totaled $4.4M in FY due to supplier paydowns and noncash gain accounting; investing outflows $2.3M, though partially offset by $5.5M financing inflows .

Analyst concerns likely include sustainability of digital-driven growth without formal guidance, the impact of divestitures on future scale, and margin variability across quarters .

Financial Results

Consolidated Performance vs Prior Quarters

Metric	Q2 2024	Q3 2024	Q4 2024
Revenue ($USD Millions)	$8.542	$11.40	$7.20
Gross Margin (%)	38.0%	40.0%	36.0%
Adjusted EBITDA ($USD Millions)	$(0.03)	$0.20+	$(0.70)
Net Income ($USD Millions)	$2.654	$1.50	n/a
EPS ($USD)	$2.98	$0.74	n/a

Notes: Q3 adjusted EBITDA described as “just over $200,000” and Q4 adjusted EBITDA loss as “approximately $700,000” .

Year-over-Year and Sequential Dynamics

Metric	Q2 2024 YoY	Q2 2024 QoQ	Q3 2024 QoQ	Q4 2024 YoY
Revenue	$8.542M vs $16.445M in Q2’23 (decline)	+8% vs Q1	+33% vs Q2	+26% YoY
Gross Margin	+403 bps YoY to 38%	n/a	+165 bps seq to 40%	36% (improved vs FY trend)
Adjusted EBITDA	+98% YoY to ≈$(0.03)M	n/a	Positive (~$0.20M)	Loss improved to ≈$(0.70)M

Segment/Channel Breakdown (growth indicators)

Segment/Channel	Q2 2024	Q3 2024	Q4 2024
Digital (Amazon & Chewy)	+11% QoQ	+10% YoY	+32% YoY
International (Asia Pacific)	+27% QoQ; +7% YTD YoY	+92% QoQ; +9% YoY	Volume more than doubled
Brick-and-Mortar (exits)	Strategic exits ongoing	Reset for profitability	Continued focus on e-commerce
Direct-to-Consumer (DTC)	Closed (unprofitable)	n/a	n/a

Operating KPIs

KPI	Q2 2024	Q3 2024	Q4 2024
Average Fill Rate	~95%	~97%	>95% service levels
Inventory Reduction	-57% YoY FG inventory	-48% YoY inventory	>40% reduction
Working Capital ($USD Millions)	$3.94 (balance sheet)	$9.5	$7.9
Cash & Equivalents ($USD Millions)	$3.293	n/a	$3.0
Credit Facility Capacity ($USD Millions)	n/a	n/a	$2.4

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance/Action	Change
Halo Asia Sale Consideration	Closing expected by end of April 2025	n/a	$6.5M cash at closing + 3% royalty for 5 years; minimum $330k/yr ($1.65M total minimum)	New
Halo Elevate Asia Royalty	Ongoing (post-closing)	n/a	5.5% royalty agreement in principle with existing Asia partner	New
Royalty Distribution Plan	Annually (FY 2025–2029)	n/a	Up to 55% of annual Halo royalties distributed to stockholders of record as of Dec 31	New
SRx Health Acquisition	Expected close April 2025	n/a	Proceeding to close; strategic expansion into specialty health	New

No quantitative revenue/margin/OpEx/tax guidance was issued for 2025; management emphasized continued margin expansion and profitable growth focus .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 & Q3)	Current Period (Q4)	Trend
E-commerce focus (Amazon/Chewy)	Q2: Shifted marketing to Amazon/Chewy; Chewy Elevate launch; subscription growth ; Q3: +10% YoY digital; new-to-brand +23%; repeat units +20% QoQ	Q4: +32% YoY across Amazon/Chewy; best Amazon quarter since Q1’23	Strengthening
Margin discipline	Q2: GM 38% (+403 bps YoY); adjusted EBITDA improved 98% YoY	Q3: GM 40% (third consecutive expansion)	Q4: GM 36%; FY GM 37% (+650 bps YoY)
Asia Pacific growth	Q2: International +27% QoQ	Q3: Asia +92% QoQ; +9% YoY	Q4: More than doubled Asia volumes; Asia asset sale & royalty plans
Working capital & debt	Q2: $3.6M debt extinguishment gain; equity raise ~$4.5M; WC improved	Q3: WC $9.5M; further gains/paydowns	Q4: $6.2M gain; WC $7.9M; liquidity metrics disclosed
SRx Health strategic expansion	Q3: Announced planned acquisition; SRx ~$CAD180M revenue, positive EBITDA	Q4: Closing expected in April; combined health & wellness strategy	Strategic broadening
Supply chain/forecasting	Q2: Fill rate ~95%; inventory -57% YoY	Q3: Fill rate ~97%; inventory -48% YoY	Q4: Service levels >95%; COGS per pound -4%

Management Commentary

CEO: “Our brand’s performance was highlighted by an impressive fourth quarter revenue growth of 26% year-over-year... 32% growth across Amazon and Chewy... We also successfully launched Halo on Chewy Canada in November” .
CFO: “Full year gross margin increased over 650 basis points year-over-year to 37%... SG&A reduction of 22%... adjusted EBITDA loss improved 78% year-over-year to a $1.9 million loss” .
Strategic: “We signed a definitive agreement to sell Halo Asia... $6.5 million in cash at closing along with a 3% royalty... Board... approved a royalty distribution plan of up to 55%... to be distributed annually to stockholders of record” .
Outlook: “We are well positioned to capitalize... focus will remain on profitable revenue growth, expanding margins and continuing to strengthen our working capital position” .

Q&A Highlights

Q&A content was not available in the retrieved transcript due to document read limitations; management’s prepared remarks emphasized e-commerce growth, international monetization, margin discipline, and the SRx Health strategic transaction .

Estimates Context

Wall Street consensus (S&P Global) for Q4 2024 EPS and revenue was unavailable due to missing CIQ mapping for BTTR; as a result, comparisons to consensus and beat/miss analysis could not be performed.

Key Takeaways for Investors

Digital channels are the growth engine: sustained improvements across Amazon/Chewy, with promotional lifts and subscription engagement supporting repeat behavior .
Margin trajectory is improving on a full-year basis; quarterly variability reflects mix and promotions. Continued SG&A discipline and COGS efficiencies underpin medium-term margin expansion .
Asia monetization is a near-term catalyst: cash proceeds plus ongoing royalty streams, with a shareholder royalty distribution plan offering potential recurring return of capital .
Balance sheet strengthening reduces risk: debt/payable extinguishments and improved working capital provide flexibility to invest behind e-commerce and core product innovation .
SRx Health combination broadens scope and may introduce synergistic growth opportunities; execution updates post-close will be key to the medium-term thesis .
Without formal numerical guidance or available Street estimates, monitoring quarterly channel mix, international volumes, and gross margin cadence is critical for near-term trading.
Watch for April transaction milestones (Halo Asia close, SRx Health close) and any follow-on details on royalty distribution mechanics to assess capital return profile .

Better Choice Co Inc. (BTTR)·Q4 2024 Earnings Summary