Overview of ChromaDex’s Financial Performance

ChromaDex is a leading company in the emerging field of NAD+ research and development. Through its ChromaDex External Research Program (CERP), the company has built over 300 research partnerships with top universities and institutions around the world to advance the understanding of NAD+ and its role in health, disease, and aging.

For the first quarter of 2025, ChromaDex reported strong financial results. Total net sales increased by 38% to $30.5 million compared to the same period in 2024. This growth was driven by a 24% increase in sales from the Consumer Products segment, a 100% increase in the Ingredients segment, and a 14% increase in the Analytical Reference Standards and Services segment.

Gross profit also improved significantly, increasing by 44% to $19.3 million. This was due to enhanced operational efficiency and favorable product mix shifts across ChromaDex’s business segments. Cost of sales as a percentage of net sales improved by 270 basis points to 37%, reflecting the company’s efforts to optimize its supply chain and manufacturing processes.

Segment Performance

The Consumer Products segment, which includes the company’s flagship Tru Niagen® brand, saw a 24% increase in net sales to $21.5 million. This was primarily attributable to a $4.0 million increase in e-commerce sales, reflecting continued growth in consumer demand and effective digital marketing initiatives. Sales through distributor partners, including A.S. Watson, also contributed to the segment’s growth.

The Ingredients segment, which develops and commercializes ChromaDex’s proprietary Niagen® ingredient, experienced a 100% increase in net sales to $8.2 million. This was driven by higher sales to key food-grade Niagen® partners, contributing $2.9 million, as well as the launch of pharmaceutical-grade Niagen®, which added $1.0 million in sales during the quarter.

The Analytical Reference Standards and Services segment, the smallest of the three, grew 14% to $0.8 million in net sales.

Operational Efficiency and Cost Management

ChromaDex’s focus on operational efficiency and cost management is evident in its improved gross margins. Total cost of sales as a percentage of net sales decreased by 270 basis points to 37%, reflecting better labor and overhead utilization, as well as favorable shifts in product mix.

The company’s sales and marketing expenses increased by 20% to $8.1 million, but as a percentage of net sales, they improved by 380 basis points to 27%. This was driven by higher investments in advertising and marketing to support brand growth in the Consumer Products segment, while maintaining disciplined spending.

Research and development (R&D) expenses decreased by 40% to $1.3 million, as the company normalized spending following the successful launch of its Niagen Plus product line and the pharmaceutical-grade Niagen® initiative.

General and administrative expenses remained relatively flat, decreasing by 3% to $5.2 million, primarily due to a reduction in credit loss expense.

Liquidity and Capital Resources

As of March 31, 2025, ChromaDex had $55.6 million in cash and cash equivalents, including $152,000 in restricted cash. The company has no outstanding borrowings under its line of credit and anticipates that its current unrestricted cash and cash equivalents, along with cash generated from net sales, will be sufficient to meet its financial obligations over the next twelve months and beyond.

However, the company may seek additional funds to support both its short-term and long-term operating objectives, either through additional equity or debt financings or collaborative agreements.

Outlook and Key Risks

ChromaDex’s strong financial performance in the first quarter of 2025 reflects the growing demand for its Niagen® ingredient and Tru Niagen® consumer product, as well as the company’s focus on operational efficiency and cost management.

Looking ahead, the company’s future success will largely depend on the continued growth of its Tru Niagen® brand and the successful commercialization of its Niagen® ingredient, both in the food-grade and pharmaceutical-grade markets. The company’s ability to maintain and develop its sales, marketing, and distribution capabilities, as well as its relationships with key customers, will be critical to its success.

Key risks facing ChromaDex include the need for additional financing to support its long-term growth plans, potential interruptions in its relationships with major customers, competition from larger players in the wellness industry, and the potential for fluctuations in its operating results due to various factors.

Additionally, the company’s reliance on a single supplier, W.R. Grace, for its NRC (Niagen® raw material) and a limited number of third-party suppliers for other raw materials, presents a risk that could have a material adverse effect on its operations and financial results if the company is unable to reach a new long-term supply agreement with Grace on acceptable terms.

Overall, ChromaDex’s strong financial performance in the first quarter of 2025, coupled with its robust research pipeline and focus on operational efficiency, position the company well to continue its growth and capitalize on the emerging opportunities in the NAD+ space.