Q1 2026 Revenues Grew by 85% to $31.9 Million and Adjusted EBITDA Surged by 112%
- Revenues surged by 85% to $31.9 million compared to the same quarter last year - a ninth consecutive record quarter compared to the corresponding quarter
- Dietary supplements segment revenues, which now account for about 81% of total Group revenues, grew to $25.8 million, a triple-digit increase of approximately 162%
- Order backlog for the next 4-5 months in the dietary supplements sector reached a record high of approximately $52 million
- Despite the challenges during the quarter, Adjusted EBITDA surged by 112% to $5.3 million, representing 17% of revenues (compared to approximately 15% in the corresponding quarter)
- At the beginning of the month, the Company completed the acquisition of the gummy manufacturing operations in the US from P&L Developments, providing it with a physical foothold in the Company's primary target market and entry into the pharma sector
- The Company estimates that the strategic steps it has taken in recent years may support, in the coming years, annual revenues of over $250 million in the dietary supplements segment alone, alongside Adjusted EBITDA of over 20%
SDEROT and RAMAT GAN, Israel, May 26, 2026 /PRNewswire/ -- TopGum Industries Ltd. (TASE: TPGM), the leading company in the gummy-format dietary supplements market, published its financial results for the first quarter of 2026 and reports another record quarter. The Group's revenues amounted to approximately $31.9 million - an all-time high - representing an increase of about 85% compared to the first quarter of 2025, driven by a triple-digit surge of 162% in the dietary supplements segment. These results were achieved despite the war with Iran and the tension that preceded it during most of the reporting period, the fact that the Company is in the process of transferring its manufacturing operations in Israel to its new facility, a sharp weakening of the US Dollar exchange rate against the Israeli Shekel (NIS), and the tariffs imposed on Israeli products exported to the US. The Company estimates that it will continue its growth trend in its global operations, alongside maintaining a high level of profitability.
Dietary Supplements Continue to Drive Growth
The dietary supplements segment recorded revenues of approximately $25.8 million in the quarter, a sharp triple-digit growth of about 162% compared to the corresponding quarter last year (in which the results of the operations acquired in Canada were not yet consolidated). The segment's revenues now constitute about 81% of the Group's total revenues, compared to only about 57% in the corresponding quarter last year and only about 5% in 2019 - the year the Group began its operations in this field. The order backlog in the supplements segment intended for delivery in the coming 4-5 months reached a record of approximately $52 million, compared to about $36 million at the corresponding time last year, reflecting the strong demand from the Group's customers and the trust in its global manufacturing layout. The dietary supplements sector is expected to continue to constitute the main part of the Group's activities and its central growth engine. In the confectionery segment in Israel, revenues in the quarter amounted to approximately $6.1 million, a decrease of about 18% compared to the corresponding quarter last year, mainly due to the effects of the "Lion's Roar" operation that occurred at the peak of the sales season ahead of the Purim and Passover holidays, as well as increased competition in the local market.
Record Adjusted EBITDA
The Company's Adjusted EBITDA in the quarter amounted to approximately $5.3 million, a triple-digit increase of about 112% compared to the corresponding quarter last year. The Adjusted EBITDA rate amounted to about 17% of revenues - a record rate for the first quarter, compared to 15% in the corresponding quarter. These results were achieved despite the "Lion's Roar" operation and the tension that preceded it during most of the reporting period, a sharp weakening of about 13% in the US Dollar exchange rate against the Shekel, tariffs imposed on Israeli products exported to the US, and the fact that the Company is in a period of operational inefficiency due to the transfer of manufacturing operations in Israel to its new facility.
Gross profit increased by about 59% to approximately $9.1 million, compared to $5.7 million in the corresponding quarter last year. Gross margin was mainly affected by the commencement of depreciation of the Company's new facility in Sderot, alongside other factors that do not reflect the Company's long-term operational structure: transition and ramp-up costs between the manufacturing sites in Israel, the impact of the weakening US Dollar, and tariffs on Israeli product exports to the US. The Company estimates that upon completion of the transition and stabilization of operations at the new facility, a gradual improvement in operational efficiency and profit margins is expected starting from the second half of 2026. Net income amounted to approximately $3.4 million, compared to $1.2 million in the corresponding period last year - a triple-digit surge of 211%.
- Eyal Shohat, Chief Executive Officer, TopGum, commented:
"We are pleased to open 2026 with the best quarter in the Company's history, in direct continuation of TopGum's accelerated growth trend in recent years. The strong results in the quarter, achieved despite a challenging business and operational environment, demonstrate the Company's resilience and capabilities.
The orders backlog, which reached a record high of approximately $52 million, reflects strong demand from our customers and their trust and confidence in the Company. The completion of the acquisition of the US operations is a significant strategic milestone, providing us with a manufacturing presence in our primary target market and positioning us as pioneers in the emerging market of pharmaceutical gummies.
We are entering into the next stage in the Company's development with a broader global infrastructure, advanced manufacturing capabilities, and a significant growth platform for the coming years. We estimate that we will continue the growth trend in the dietary supplements segment, alongside a gradual improvement in profitability margins beginning in the second half of 2026 and even more so in the following years."
Strategic Milestone: Entry into the US and Pharma Market
After the reporting period, the Company completed the acquisition of manufacturing operations in the US from P&L Developments, one of the leading generic pharmaceutical companies in the US. The acquisition provides TopGum with a unique foothold in the field of pharmaceutical gummies and expands its presence and manufacturing capabilities in North America, its primary target market, following the acquisition of operations in Canada carried out last year. As part of the transaction, a long-term strategic cooperation was also signed with the seller, who will serve as the exclusive distributor of TopGum products to leading retail chains in the US under their private labels.
The Company estimates that the strategic steps it has taken in recent years, including expanding production capacity, establishing the new facility in Israel, building global infrastructure, and acquiring operations in Canada and the US, are expected to support annual revenues of over $250 million in the dietary supplements sector alone in the coming years, alongside an Adjusted EBITDA of over 20%. In parallel, the Group continues to invest in organic growth by building and establishing global management infrastructures and capabilities, expanding the sales and marketing network, recruiting new customers, and continuously optimizing the supply chain, while continuing to evaluate further strategic acquisitions as part of its preparations for the continued expansion of its operations in international markets and strengthening its position as one of the leading companies in its field.
About TopGum
Founded in 2004, TopGum is a global leader in the manufacturing of dietary supplements in gummy dosage form, with products sold worldwide. The Group's manufacturing facilities are located in Israel, Canada, and the US. TopGum employs more than 400 people and is listed on the Tel Aviv Stock Exchange. The Company's CEO is Mr. Eyal Shohat, and its Chairman of the Board is Mr. Raviv Zoller. The Company's founders are Mr. Hai Hayon, who also serves as President of the Company, and Mr. Roi Lusternik.
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SOURCE TopGum Industries Ltd.
