BioHarvest (BHST) Q3 2026 earnings review
BioHarvest's sales fell 13%, and the company needs new money
BioHarvest, the maker of VINIA red-grape supplements, sold less and lost more as it prepares fragrance production. Revenue fell 13% from a year ago. Chief executive Zaki Rakib said the drop was planned, because BioHarvest cut spending on less profitable new VINIA customers. By our math, the new outlook has fourth-quarter sales 17% below last year's.
| Revenue | $7.9M −13% from a year ago |
|---|---|
| Cash and bank deposits | $12.5M $16.2M at the end of June |
| Loss before depreciation and share pay | $2.0M $0.4M a year ago |
| Full-year sales outlook | Cut to $32–33.5M $37–40M three months ago |
⚖️ Verdict: 🔴 Bearish
The story got worse because BioHarvest now warns it needs new money to keep operating. Cash dropped by $3.7 million in the quarter, to $12.5 million. The better news: VINIA kept its margin after a price rise, and fragrance production could still start early next year.
The question now is whether VINIA growth and fragrance sales arrive before the cash runs out. If they do, losses could narrow without a large share sale; if not, BioHarvest will need outside money first. VINIA's first-quarter sales and the year-end cash balance will tell.
🐂 Bull Case
VINIA Kept Its Margin After a Price Rise
In June BioHarvest raised prices for VINIA, its red-grape supplement sold to online subscribers, by up to 20% for new buyers. Chief executive Zaki Rakib said he would grow the brand "with better economics" instead of chasing sales.
The margin held after the price rise. Making and shipping VINIA cost 43.4% of its sales, against 44.1% a year ago. The unit's loss before depreciation and share pay narrowed slightly from the second quarter.
That matters because BioHarvest needs each order to pay its way. It kept its full-year loss forecast for VINIA unchanged, the only 2026 line it did not cut.
What to watch: VINIA's gross margin in the first quarter of 2027, when Rakib expects growth to return. A steady margin with rising sales would show that customers accepted the new price.
Israeli Grants Pay for Part of the Research
The Israel Innovation Authority, a government agency that funds research, backs two BioHarvest projects. One expands factory capacity, and the other uses AI to monitor production. BioHarvest repays the money only through royalties of 3% to 5% on sales the projects generate.
In July the agency paid about $495,000 up front for the AI project. It covers up to 60% of that project's budget and 40% of the factory project's eligible costs.
This matters because every grant dollar is one BioHarvest does not have to raise by selling shares. But the sums are small next to what the business spends each quarter, so grants reduce the outflow without ending it.
What to watch: further advances in the fourth-quarter cash flow statement. Regular payments would shrink the amount BioHarvest must raise before fragrance sales begin.
🐻 Bear Case
VINIA Sales Fell, and Its Loss Grew
Near the end of the second quarter, BioHarvest cut back on what it calls "lower-return customer acquisition" for VINIA, its red-grape supplement sold online. Chief executive Zaki Rakib said: "These changes have resulted in a moderate decline in revenue, which we anticipated as part of our sales and marketing efficiency initiatives."
- VINIA sales: $7.8 million, down 6.3% from a year ago
- Sales and marketing: 50.2% of VINIA sales, against 48.7% a year ago
- Loss before depreciation and share pay: $627,000, against $249,000 a year ago
The quarter does not show the promised efficiency yet. Marketing spending shrank more slowly than sales, so the unit's loss more than doubled even though its gross margin held steady.
BioHarvest also cut its VINIA sales forecast for the year a second time. By our math, the new range leaves about $7.3 million for the fourth quarter, under the third quarter's level.
What to watch: VINIA sales in early 2027. Rakib expects the benefits, and renewed growth, "beginning in the first quarter of 2027". Another decline then would mean the spending cut shrank the customer base instead of improving it.
Development Work Stalls as One Fragrance Deal Dominates
BioHarvest's CDMO unit develops and grows plant compounds for other companies. In August it signed its first manufacturing contract, with a UAE-based customer that expects to buy 20 tons of a rare fragrance ingredient. BioHarvest estimates the deal at $20–30 million of revenue for 2027–2028.
To speed up that work, BioHarvest cited "the need to accelerate the development for the rare fragrance composition" for higher research costs. It also said it will start fewer new projects this year.
- Revenue from outside clients: $24,000, against $699,000 a year ago
- Gross margin of the unit: minus 8.8%, against 29.1% a year ago
- Full-year loss forecast for the unit: $4–5 million, against $1.5–2.5 million three months ago
This matters because the unit now depends on one buyer. BioHarvest's own risk section says "near-term CDMO prospects depend largely on one customer". The second development stage, begun in May, still has to finish, and larger output waits on factory capacity that BioHarvest now plans to add in phases.
What to watch: whether limited fragrance production starts in the first quarter of 2027, as BioHarvest expects. A delay would extend a stretch of high costs and almost no outside revenue.
BioHarvest Says It Needs New Money to Continue
After its second quarter, BioHarvest said it had adequate resources for the foreseeable future. Its third-quarter statements reverse that view. They cite "substantial doubt about the Company’s ability to continue as a going concern" and say BioHarvest "will require additional capital to fund its operations".
- Cash and bank deposits: $12.5 million, against $16.2 million in June
- Cash used in the quarter: $3.7 million, after $3.9 million in the second quarter
- Free cash flow: minus 37% of revenue, against minus 28% a year ago
- Full-year loss forecast before depreciation and share pay: $5.5–7.5 million, against $3–5 million three months ago
At the third-quarter pace, the cash covers a little over three quarters, by our math. BioHarvest widened its loss forecast for a second straight quarter, after missing its 2025 break-even target. It expects fragrance revenue no earlier than 2027, so new money must come from shares, debt, partners or licensing, the routes its statements list.
What to watch: the year-end cash balance and any financing announced with fourth-quarter results. A share sale before fragrance revenue starts would add to the shares BioHarvest issued in 2025.
Risks this quarter didn't answer
Three standing risks outside BioHarvest's control got no new figures in this quarter's materials, so each still waits for a specific reading.
- Operations in Israel: the ceasefire agreed in April still holds, and BioHarvest reports no material impact; any stoppage at the Rehovot or Yavne sites would show in output.
- US tariff on Israeli-made material: the materials give no cost figure; a change in VINIA's gross margin would show it.
- Nasdaq listing rules: the materials report no notice from the exchange; a notice would be the reading.
👓 Other Themes
Three Priorities: Cash, Steadier VINIA, Fewer Projects
Chief executive Zaki Rakib set three priorities: protect cash, grow VINIA, its grape supplement, profitably, and finish three advanced development projects. BioHarvest plans to add factory capacity "gradually, in phases aligned with demonstrated demand" and to trim fixed costs through "consolidation of development sites in 2027". New business will center on "licensing our unique molecules’ assets". The plan carries no savings figure.
VINIA Daily Chews Went on Sale in September
BioHarvest launched single-dose VINIA Daily Chews in September, a chewable form of its red-grape supplement. It calls the format "an additional pathway for customer acquisition, retention, market expansion and revenue growth". The chews reached customers late in the quarter, so their sales do not show yet.
Tel Aviv Listing and a Small Buyback
BioHarvest's shares began trading on the Tel Aviv Stock Exchange in September, alongside Nasdaq. The board approved a share buyback in late September, and BioHarvest bought back 6,062 shares after the quarter. It also repaid $250,000 of investor loans early in November. The sums are small, but both spend cash while its statements warn of a funding need.
💲 Other KPIs
Stock on hand kept climbing while sales fell: inventory reached $6.2 million, up 39% from a year ago. Over nine months the build used $1.6 million of cash. Inventory now equals 79% of a quarter's sales, against 49% a year earlier.
Money owed by customers nearly doubled from a year ago, to $2.7 million, even as revenue fell. The balance eased from $2.9 million in June. Trade receivables are bills customers have not yet paid, so a larger balance against shrinking sales holds back cash.
The share count has not moved since December, after the 2025 share sales and loan conversions lifted it 30% from a year ago. Share-based pay tripled to $398,000 in the quarter. Options outstanding reached 2.54 million, from 1.98 million at the start of the year.
🔮 Guidance
Cut. The plan now has revenue about 5% below last year. By our math, that leaves about $7.5 million for the fourth quarter. That would be 17% below a year ago, and a further step down from the third quarter. It is the second cut running; the middle of the range dropped $6.5 million at the second-quarter results and $5.75 million now.
Cut. BioHarvest now expects VINIA, its online supplement business, to sell less than it planned three months ago. By our math, the range leaves about $7.3 million for the fourth quarter, below the $7.8 million sold in the third. The plan set in March called for $38–42 million, so this is the second cut.
Unchanged. The supplement business still expects to lose $1.5–2.5 million on this measure, which leaves out depreciation and share pay. By our math, nine-month losses of $1.6 million leave about $0.4 million for the fourth quarter. That would require the unit to cut its quarterly loss by about a third.
Cut. The unit that develops plant compounds for other companies now expects $1–1.5 million in outside revenue, about a quarter of its earlier plan. It booked $1.04 million in nine months, so by our math the fourth quarter adds between nothing and $0.46 million. BioHarvest said it will start "fewer new projects than expected" because the fragrance contract needs faster work.
Cut. The development unit now expects a loss more than twice the size it forecast three months ago. It lost $3.2 million on this measure in nine months, so by our math the fourth-quarter loss lands near $1.3 million. BioHarvest tied the change to faster fragrance development. The range is back where the March plan put it.
Cut. The full-year loss on this measure now runs nearly twice last year's $3.6 million. By our math, nine months used $4.8 million of the range, leaving about $1.7 million for the fourth quarter. The range has widened at each of the last two updates, from $3–4 million set in March.
Unchanged. BioHarvest still estimates the 20-ton fragrance contract at $20–30 million of revenue over two years. It said limited production could begin as early as the first quarter of 2027. The second development stage, started in May, should take six to nine months, so the timetable leaves little slack.
❓ Key Questions
How long will the cash last without new funding?
BioHarvest's statements now cite substantial doubt about its ability to continue. Readers need the minimum cash balance management plans to hold, and whether a share sale, debt or a partner deal comes first.
How many active VINIA customers are there now?
The count, about 95,000 in July, did not appear in this release. It is the clearest sign of whether the spending cut is losing subscribers or only dropping unprofitable ones.
What does the fragrance customer pay, and when?
BioHarvest estimates $20–30 million from the contract but has not given a delivery schedule, a price per kilogram or royalty terms. Those terms decide how soon the deal turns into cash.
When will the new factory be built, and at what cost?
BioHarvest now plans to add capacity in phases tied to demand. The release gives no budget or start date, and the fragrance volumes depend on larger production.
Does BioHarvest still aim to break even in 2027?
Three months ago management pointed to break-even in 2027 on its preferred loss measure. This release does not repeat the target, while the 2026 loss forecast widened again.