Where Food Comes From (NASDAQ:WFCF) reported a 4% increase in third-quarter revenue to $7.3 million, as demand for verification and certification services helped lift operating income and margins.
CEO John Saunders said on the company’s earnings call that revenue in its core verification and certification segment grew 6%. He pointed to demand for newer animal welfare standards and organic certification services, even as smaller cattle herds and fewer animals moving through the system continued to pressure the beef industry.
Operating income rose 68% to $1 million from $600,000 a year earlier. Gross margin increased to 42.1% from 38.3%, with gains in both certification and product sales, Saunders said. Selling, general and administrative expenses were flat year over year.
RaiseWell adoption expands
Saunders said the company’s RaiseWell Certified animal welfare standard, introduced in January 2026, has begun to make a meaningful contribution to revenue. Whole Foods Market recognized the standard in February, and in October extended it to cover poultry, pork and lamb supplies, he said.
Whole Foods is a strategically important relationship because of its size and reputation in sustainability, humane handling and food-supply transparency, Saunders said. He noted that the retailer has 540 stores and millions of customers.
At the time of the call, 347,000 cattle had been approved under RaiseWell, with 368 cattle ranchers approved across 26 states, Saunders said. The company also counted 52 backgrounders, 31 finishing locations and four processors among its customers and had recently begun onboarding poultry operations and processors.
Despite record-high beef prices and low herd sizes, Saunders said ranchers were continuing to invest in certifications. Based on customer feedback and video sale data, he said, ranchers were receiving premiums of $100 per head for cattle third-party verified to one or more of the company’s standards.
Saunders said the company remained optimistic about its long-term beef business, citing its newer offerings and its belief that a recovery in the cattle supply cycle is on the horizon.
Organic services and margins
Where Food Comes From now covers more than 1,500 organic operations, representing over 1 million organic acres, Saunders said. The customer count increased by more than 94 through the first nine months of 2026, including more than 30 established operations that transferred from other certification bodies.
Saunders said customers had cited the company’s service, its ability to combine organic and other certifications in a single audit, and its SOW Organic online tool as reasons for choosing its services. He described the tool as an aid for the annual organic certification qualification process.
For the first nine months of the year, gross margin improved to 40.5% from 38.9%, while selling, general and administrative expenses declined 3%, or nearly $200,000. Operating income for the period rose 52% to $1.9 million from $1.3 million.
Saunders said operating income was the most useful measure of profitability because of unusual items below that line, including digital asset valuation swings and a 2025 asset divestiture.
Share repurchases
The company repurchased 21,170 shares in the third quarter, bringing its year-to-date total to 110,651 shares. Saunders said the cumulative value returned to shareholders through the buyback program reached $17.5 million.
No analysts or other participants asked questions during the call’s question-and-answer session.
About Where Food Comes From (NASDAQ:WFCF)
Where Food Comes From, Inc. provides verification, certification, and traceability services for the agricultural and food industries. The company helps producers, processors, retailers, and food brands substantiate claims about how products are raised, grown, sourced, and handled throughout the supply chain. Its services include source and origin verification, sustainability and production-practice audits, animal welfare assessments, organic and non-GMO certification support, and supply-chain data and traceability solutions.
