Flowers Foods (FLO) stock tumbled 5.27% in pre-market trading on Friday following the release of its first-quarter 2025 financial results, which fell short of analyst expectations. The bakery company reported disappointing figures, highlighting challenges in its core business.

According to the company's report, Flowers Foods' Q1 adjusted net income came in at $73.7 million, significantly below the $80.1 million estimated by analysts. The company's net sales decreased by 1.4% to $1.554 billion, while net income plummeted by 27.4% to $53.0 million, accounting for just 3.4% of sales. This substantial decline was primarily attributed to reduced sales, higher selling, distribution, and administrative (SD&A) expenses, and increased interest expenses.

Despite the acquisition of Simple Mills contributing $24.3 million to net sales, it resulted in a net loss of $4.2 million. The company's outlook for fiscal year 2025 indicates expected net sales between $5.297 billion and $5.395 billion, reflecting a growth of 3.8% to 5.7% compared to the previous year. However, excluding the Simple Mills acquisition, the projected growth range narrows to -0.5% to 1.3%, suggesting ongoing challenges in the company's core operations. Investors appear to be reacting negatively to these results, as reflected in the pre-market stock plunge.