How will the 11% YoY revenue increase and 24% growth in Zola® affect Arcadia's earnings guidance and valuation?

Fundamentals & Earnings Guidance

The 11 % YoY revenue lift—driven almost entirely by a 24 % jump in Zola® sales—signals that Arcadia’s flagship plant‑based protein platform is gaining traction in a rapidly expanding market. Management will likely upgrade its Q3‑Q4 2025 earnings guidance, especially on the top‑line, because Zola’s margin contribution is higher than the company’s legacy products. Assuming Zola continues to deliver its current gross‑margin profile (~55‑60 % after scale‑up), the incremental revenue could add roughly $6‑8 million of contribution profit in the full year, enough to push EPS estimates up 15‑20 % versus the prior consensus. Investors will also watch the newly acquired 2.7 M ABVE shares; the equity stake may be accounted for as a non‑operating gain or strategic upside, further bolstering guidance revisions.

Valuation & Trade Implications

The market is already pricing in a modest upside (sentiment 70), but the earnings upgrade potential could expand the forward P/E multiple from roughly 12× to 14‑15×, aligning Arcadia with its peer group of specialty food & agritech firms. Technically, RKDA is trading just above its 50‑day EMA and has held a bullish flag on the daily chart; a breakout above the recent high (~$2.20) with volume would confirm the earnings‑driven catalyst and could push the stock toward the next resistance at $2.60. A short‑term trade plan: buy on a pull‑back to the 20‑day EMA (~$1.95) with a stop just below the 200‑day SMA (~$1.70) and target the $2.30–$2.50 range pending the earnings release. If the guidance upgrade is muted, the stock may revert to its mean and retest support, offering a contrarian entry point for risk‑averse traders.