Better, softer, yummier…is this newly reformulated Quest Bar a gamechanger in sustaining market leadership in the active nutrition snacking category? In this latest episode, I'll utilize the 2023 Q1 Simply Good Foods Company (NASDAQ: SMPL) earnings report, earnings call, and supplemental presentations that were filed on 1/5/2023 as the backdrop to provide broad nutritional snacking market insights. In Q1 of fiscal 2023, both Atkins Nutritionals and Quest Nutrition performed in the top-tier of categorical competitors in retail takeaway, with Quest Nutrition specifically having strong YoY growth at slightly more than 25%. What's at the heart of the Quest Nutrition success? While the Quest Nutrition snacks segment (e.g. Quest Chips, Quest Cookies, Quest Peanut Butter Cups, etc.) is now nearly 45% of measured channel retail sales for the brand...Quest Nutrition is still known for the original Quest Bar. That means the company needs the bar business to be healthy for any of this innovation risk to make sense. Here’s the good news…the core bar business is growing. In fact, this quarter it had tracked channel retail takeaway growth in the quarter of 16.8%. What’s at the heart of that? Well…obviously in this current environment there’s price inflation, but ex-inflation…what’s the volume growth coming from? The classic Quest Bar recently went through a major upgrade. From my understanding, they worked with the global dairy nutrition company Fonterra on a proprietary protein innovation that provides a softer bar and will also yield a longer shelf life of softness which significantly improves the eating experience. I still haven’t gotten my hands on some of the new Quest Bars yet, but leadership did note that the Quest Bar retail takeaway growth was stemming from a direct response to consumers enjoying the reformulation. It’s still early…maybe ~6 months since the earliest new Quest Bars hit the market, so not going to 100% say all is clear, but if the upgrade does prove successful, it will take away one of the largest consumer pain points with Quest Bars and provide a sustained uptick in sales for the market leader. Also...for the final part of the content, I ran through a few headwinds and tailwinds that The Simply Good Foods Company (and competitors) will be facing in the coming year with a high likelihood of a recession.

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