The Simply Good Foods Company isn’t salty with the recent performance at Quest Nutrition, but it does want more. In this latest episode, I'll utilize the 2024 Q1 Simply Good Foods Company (NASDAQ: SMPL) earnings report, earnings call, and supplemental presentations that were filed on 1/4/2024 as the backdrop to provide broad nutritional snacking market insights. In Q1 of fiscal 2024, both Atkins Nutritionals and Quest Nutrition performed well against the categorical competitors in tacked channel retail takeaway, with Quest Nutrition specifically having strong YoY growth at 20%. What's at the heart of the Quest Nutrition success? 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 year it had tracked channel retail takeaway growth of 16%. Additionally, Quest Nutrition has proven it's one of the few brands that can successfully extend across multiple product forms...and its customer base expects them to come into an indulgent snacking category and flip it into great tasting offerings that are higher in protein (and lower in the stuff that you don’t want like carbs and sugar). The snacks segment of Quest Nutrition, which now accounts for about 45% of all measured channel retail sales, saw retail takeaway growth increase 24%. But if we take this one layer deeper…the salty side of the Quest snacks segment had quarterly retail takeaway growth of about 45%. Quest chips now make up just over 20% of the total Quest Nutrition revenue. Furthermore, around 30% of new users to the brand have come from chips. Salty snacks are where I’d argue the most excitement lies, but it’s just one bullish brand layer stacked on many other categorical ones within the Simply Good Foods Company. I think most people forget about how innovative Quest Nutrition has been since the very beginning of the brand, and its constant product innovation that has been a key driver of new buyers into the brand and increased the household penetration. So, I'd expect Quest Nutrition to be eying up several sizable conventional salty snack categories that have multichannel potential. Finally, I run through the what all the weak brand performance at Atkins Nutritionals means and what actions the company is taking to change it…especially against the backdrop of GLP-1 weight loss solutions. As part of the new CEO’s assessment of what is needed to unlock the high potential of the Atkins Nutritionals brand, a comprehensive revitalization plan was developed based on extensive consumer research.

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