HF Foods Group Shines in Q1 2026: Strong Revenue Growth, Digital Transformation, and Cross-Selling Strategy
HF Foods Group, a leading player in the food service industry, has reported an impressive set of results for its first quarter (Q1) 2026 earnings. Despite headwinds from tariff pressure, lower foot traffic, and rising fuel prices, the company demonstrated strong revenue growth, digital transformation, and a cross-selling strategy that positions it well for future success.
In Q1 2026, HF Foods Group's net revenue increased by 4.5% year-over-year to $312 million, driven by higher volume. While gross profit decreased slightly to $50.5 million due to a higher mix of Seafood during the quarter, Adjusted EBITDA still managed to increase by 3.8% year-over-year to $10.1 million.
One of the key highlights from the quarter was the company's progress on its long-term transformation plan. This included consolidating two sales call center operations into one unified team, providing better control over the overall sales process and improved customer service while maintaining distinct connections with customers through their understanding of business, language, and product needs.
Furthermore, HF Foods Group successfully implemented its Enterprise Resource Planning (ERP) system, which positions it to achieve higher levels of purchasing efficiency by consolidating buying across distribution centers. The new system also enables operational improvements through enhanced route optimization capabilities, recategorizing a significant number of SKUs as part of the implementation.
The next phase of the company's digital transformation focuses on improving overall customer experience through the development of a customized customer portal that will enable transactional visibility and improve efficiency. This follows the consolidation of sales call center operations into one unified team, which has already shown significant efficiency gains in lower SG&A spend on sales commissions.
In terms of facilities upgrades, HF Foods Group successfully completed the acquisition of its previously leased facility in Chicago, expanding cooler and ambient capacity as part of a broader cross-selling strategy. The Charlotte facility is nearing completion, with operations expected to begin in late Q2 or early Q3 2026, which will shorten Seafood distribution routes in the Southeast.
Additionally, the company is kick-starting phase II of Atlanta's freezer expansion plan, nearly doubling cold storage capacity in the market from 10,000 to 20,000 square feet. This upgrade is expected to be operational by the end of 2026 and reflects the ongoing commitment to optimizing distribution networks for sustainable growth.
The success of HF Foods Group in Q1 2026 serves as a testament to its resilience and strategic focus on digital transformation and cross-selling strategy. The company's strong revenue growth, combined with significant investment in facilities upgrades, positions it well for future success in the food service industry.
