BAB, Inc. reported fiscal year‑ended November 30, 2025 results that showed a 3.2% decline in revenue to $3.439 million, down from $3.545 million in 2024. The drop was largely driven by a 48.3% decline in franchise fee revenue to $15 000 after a single store transfer, while royalty and licensing income remained steady, keeping the overall revenue mix stable.
Net income increased to $559 000, up 6.8% from $525 000 in the prior year, and earnings per share rose to $0.08 from $0.07. The improvement was driven by disciplined cost management, including a $79 000 benefit reduction as employees transitioned from a company health plan to Medicare and a $35 000 cut in marketing fund expenses.
Operating income climbed to $722 000 from $665 000, reflecting the benefit and marketing fund reductions. Operating margin expanded as the company leveraged its franchise and licensing model to offset the revenue decline, demonstrating effective operational leverage.
Payroll costs rose modestly by $7 000 and advertising expenses increased by $2 000, but these increases were outweighed by the larger savings from benefit and marketing fund cuts. The company’s franchise and licensing model continued to generate stable royalty and fee income, underscoring the resilience of its core business.
Management highlighted the importance of cost discipline and strategic investments in high‑return verticals, signaling confidence in maintaining profitability amid a slightly weaker revenue environment. The company’s net cash position of $1.68 million provides a solid balance‑sheet foundation for future growth initiatives.
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