Cyanotech Corporation (CYAN): Business Model Canvas [Dec-2025 Updated]

Honestly, looking at the structure for Cyanotech Corporation as of late 2025, you see a company walking a financial tightrope, which makes their operational focus defintely critical. They are fundamentally selling premium, Hawaiian-grown microalgae-BioAstin® and Hawaiian Spirulina Pacifica®-both as high-growth bulk ingredients (which saw sales jump 74% and 53% respectively) and through their Nutrex Hawaii consumer line, netting total net sales of $24,215,000 for the year. But here's the rub: that revenue came with an operating loss of $2,508,000 and left them with just $257,000 in cash, meaning every key partnership and activity is geared toward disciplined cost control right now. Dive into the full canvas below to see exactly how their premium value proposition is trying to outrun those near-term cost pressures.

Cyanotech Corporation (CYAN) - Canvas Business Model: Key Partnerships

You're looking at the core relationships Cyanotech Corporation maintains to get its high-value microalgae products to market, which is critical given the concentration risk we see in their sales base. Honestly, these partnerships are the backbone for scaling production and distribution.

For the fiscal year ended March 31, 2025, the company reported total net sales of $24,215,000. This revenue stream is heavily reliant on a few major players.

Key B2B Customers Concentration (FY2025)

The customer concentration is a significant factor in the Key Partnerships block. For the fiscal year ended March 31, 2025, two customers individually accounted for substantial portions of the total revenue.

The combined revenue from these two customers alone was 41% of the total net sales for FY2025. This level of reliance means maintaining strong relationships here is paramount.

Manufacturing and Ingredient Partners

Cyanotech Corporation relies on external partners for certain manufacturing steps, particularly for finished goods, ensuring compliance with regulatory standards.

• All third-party contract manufacturers must comply with FDA GMP regulations.
• These contract manufacturers hold independent third party GMP certifications.
• BioAstin®, sold in liquid lipid form as a raw ingredient, goes to dietary supplement manufacturers, health food formulators, and cosmetic manufacturers.
• Contract extraction and R&D services revenue was approximately 4% of net sales for the fiscal year ended March 31, 2025, up from 3% in the prior year.

The cost of sales related to these contract extraction and R&D services was $634,000 for the year ended March 31, 2025.

Distribution Network

Getting the finished packaged Nutrex Hawaii products and bulk ingredients to the end-user involves a network of specialized partners.

Cyanotech Corporation utilizes global distributors for its packaged Nutrex Hawaii products, which compete in the highly competitive dietary supplement category. Furthermore, in selected international markets, the company has exclusive sales distributors covering both bulk and packaged consumer products.

The distribution channels for the two main product lines in FY2025 were:

• BioAstin® (65% of FY2025 Net Sales): Sold as packaged consumer product through Nutrex Hawaii to natural product distributors, retailers, and online channels, or directly to consumers.
• Hawaiian Spirulina Pacifica® (32% of FY2025 Net Sales): Sold as powder and tablets, and the newer gummies, through similar channels.

Finance: draft 13-week cash view by Friday.

Cyanotech Corporation (CYAN) - Canvas Business Model: Key Activities

You're looking at the core engine of Cyanotech Corporation, the actual work that turns sunlight and seawater into their high-value ingredients. This is where the real operational leverage happens, especially as they push for better margins.

Cultivation and harvesting of microalgae at the Kona facility.

Cyanotech Corporation operates its entire business from a single, specialized location. This activity centers on maintaining the optimal environment for their microalgae strains.

• Production site covers 96-acre facility on the Kona Coast of the island of Hawaii.
• Uses access to cold deep ocean water, drawn from an offshore depth of 2,000 feet, for the Ocean-Chill Drying system.
• The location is designated a Biosecure Zone, free of genetically modified organisms (GMOs).
• The goal is to permit year-round harvest in a cost-effective manner using proprietary technology.

Managing proprietary production technology and R&D.

The company's expertise is in developing efficient, stable, and cost-effective production systems. This is reflected in their R&D spending and the revenue derived from leveraging this know-how for others.

Here's the quick math on R&D investment and service revenue for the fiscal year ended March 31, 2025:

What this estimate hides is that while R&D spending dropped, the efficiency gains in core production drove the overall gross margin up to 28.4% in FY2025 from 25.8% the prior year.

Global bulk ingredient sales and distribution.

A significant portion of Cyanotech Corporation's activity involves selling raw, high-value ingredients to other manufacturers. This segment showed massive growth in the fiscal year ended March 31, 2025, offsetting slower consumer brand sales.

Sales mix and growth for the fiscal year ended March 31, 2025, compared to the prior year:

This trend continued into the first quarter of fiscal 2026, where bulk spirulina and bulk astaxanthin sales increased by 48% and 49% respectively, year-over-year. The overall net sales for the trailing twelve months ended September 30, 2025, reached $25,269,000.

Marketing and sales for the Nutrex Hawaii consumer brand.

This involves direct-to-consumer sales through retail and online channels, primarily under the Nutrex Hawaii banner. This channel faced headwinds in the 2025 fiscal year.

• Packaged sales saw a 5% decline in fiscal year 2025.
• Packaged product sales declined by 12% in the first quarter of fiscal 2026 compared to the prior year.
• The company hired a Head of Sales to focus on deeper channel expansion.

Still, online channels showed strong performance in the second quarter of fiscal 2026, and price increases on Nutrex-brand products helped margin expansion.

Disciplined cost control and expense management.

Managing costs is a critical activity, especially given the historical operating losses. Management focused on driving efficiencies to improve the bottom line, which showed results across 2025.

• Total expenses saw an 11% improvement from the prior year in fiscal 2025.
• Operating loss for fiscal year 2025 was $2,508,000, reduced by almost 45% from the fiscal 2024 operating loss of $4,592,000.
• Operating expenses remained flat in the first quarter of fiscal 2026 compared to the same period last year.
• Gross profit margin improved to 34.3% in the second quarter of fiscal 2026, up from 25.3% in the second quarter of fiscal 2025.

Finance: draft 13-week cash view by Friday.

Cyanotech Corporation (CYAN) - Canvas Business Model: Key Resources

You're looking at the core assets that let Cyanotech Corporation actually grow its microalgae and sell its specialized nutrition products. These aren't just things on a balance sheet; they are the physical and intellectual foundation of the business, especially given the unique location requirements.

The most tangible asset is the production site itself. Cyanotech Corporation operates a 96-acre open-pond cultivation facility in Kona, Hawaii. This location is key because it offers consistent warm temperatures and high solar insolation, which are necessary for optimal microalgae growth. Furthermore, the facility benefits from access to cold deep ocean water, drawn from an offshore depth of 2,000 feet, which is used in their Ocean-Chill Drying system. The growing area is also designated as a Biosecure Zone, meaning it is free of pesticides and herbicides.

The intellectual property and know-how are just as critical as the land. Cyanotech Corporation relies on its proprietary microalgae cultivation and extraction technology. This expertise, developed over decades, allows for the commercially viable production and harvesting of their specific microalgal products. This technology is what helps them maintain quality and cost-effectiveness in a challenging agricultural environment.

The brand equity tied to the products grown at this facility represents significant intangible resources. Cyanotech Corporation owns the established brands:

• BioAstin® Hawaiian Astaxanthin®
• Hawaiian Spirulina Pacifica®

To give you a sense of scale and recent performance tied to these resources, here are some key figures from the Fiscal Year 2025 (ended March 31, 2025):

Human capital is another essential component. As of March 31, 2025, Cyanotech Corporation employed 83 people. You can break down that team by function:

• 32 employees involved in harvesting, production, and quality control.
• The remainder in maintenance, shipping, sales, administration, and support.

Finally, the financial resources available at the end of the fiscal year dictate immediate operational flexibility. For the period ended March 31, 2025, the reported figures were:

• Working capital of $302,000.
• Cash on hand of $257,000.

Finance: draft 13-week cash view by Friday.

Cyanotech Corporation (CYAN) - Canvas Business Model: Value Propositions

You're looking at the core reasons customers choose Cyanotech Corporation (CYAN) over the competition. It boils down to where the product is grown, what it is, and the deep expertise behind it. Honestly, the Hawaiian origin is a massive part of the perceived value.

Premium, all-natural microalgae products from Hawaii form the foundation. Cyanotech Corporation produces its offerings from microalgae grown at its 96-acre facility in Kona, Hawaii. This location is key, as Kailua-Kona, Hawaii, receives more sunlight than any other US coastal location, allowing for continuous year-round spirulina cultivation. The growing media uses a combination of pure, fresh water from Hawaiian aquifers and supplemental deep ocean water. The company emphasizes that its products are cultivated without herbicides or pesticides and are non-GMO.

The product mix clearly shows where the revenue value is concentrated, based on the fiscal year ended March 31, 2025:

BioAstin® offers superior antioxidant activity for joint and eye health. This natural astaxanthin product, first introduced to the market in 1999, is specifically cited for supporting skin, eye, and joint health, along with recovery from exercise. The antioxidant properties of astaxanthin are believed to surpass those of vitamin C, vitamin E, beta-carotene, and other carotenoids. The company has been producing natural astaxanthin commercially since 1997.

Hawaiian Spirulina Pacifica® is a nutrient-rich superfood. Cyanotech Corporation has been producing this strain of Arthrospira platensis since 1984. It is positioned as a highly absorbable, plant-based source of key nutrients. You can see the concrete nutritional value in a typical daily portion (6 tablets):

• c-phycocyanin: 225mg
• GLA (gamma-linolenic acid): 32mg
• Chlorophyll: 18mg
• Carotenoids: 12mg
• Zeaxanthin: 2.5mg
• Superoxide dismutase (S.O.D): 2,000 units

To put that into perspective for the consumer, one teaspoon is stated to equal 5 serves of fruit and vegetables. The company uses a unique Ocean-Chill Drying process, which takes only 30 minutes, to preserve heat-sensitive nutrients.

The assurance of safety is a critical component. Both major product lines are confirmed to be Generally Recognized as Safe (GRAS). BioAstin® is GRAS as determined by the United States Food and Drug Administration (FDA). Similarly, Spirulina Pacifica® is also GRAS for addition to various foods by the FDA. Furthermore, Hawaiian Spirulina Pacifica® holds the highest, Class A safety rating from the United States Pharmacopeia's Dietary Supplement Information Expert Committee (DSI-EC).

Finally, the value is underpinned by over 40 years of microalgae technology expertise. Cyanotech Corporation states it is a world leader in microalgae technology for more than 40 years. This experience has motivated the design and implementation of proprietary production and harvesting technologies, systems, and processes. For example, they applied for a New Dietary Ingredient (NDI) with the FDA in fiscal 2012 for a daily dosage of 12mg of astaxanthin, which was reviewed without comment. The company's net sales for the trailing twelve months ended September 30, 2025, reached $25,269,000, showing continued market traction for these specialized products.

Finance: review the Q2 FY2026 gross margin of 34.3% against the FY2025 margin of 28.4% to quantify the impact of production efficiency on value delivery.

Cyanotech Corporation (CYAN) - Canvas Business Model: Customer Relationships

You're looking at how Cyanotech Corporation manages its connections with its buyers, which is a mix of direct-to-consumer (D2C) and business-to-business (B2B) channels. The company explicitly stated in its Q2 Fiscal 2026 commentary that total sales growth of 19.3% year-over-year was 'driven by higher bulk sales and strong performance in our online channels.'

Direct-to-consumer sales via the Nutrex Hawaii online platform are a key relationship point. Cyanotech Corporation sells its Nutrex Hawaii packaged consumer products directly online at www.nutrex-hawaii.com. The CEO noted that addressing the 'slower growth of package sales remains a priority' as of Q3 Fiscal 2025, even while bulk sales were driving growth. However, by Q2 Fiscal 2026, the online channels showed strong performance, contributing to the period's 19.3% total sales increase.

B2B account management for large bulk ingredient buyers is critical, as these relationships often involve significant volume. For the fiscal year ended March 31, 2025, two customers individually accounted for 31% and 10% of the total net sales, showing a high degree of concentration in the bulk segment. The majority of bulk spirulina is sold to international health food manufacturers and formulators. The company's strategy involves 'deepening relationships in key e-commerce and bulk ingredient markets' as of Q1 Fiscal 2026.

The structure supporting these relationships involves a dedicated focus on sales management. While specific compensation or headcount for a dedicated Head of Sales isn't public, the company's overall structure supports these efforts. As of March 31, 2025, Cyanotech Corporation employed 83 people in total, with a portion dedicated to shipping, sales, administration, and support.

Building market awareness of the naturally farmed microalgae is a foundational relationship effort, as the CEO stated a priority is 'driving awareness of our naturally farmed microalgae from our farm in Kona, Hawaii.' This awareness underpins both D2C and B2B sales, especially since the BioAstin® product line, which is natural astaxanthin, represented approximately 65% of net sales for fiscal 2025, equating to revenues of $15.7 million.

Here is a look at the sales mix that these customer relationships support for the fiscal year ended March 31, 2025:

The management focus areas for customer relationships include:

• Driving brand value through differentiated storytelling.
• Deepening relationships in key e-commerce markets.
• Deepening relationships in bulk ingredient markets.
• Focusing on sustainable cash flows from relationships.

The company's total net sales for the trailing twelve months ended September 30, 2025, reached $25,269,000, showing the scale of the customer base being managed.

Cyanotech Corporation (CYAN) - Canvas Business Model: Channels

You're looking at how Cyanotech Corporation moves its microalgae products from the Kona farm to the end user as of late 2025. The channels show a clear pivot, with ingredients outpacing finished goods.

The bulk ingredient sales channel, which directly serves nutraceutical manufacturers, saw significant acceleration in fiscal year 2025. Bulk spirulina sales grew by an impressive 53% year-over-year, and bulk astaxanthin sales jumped even higher, increasing by 74% in the same period. This channel is key for moving raw material, with the majority of bulk spirulina going to international formulators who then package the product under their own brand labels.

Conversely, the packaged supplement side of the business, which feeds your Direct-to-Consumer (DTC) efforts, US retail presence, and international distributors, experienced a contraction. Packaged sales saw a decline of 5% in fiscal year 2025. This slower growth in packaged goods remains a priority focus area for management looking ahead. The DTC channel, operating through www.nutrex-hawaii.com, is part of this packaged segment, though specific revenue attribution isn't broken out in the public filings.

To be fair, the overall net sales for the full fiscal year 2025 were $24,215,000, up 5.0% from the prior year, showing that the bulk growth offset the packaged decline. The company's primary products, BioAstin® (astaxanthin) and Hawaiian Spirulina Pacifica®, make up the bulk of the packaged offering, accounting for approximately 65% and 32% of net sales, respectively, in fiscal 2025.

Here's a quick look at the product revenue composition for fiscal year ended March 31, 2025:

You should note the recent shift continuing into the next period, as reported for the first quarter of fiscal 2026, which suggests the ingredients channel strength is persistent:

• Bulk spirulina sales increased by 48% in Q1 FY2026 compared to the prior year.
• Bulk astaxanthin sales increased by 49% in Q1 FY2026 compared to the prior year.
• Packaged product sales saw a 12% decline in Q1 FY2026.
• The company is focused on deepening relationships in the e-commerce and bulk ingredient markets.

The international distribution network is a key outlet for the bulk ingredient sales, but it also handles packaged goods, sometimes in direct competition with the Nutrex Hawaii subsidiary's own international packaged sales efforts. Finance: draft 13-week cash view by Friday.

Cyanotech Corporation (CYAN) - Canvas Business Model: Customer Segments

You're looking at Cyanotech Corporation's customer base as of late 2025, and it's clearly split between large-scale business partners and direct-to-consumer sales through its subsidiary. The business relies heavily on a few key relationships, which is something you always need to watch closely in this sector.

Global Nutraceutical and Cosmeceutical Manufacturers (Bulk Buyers)

A significant portion of Cyanotech Corporation's revenue comes from bulk sales of its microalgae ingredients, like astaxanthin and spirulina, to other manufacturers. These are the global players who take the raw material and incorporate it into their own branded supplements or cosmetic products. For the fiscal year ended March 31, 2025, the company's astaxanthin product line, BioAstin®, represented approximately 65% of net sales, totaling about $15.7 million. Hawaiian Spirulina Pacifica® made up another 32%, or roughly $7.6 million in that same fiscal year. Contract extraction and R&D services, which feed into this manufacturing segment, accounted for about 4% of net sales in fiscal 2025. The recent shift in sales mix shows the importance of this segment; in the second quarter of fiscal 2026, ended September 30, 2025, total sales increased 19.3% year-over-year, driven by higher bulk sales.

Health-Conscious Consumers Seeking Premium Dietary Supplements (Nutrex Hawaii)

This segment is served by Cyanotech Corporation's wholly owned subsidiary, Nutrex Hawaii, Inc. They sell packaged consumer products directly to individuals. In the domestic market, these products move through natural product distributors, retailers, and online channels, or directly to consumers. Management has been focused on this area; for instance, price increases were implemented earlier in the year for the Nutrex-brand products, which contributed to margin expansion in the second quarter of fiscal 2026. However, this channel can be volatile; in the second quarter of fiscal 2025, packaged goods sales actually fell 21% due to stock shortages. Still, the latest results show strong performance in online channels for the second quarter of fiscal 2026.

Formulators Who Re-package and Promote the Hawaiian Origin

This group overlaps with the bulk buyers but is distinct in its marketing focus. These formulators specifically value the Hawaiian origin of the microalgae, which Cyanotech Corporation farms on the Kona Coast. They use this provenance as a key selling point for their own finished goods. In selected international markets, Cyanotech Corporation uses exclusive sales distributors for both its bulk and packaged products, suggesting a reliance on partners who champion the premium, sustainable sourcing story.

Two Major Customers Driving a Significant Portion of Revenue

Concentration risk is a real factor here, as a significant portion of Cyanotech Corporation's revenue and receivables comes from just a few major customers. For the fiscal year ended March 31, 2025, the data shows a clear dependency:

To be fair, this concentration has shifted slightly from the prior year, where the top two customers accounted for 34% and 17% of net sales, respectively. Management noted that changes in sales levels to these largest customers are an important factor that could change future results.

Here's the quick math on the product mix that feeds these segments for fiscal 2025:

• Astaxanthin (BioAstin®): 65% of net sales
• Hawaiian Spirulina Pacifica®: 32% of net sales
• Contract Services/R&D: Approximately 4% of net sales

The total net sales for fiscal 2025 were $24,215,000.

Finance: draft 13-week cash view by Friday.

Cyanotech Corporation (CYAN) - Canvas Business Model: Cost Structure

You're looking at the core expenses that drive Cyanotech Corporation's operations as of late 2025, based on their fiscal year 2025 results ending March 31, 2025. Understanding where the money goes is key to seeing how they manage their high-value microalgae production.

The primary cost area is the Cost of sales for microalgae cultivation and production. This covers everything from growing the algae in Kona, Hawaii, to harvesting and initial processing. For the full fiscal year 2025, this cost component totaled $\mathbf{\$17,339,000}$.

Here's a quick breakdown of the key cost components and related figures for fiscal year 2025:

The company also incurred costs related to specialized services. The Contract extraction and R&D services cost for fiscal year 2025 was explicitly reported at $\mathbf{\$634,000}$. To be fair, this service revenue only represented about $\mathbf{4\%}$ of their total net sales for the year.

When you look at the bottom line, the Operating loss was $\mathbf{\$2,508,000}$ in fiscal 2025. That's an improvement, as it was reduced by almost 45% compared to the prior year's operating loss of $\mathbf{\$4,592,000}$.

Regarding Sales, general, and administrative expenses (SG&A), the exact total for FY2025 isn't itemized separately in the same way as Cost of Sales, but we know the company has been actively managing this area. Cost control measures implemented included:

• Maintaining a reduced headcount and compensation.
• Eliminating certain discretionary selling, general and administrative expenses.
• Making changes in the sales and marketing team.

Finally, you need to factor in external pressures. Management noted that costs were impacted by potential new tariffs and economic uncertainty. This is a near-term risk that management is focused on navigating by staying flexible and managing expenses tightly.

Finance: draft 13-week cash view by Friday.

Cyanotech Corporation (CYAN) - Canvas Business Model: Revenue Streams

You're looking at Cyanotech Corporation's revenue streams as of late 2025, which clearly shows a significant pivot toward ingredient supply. The foundation of the revenue model rests on two primary microalgae products: Astaxanthin and Spirulina.

Total Net Sales for Cyanotech Corporation for the fiscal year ending March 31, 2025, reached $24,215,000. This represented a 5.0% increase from the prior fiscal year's net sales of $23,071,000. That's solid top-line growth, driven by specific segments.

The revenue streams are segmented across product types and sales channels. The primary revenue drivers are:

• Bulk ingredient sales of Astaxanthin and Spirulina to manufacturers.
• Packaged consumer product sales under the Nutrex Hawaii brand.

The growth story for fiscal year 2025 was definitely in the bulk channel. Bulk sales of Astaxanthin saw a substantial growth of 74%, and bulk Spirulina sales grew by 53%. This strong performance in bulk was partially offset by a decline in packaged sales, which decreased by 5% for the year.

Here's a look at the composition of the product sales for the fiscal year ended March 31, 2025, based on the product itself:

The combined increase in bulk sales of spirulina and astaxanthin for the year was $1.9 million. To be fair, the shift in product mix is a key strategic point right now.

Beyond the core product sales, Cyanotech Corporation also generates revenue from ancillary services. Contract services and R&D revenue represented approximately 4% of the fiscal year 2025 net sales. Calculating that out, this amounted to roughly $968,600 based on the total net sales figure.

You can see the revenue streams broken down by the main categories:

• Bulk Ingredient Sales (Astaxanthin and Spirulina)
• Packaged Consumer Product Sales (Nutrex Hawaii brand)
• Contract Services and R&D Revenue (approx. 4% of net sales)

Finance: draft 13-week cash view by Friday.