Yeti Holdings, Inc. raised its earnings guidance for the year after reporting Q4 sales and profits topped expectations on strength across categories. Company President and CEO Matt Reintjes said Thursday that Yeti is back to delivering oversized growth, with Wholesale delivering its best quarterly performance in over three years, Drinkware returning to growth in the U.S., and demand for soft coolers and bags outstripping supply.

“We’ve entered the second quarter with global demand trends showing strength, continuing momentum from the last two quarters,” Reintjes commented on a quarterly conference call with analysts.

First Quarter Sales Sumamry
In the quarter, sales increased 8 percent year-over-year to $380.4 million, topping Wall Street’s consensus target of $374.8 million.

Wholesale sales jumped 19 percent to $184 million. Scott Bomar, CFO, said on the call that Q1 sell-in trends at Wholesale were better aligned with sell-through trends, “which have remained strong.” He added, “Channel inventory remains healthy, which bodes well for performance in the Wholesale channel in the upcoming quarters. Our teams are working closely with retail partners as they thoughtfully replenish inventory to support strong consumer demand across categories.”

Direct-to-consumer (DTC) sales were flat at $197 million. Consumer demand was strong across its own e-commerce, Amazon Marketplace, and Yeti retail stores, with performance in these channels coming in line with overall sales growth for the quarter.

Corporate Sales channel sales declined year-over-year, driven by caution from corporate buyers, challenging comparisons to last year’s strong results, and some order timing dynamics. Corporate sales have improved so far in the second quarter.

Coolers & Equipment sales increased 11 percent to $156.1 million, primarily driven by strong performance in soft coolers, bags, hard coolers, and cargo, reflecting continued strength across core and expanded categories. Daytrip and Camino tote bags remain “standout performers.”

U.S. sales increased 8 percent to $293.1 million, supported by growth across coolers and equipment and drinkware. Demand remained strong across wholesale, e-commerce, Amazon, and retail, partially offset by softness in corporate sales.

International sales increased 9 percent to $87.3 million, reflecting strong growth in Europe, as well as growth in Australia and Canada, and continued momentum in Japan. The growth benefited from FX favorability of approximately 800 basis points. Growth internationally was impacted by a decline in corporate sales, but Yeti continues to expect international sales for the full year climb in the high teens to 20 percent range.

Profitability & Expenses Summary
Adjusted net income decreased 23 percent to $19.8 million, or 26 cents a share, but topped analysts’ consensus of 19 cents. The latest quarter included an unfavorable net impact from incremental tariff costs of approximately 9 cents. Adjusted earnings exclude numerous one-items, including employee severance costs in connection with strategic organizational realignments as well as advisory and legal fees. Net income decreased 41 percent to $9.9 million, or 13 cents a share.

Adjusted gross margins decreased 200 basis points, including 280 basis points of headwind from higher tariff costs year-over-year, as well as the unfavorable impact from a lower mix of its D2C channel. This is partially offset by lower product costs and the favorable impact of foreign currency exchange rates.

Adjusted SG&A grew 10 percent to $184 million, reflecting continued growth investments in facilities, including two new stores, sales and product development headcount to support international expansion, and technology to support its digital network. As a percent of sales, adjusted SG&A grew 100 basis points to 48.3 percent.

CEO Commentary
Highlighting some brand’s accomplishments, Reintjes noted that diversification in recent years is helping drive broad-based strength seen across categories and channels, supporting “resilient, diversified, and increasingly repeatable” demand. The CEO said, “That diversification matters because it reduces reliance on any single product cycle or channel dynamic and allows us to invest consistently behind innovation, brand, and capabilities without chasing short-term volatility.”

Yeti is also broadening its customer base. Reintjes said, “Innovation continues to attract customers, particularly in newer categories like bags, soft coolers, and sports hydration drinkware  while repeat purchasing and retention remain strong.”

Among metrics cited, 12-month retention at yeti.com held steady while lifetime value continued to grow. In the U.S., brand awareness, consideration, and preference increased across coolers, drinkware, and bags, with bags reaching their highest levels since tracking began in 2022. Brand NPS remains healthy across demographic groups. Product satisfaction is approximately 98 percent, and nearly two-thirds of surveyed customers now own products across multiple categories.

Said Reintjes, “Taken together, these indicators point to a brand that is expanding its reach while maintaining its promise, which is exactly what we aim to deliver.”

Among major categories, Reintjes said drinkware is “proving it remains a scalable, durable platform,” despite recent challenges in the broader categories. The growth in the quarter, including growth in sell-in and sell-through in the U.S., was not driven by a “single-hero SKU,” but by “refreshed core products, targeted extensions, and disciplined pricing and promotional posture, reflecting innovation and newness, including stackable cups, chug bottles, ceramic mugs, and the Yonder Shaker Bottle.”

Growth of drinkware going forward continues to be supported by extensions into adjacencies. Reintjes said, “We see additional runway deepening our presence in sport and fitness hydration, which continue to attract younger consumers and new use cases, making it additive to the platform and expanding the addressable market over time.”

In coolers and equipment, double-digit growth in the quarter was led by soft coolers and bags. The continuing appeal of the Daytrip and Camino tote bags extends Yeti “further into everyday use.” Additional capacity coming in the back half of the year is expected to allow Yeti to better capitalize on demand for its bags, soft coolers, and carry solutions.

In hard coolers, seasonal color innovation supported the category as prior-year product transitions were lapped. Said Reintjes “Cargo performed well across platforms with particular strength in the GoBox 1 protective case, establishing a foundation for future expansion coming in 2026.”

Around channels, Reintjes noted that the 19 percent growth in wholesale revenues in the quarter was helped by double-digit sell-through growth in the U.S., balanced inventory positions, and strong response from wholesale partners to new products. Said Reintjes, “U.S. wholesale inventories remain well managed and aligned with demand across major categories. Our approach to the channel remains disciplined and consistent. Protect brand presentation, maintain premium positioning, and prioritize long-term shelf productivity, not short-term volume.”

Within DTC, the performance of owned and marketplace channels tracked well with Yeti’s overall robust growth. Said Reintjes, “Performance was driven by seasonal color launches, expanded customization, and meaningful enhancements to our U.S. and Canadian websites, improving conversion, add-to-cart rates, and average order value.”

Recent digital investments include the launch of its AI-driven shopping assistant, Ranger; and the brand’s launch on TikTok shop. Reintjes added that the flat corporate sales were driven by “corporate sales timing and a more cautious global corporate environment, not a change in consumer engagement with the brand.”

Outlook
With the first quarter exceeding expectations, Yeti now expects full-year sales growth of 7 percent to 8 percent, up from previous guidance of 6 percent to 8 percent. The quarterly sales growth rate is expected to be relatively consistent throughout the rest of the year,

High-single digit to low double-digit growth is projected in coolers and equipment, supported by the momentum across soft coolers, bags, hard coolers, cases, and storage. Drinkware is expected to continue to show mid-single-digit growth, driven by increased innovation, the continued broadening of the portfolio, and global expansion.

By channel, wholesale is expected to grow at a slightly faster rate than DTC as a result of strong customer traffic and merchandising innovations at wholesale partners. Mid-single-digit growth is projected for the U.S., with international growth seen climbing in the high teens to 20 percent.

Gross margins are now expected to arrive in the range of 56.5 percent to 57 percent compared to prior year guidance of 56 percent-57 percent. At the midpoint, Yeti now expects a 60 basis-point margin decline year-over-year compared to prior guidance of a 90 basis-point decline. The increase reflects the benefit from lower realized tariff rates, partially offset by higher commodity and inbound transportation costs. Guidance doesn’t include an assumption for the recovery of any potential IEEPA refunds.

Operating expense is expected to expand between 4 percent and 7 percent year over year, reflecting operating leverage and ongoing cost discipline. EPS is now projected between $2.83 to $2.89, reflecting growth of 14 percent-17 percent compared to prior year guidance of $2.77 to $2.83 or growth of 12 percent-14 percent.

Image courtesy Yeti