In This Article:
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Net Sales: $263.2 million, up approximately 18% year-over-year.
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Adjusted Gross Margin: 45.7%, compared to 45.3% in the prior year period.
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Adjusted EBITDA: $35.5 million, up approximately 16% year-over-year.
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Household Penetration: 14.1 million households, up 13% year-over-year.
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Total Buy Rate: $110, up 6% year-over-year.
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Store Locations: 28,521 stores, with 37,044 fridges.
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Cash on Hand: $243.7 million at the end of the quarter.
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Capital Expenditures: $26.5 million for the first quarter.
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2025 Guidance - Net Sales: $1.12 billion to $1.15 billion, approximately 15% to 18% growth year-over-year.
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2025 Guidance - Adjusted EBITDA: $190 million to $210 million.
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2025 Guidance - Capital Expenditures: Approximately $225 million.
Release Date: May 05, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Freshpet Inc (NASDAQ:FRPT) reported an 18% year-over-year increase in net sales for the first quarter, driven primarily by volume growth.
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The company achieved an adjusted gross margin of 45.7%, slightly up from 45.3% in the prior year period, due to lower input costs and reduced quality costs.
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Freshpet Inc (NASDAQ:FRPT) expanded its e-commerce business by 43% in the quarter, indicating strong growth in online sales.
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The company is launching a new entry price point bag product under the Freshpet Complete Nutrition label to attract more consumers.
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Freshpet Inc (NASDAQ:FRPT) is increasing its advertising investment and tailoring media strategies to attract higher-income consumers, which could drive future growth.
Negative Points
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Freshpet Inc (NASDAQ:FRPT) revised its 2025 net sales guidance down to $1.12 billion to $1.15 billion, reflecting a lower growth rate of 15% to 18% year-over-year.
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The company experienced a slowdown in sales growth due to macroeconomic uncertainty affecting consumer behavior.
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Freshpet Inc (NASDAQ:FRPT) noted that consumer uncertainty is making them hesitant to try more expensive pet food, impacting the rate of new consumer additions.
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The company faced challenges in the pet specialty channel due to a distributor change, which impacted net sales growth by about 1 point.
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Freshpet Inc (NASDAQ:FRPT) anticipates elevated costs to acquire new households, which could impact profitability in the near term.
Q & A Highlights
Q: Given the recent economic changes and scanner data, how does Freshpet's updated guidance account for potential macroeconomic downturns? A: William Cyr, CEO, explained that Freshpet's guidance assumes the current consumer environment will persist throughout the year. They have considered various scenarios and believe their marketing plans and new customer distribution gains will support their position. If conditions worsen, they will take appropriate actions, but they currently feel stable.