Core Insights - Vita Coco Company reported strong Q3 financials, with adjusted EPS of $0.40 beating the consensus estimate of $0.31 and revenue of $182.0 million surpassing expectations of $158.5 million, leading to a 3% stock gain post-release [1][8] Financial Performance - Revenue grew by 37% year over year, significantly exceeding the company's prior guidance, indicating robust demand [6] - Adjusted EBITDA increased to $32 million, up $9 million from the previous year, while net income rose to $24 million, a $5 million improvement year over year [3][8] - Gross profit reached $69 million, highlighting contributions from both pricing and volume [6][8] Segment Performance - Vita Coco Coconut Water segment experienced a 42% year-over-year growth, driven by strong consumer demand and effective operational execution [2][8] - The company anticipates high teens growth for the Coconut Water brand through 2025, reflecting sustained momentum [2][4] Guidance and Outlook - Full-year 2025 net sales guidance was raised to a range of $580 million to $595 million, with adjusted EBITDA guidance now at $90 million to $95 million [4] - CEO Martin Roper emphasized that the increased guidance is based on strong shipment performance and demand trends [4] Capital Allocation - The company holds a solid financial position with $204 million in cash and equivalents against $323.7 million in shareholders' equity [7] - A $65 million share repurchase program has been authorized, with $42 million remaining, indicating confidence in intrinsic value [7] Market Position - The stock is trading near 52-week highs, with institutional ownership at 80%, reflecting broad confidence in the company's execution [10] - Forward earnings estimates suggest continued growth acceleration, leaving limited margin for disappointment in future quarters [10]

Core Insights - Vita Coco exceeded both top and bottom line consensus expectations in its Q3 financial report [1] Financial Performance - The company reported strong financial results, surpassing analyst expectations for revenue and earnings [1]

Core Insights - Vita Coco Company, Inc. reported revenue of $182.31 million for the quarter ended September 2025, marking a year-over-year increase of 37.2% [1] - The earnings per share (EPS) for the same period was $0.40, compared to $0.32 a year ago, indicating a positive growth trend [1] - The reported revenue exceeded the Zacks Consensus Estimate of $158.78 million by 14.82%, and the EPS also surpassed the consensus estimate of $0.32 by 25% [1] Financial Performance - Net sales in the Americas reached $151.72 million, exceeding the average estimate of $135.17 million from three analysts [4] - International net sales were $30.59 million, surpassing the average estimate of $23.1 million from three analysts [4] - Net sales for Vita Coco Coconut Water in the Americas were $132.44 million, compared to the estimated $113.5 million [4] - Private Label net sales in the Americas were $14.36 million, slightly below the average estimate of $16.02 million [4] Stock Performance - Over the past month, shares of Vita Coco Company have returned -0.5%, while the Zacks S&P 500 composite has increased by 3.8% [3] - The stock currently holds a Zacks Rank 5 (Strong Sell), suggesting potential underperformance relative to the broader market in the near term [3]

Financial Data and Key Metrics Changes - Net sales for the third quarter increased by 37% year-over-year to $182 million, driven by a 42% growth in Vita Coco Coconut Water [9][16] - Gross profit rose to $69 million, an increase of $17 million compared to the previous year, with gross margins at 38%, down from 39% in Q3 2024 [18][20] - Net income attributable to shareholders was $24 million, or $0.40 per diluted share, compared to $19 million, or $0.32 per diluted share, in the prior year [19][20] - Adjusted EBITDA for Q3 was $32 million, or 18% of net sales, compared to $23 million, or 17% of net sales in 2024 [20] Business Line Data and Key Metrics Changes - Vita Coco Coconut Water net sales increased by 41% to $132 million, with a volume increase of 30% and a price mix benefit of 8% [17] - Private label sales decreased by 13% to $14 million, while the other product category grew by 182%, primarily due to the national launch of Vita Coco Treats [17] - International segment net sales were up 48%, with Vita Coco Coconut Water growing 47%, driven by strong performance in major markets [17] Market Data and Key Metrics Changes - Coconut water category growth was reported at 22% year-to-date in the U.S., 32% in the U.K., and over 100% in Germany [6][7] - Vita Coco Coconut Water grew 21% in retail dollars in the U.S., 32% in the U.K., and over 200% in Germany year-to-date [7] Company Strategy and Development Direction - The company aims to maintain strong growth trends by investing in and developing the coconut water category in priority markets, with a focus on transitioning coconut water from niche to mainstream [8][15] - The company is optimistic about the potential for coconut water to become as large as major beverage categories in the future [8] - The strategy includes regaining private label service regions and enhancing competitive advantages through supply chain improvements [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term potential of the Vita Coco brand and the coconut water category, despite challenges from tariffs and supply chain dynamics [24] - The company is monitoring tariff impacts and is prepared to adjust pricing strategies based on market conditions and competitive actions [45][46] - Management highlighted the importance of maintaining healthy distributor inventories and the potential for future pricing adjustments depending on tariff developments [31][45] Other Important Information - The company raised its full-year net sales guidance to between $580 million and $595 million, expecting full-year gross margins of approximately 36% [22] - The effective tax rate for Q3 was 22%, down from 25% the previous year, primarily due to discrete tax benefits [20] Q&A Session Summary Question: Guidance on Q4 sales and EBITDA - Management acknowledged a tough Q4 comparison due to a strong Q3 and indicated that the underlying growth trend remains strong despite expected declines [26][28] Question: Impact of tariffs on pricing - Management confirmed that tariffs would gradually increase through Q4, with pricing adjustments being monitored based on competitive actions and market conditions [40][45] Question: International market growth and competitive intensity - Management described the international market, particularly in Europe, as underdeveloped compared to the U.S., with significant growth potential and a strong competitive position [50][58] Question: Capital allocation and use of cash - The company prioritizes growth of the core business, innovation, and potential M&A opportunities, with share buybacks considered if excess cash is available [102]

Financial Data and Key Metrics Changes - Net sales for the third quarter increased by $49 million or 37% year over year to $182 million [16] - Vita Coco Coconut Water grew by 42%, while private label grew by 6% [16] - Gross profit for the quarter was $69 million, an increase of $17 million compared to the prior year, with gross margins at 38% [18] - Net income attributable to shareholders was $24 million or $0.40 per diluted share, compared to $19 million or $0.32 per diluted share for the prior year [19] - Adjusted EBITDA for the third quarter was $32 million, or 18% of net sales, compared to $23 million, or 17% of net sales in 2024 [20] Business Line Data and Key Metrics Changes - Within the Americas, Vita Coco Coconut Water net sales increased by 41% to $132 million, while private label decreased by 13% to $14 million [17] - The other product category grew by 182%, primarily due to the national launch of Vita Coco Treats [17] - International segment net sales increased by 48%, with Vita Coco Coconut Water growing by 47% [17] Market Data and Key Metrics Changes - Coconut water category growth was reported at 22% year to date in the U.S., 32% in the U.K., and over 100% in Germany [6] - Year-to-date retail growth for Vita Coco Coconut Water was 21% in the U.S., 32% in the U.K., and over 200% in Germany [7] Company Strategy and Development Direction - The company aims to maintain strong growth trends by investing in and developing the coconut water category in priority markets [8] - The coconut water category is transitioning from niche to mainstream, with expectations of significant future growth [8] - The company is focused on regaining private label business and believes it has a competitive advantage in supply chain and pricing [12][33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term potential of the Vita Coco brand and the coconut water category [24] - The company is optimistic about mitigating tariff impacts through pricing strategies and supply chain adjustments [15] - Management noted that the current operating environment is fluid, with ongoing assessments of tariff impacts and competitive dynamics [13][46] Other Important Information - The company raised its full-year net sales guidance to between $580 and $595 million [21] - Full-year gross margins are expected to be approximately 36%, with higher finished goods costs partially offset by increased pricing [22] - The effective tax rate for the third quarter was 22%, down from 25% the previous year [20] Q&A Session Summary Question: Clarification on guidance and Q4 expectations - Management indicated that the top-line growth guidance implies a sharp decline in Q4 due to tough comparisons from the prior year and the impact of private label trends [26][28] Question: Insights on private label business - Management views private label as complementary and intends to remain competitive, with expectations of regaining some lost regions [32][34] Question: Impact of tariffs on gross margins - Management confirmed that the August tariffs had minimal impact on Q3, with a more significant effect expected in Q4 [40][44] Question: International market growth and competitive landscape - Management highlighted that the international market, particularly in Europe, is still in early stages of development, with significant growth potential [50][60]

Financial Data and Key Metrics Changes - Net sales for Q3 2025 increased by $49 million or 37% year-over-year to $182 million, driven by a 42% growth in Vita Coco Coconut Water [15][18] - Gross profit for the quarter was $69 million, an increase of $17 million compared to the prior year, with gross margins at 38%, down approximately 110 basis points from 39% in Q3 2024 [17][18] - Net income attributable to shareholders was $24 million or $0.40 per diluted share, compared to $19 million or $0.32 per diluted share in the prior year [18] Business Line Data and Key Metrics Changes - Vita Coco Coconut Water net sales increased by 41% to $132 million, with a volume increase of 30% and a price mix benefit of 8% [16] - Private label sales decreased by 13% to $14 million, while the other product category grew by 182%, primarily due to the national launch of Vita Coco Treats [16] - International segment net sales were up 48%, with Vita Coco Coconut Water growing 47%, driven by strong performance in major markets [16] Market Data and Key Metrics Changes - Coconut water category growth was reported at 22% year-to-date in the U.S., 32% in the U.K., and over 100% in Germany [4][5] - Year-to-date retail growth for Vita Coco Coconut Water was 21% in the U.S., 32% in the U.K., and over 200% in Germany [5] - The company noted strong growth trends in Europe, particularly in the U.K. and Germany, with increased investment paying off [5][6] Company Strategy and Development Direction - The company aims to maintain strong growth trends by investing in and developing the coconut water category in priority markets, transitioning coconut water from niche to mainstream [6][7] - The focus remains on building a better beverage platform and leveraging a global diversified supply chain to navigate tariff challenges [12][13] - The company is optimistic about future pricing strategies and potential tariff waivers, which could enhance competitiveness [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term potential of the coconut water category and the company's ability to navigate current challenges [23] - The company anticipates a tougher Q4 due to difficult year-over-year comparisons but remains optimistic about underlying growth trends [15][20] - Management highlighted the importance of monitoring tariff impacts and competitive dynamics before making further pricing decisions [42][44] Other Important Information - The company has a strong balance sheet with total cash on hand of $204 million and no debt under its revolving credit facility [19] - Full-year net sales guidance has been raised to between $580 million and $595 million, with expected gross margins of approximately 36% [20][21] - The company is focused on growth, innovation, and potential M&A opportunities while considering share buybacks if excess cash is available [80][81] Q&A Session Summary Question: Clarification on guidance and Q4 expectations - Management explained that the top-line growth guidance implies a sharp decline in Q4 due to tough comparisons and potential pull-forward of shipments from Q4 into Q3 [25][26] - They emphasized the importance of looking at two-year growth rates for a better understanding of underlying momentum [26][30] Question: Insights on private label business - Management views the private label business as complementary and intends to continue pursuing it, believing they have a competitive advantage in quality and service [31][32] Question: Impact of tariffs on gross margins - Management confirmed that the increased tariffs from Brazil would have a more significant impact in Q4, with expectations for a peak tariff rate of 23% [37][41] Question: Ocean freight and cost structure - Management acknowledged that ocean freight costs have decreased significantly, which could positively impact margins, but cautioned against overestimating its effect [68][70] Question: Capital allocation and use of cash - The company prioritizes growth, innovation, and M&A, with share buybacks considered if excess cash is available [80][81]

Core Insights - Vita Coco Company, Inc. (COCO) reported quarterly earnings of $0.4 per share, exceeding the Zacks Consensus Estimate of $0.32 per share, and showing an increase from $0.32 per share a year ago, resulting in an earnings surprise of +25.00% [1] - The company achieved revenues of $182.31 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 14.82% and increasing from $132.91 million year-over-year [2] - The stock has gained approximately 14.4% since the beginning of the year, while the S&P 500 has increased by 17.2% [3] Earnings Performance - Over the last four quarters, the company has consistently surpassed consensus EPS estimates [2] - The current consensus EPS estimate for the upcoming quarter is $0.16 on revenues of $130.38 million, and for the current fiscal year, it is $1.15 on revenues of $585.18 million [7] Market Outlook - The company's stock is currently rated Zacks Rank 5 (Strong Sell), indicating expectations of underperformance in the near future due to unfavorable estimate revisions prior to the earnings release [6] - The Beverages - Soft drinks industry, to which Vita Coco belongs, is ranked in the bottom 24% of over 250 Zacks industries, suggesting potential challenges ahead [8]

Financial Performance - Net sales for Q3 2025 reached $182.3 million, a 37.3% increase from $132.9 million in Q3 2024[117] - Gross profit for Q3 2025 was $68.7 million, compared to $51.6 million in Q3 2024, reflecting a gross margin improvement[117] - Net income for Q3 2025 was $24.0 million, up from $19.3 million in Q3 2024, representing a 24.5% year-over-year growth[117] - Total net sales increased by $49.4 million, or 37.2%, to $182.3 million for the three months ended September 30, 2025, driven primarily by a 41.8% increase in Vita Coco Coconut Water net sales[119] - Vita Coco Coconut Water net sales increased by $38.4 million, or 40.9%, to $132.4 million for the three months ended September 30, 2025, supported by a 30.3% increase in case equivalents (CE) volume[123] - International segment net sales rose by $9.9 million, or 48.1%, to $30.6 million for the three months ended September 30, 2025, with CE volume growth of 44.1%[126] - For the nine months ended September 30, 2025, consolidated net sales increased by $93.3 million, or 24.0%, to $481.993 million, with Vita Coco Coconut Water contributing a 31.1% net sales increase[119] - The Company reported an income from operations of $27.9 million for the three months ended September 30, 2025, compared to $20.6 million in the same period of 2024[117] Operating Expenses - Operating expenses increased to $40.7 million in Q3 2025 from $31.0 million in Q3 2024, driven by higher marketing and administrative costs[117] - Operating expenses for the three months ended September 30, 2025, increased by $9.8 million, or 31.6%, to $40.7 million, reflecting higher selling, general, and administrative costs[133] - SG&A expenses increased by $9.8 million, or 31.6%, for the three months ended September 30, 2025, primarily due to a $4.3 million rise in people-related expenses[134] - For the nine months ended September 30, 2025, SG&A expenses rose by $17.7 million, or 20.2%, driven by an $8.9 million increase in people-related expenses and a $5.8 million increase in marketing expenses[134] Tariffs and Supply Chain - The U.S. government implemented a 10% baseline tariff effective April 2025, with additional country-specific rates, creating uncertainty in the supply chain[105] - The company is monitoring the evolving tariff landscape and pursuing pricing adjustments and sourcing strategy modifications to mitigate impacts[105] - The company sources products from approximately 20 factories across seven countries, maintaining a fixed asset-lite supply chain model[102] Product Performance - The Private Label product category experienced a decline in net sales by 12.9% for the three months ended September 30, 2025, compared to the same period in 2024, primarily due to the loss of service regions[119] - Other product net sales increased by $3.2 million, or 182.5%, to $4.9 million for the three months ended September 30, 2025, primarily due to the rollout of Vita Coco Treats[125] - Vita Coco Coconut Water net sales increased by $7.1 million, or 47.4%, to $21.9 million for the three months ended September 30, 2025, primarily due to strong demand in Europe[127] Cash Flow and Financing - Cash flows from operating activities increased by $15.1 million, or 41.9%, for the nine months ended September 30, 2025, compared to the same period in 2024[154] - Cash and cash equivalents as of September 30, 2025, were $203.7 million, up from $164.7 million as of December 31, 2024[147] - Cash used in investing activities was $4.9 million for the nine months ended September 30, 2025, primarily due to leasehold improvements for new offices[155] - Net cash used by financing activities decreased by $2.4 million, or 23.5%, for the nine months ended September 30, 2025, driven by lower share repurchases[156] - The company anticipates that current cash, cash equivalents, and future cash flows will be sufficient to meet cash needs for at least 12 months[148] - The company may seek additional equity or debt financing in the future to invest in complementary businesses and product development[151] Tax and Derivative Instruments - The effective tax rate for the nine months ended September 30, 2025, was 20.9%, down from 23.9% in the same period of 2024[142] - Income tax expense for the three months ended September 30, 2025, was $6.7 million, with an effective tax rate of 21.8%[141] - Unrealized gains on derivative instruments for the nine months ended September 30, 2025, were $6.3 million, compared to losses of $5.9 million for the same period in 2024[136] Debt and Credit Facilities - The outstanding balance on the Revolving Credit Facility was zero as of September 30, 2025, indicating no reliance on this credit line[160] - The company had an immaterial amount of debt outstanding related to vehicle loans as of September 30, 2025[157] - The 2020 Credit Facility was amended to extend its maturity to February 13, 2030, with committed borrowings of $60 million[158]

Q3 2025 Performance Highlights - Net sales increased by 37% to $182 million compared to Q3 2024[11] - Gross margin was 38%[11] - Net income was $24 million, or $040 per share[11] - Adjusted EBITDA was $32 million, representing a 178% margin[11] - Cash-on-hand remained strong at $204 million with $0 debt[11] YTD 2025 Performance Highlights - Net sales grew by 24% to $482 million compared to 2024 YTD[14] - Gross margin was 37%[14] - Net income reached $66 million, or $110 per share[14] - Adjusted EBITDA was $84 million, with a 175% margin[14] - The company maintained a strong cash position of $204 million with no debt[14] Updated 2025 Full Year Guidance - Net sales are projected to be between $580 million and $595 million[41] - Adjusted EBITDA is expected to be between $90 million and $95 million[41] - The company anticipates a gross margin of approximately 36%[41] - Branded net sales growth is targeted in the mid-teens[41] - Adjusted EBITDA margin is projected in the high teens[41]

Financial Performance - Net sales increased 37% to $182 million in Q3 2025, driven by a 42% growth in Vita Coco Coconut Water[1][4] - Net income rose to $24 million in Q3 2025, compared to $19 million in the prior year, with net income per diluted share at $0.40[1][8] - Non-GAAP Adjusted EBITDA increased to $32 million in Q3 2025, up from $23 million in the prior year[1][9] - Year-to-date net sales reached $482 million, a 24% increase, with Vita Coco Coconut Water net sales growing 31%[1][4] - The company raised its full year 2025 net sales guidance to between $580 million and $595 million, driven by high teens growth in Vita Coco Coconut Water[1][14] - Net sales for Q3 2025 reached $182.3 million, a 37.3% increase from $132.9 million in Q3 2024[27] - Net income for the nine months ended September 30, 2025, was $65.8 million, compared to $52.6 million for the same period in 2024, reflecting a 25.1% increase[29] - Adjusted EBITDA for Q3 2025 was $32.4 million, a 41.2% increase from $22.9 million in Q3 2024[30] - The Americas segment net sales for Q3 2025 were $151.7 million, a 35.1% increase from $112.2 million in Q3 2024[33] - Vita Coco Coconut Water sales in the Americas segment increased by 30.3% in Q3 2025 compared to Q3 2024[33] Profitability and Margins - Gross profit for Q3 2025 was $69 million, an increase of $17 million, with a gross margin of 38%[1][4][6] - Gross profit for Q3 2025 was $68.7 million, up 33.2% from $51.6 million in Q3 2024, resulting in a gross margin of 37.7%[27] - Future gross margin is expected to be approximately 36%, impacted by increased finished goods costs and current tariffs[1][14] Expenses and Cash Flow - SG&A expenses increased to $41 million in Q3 2025, up from $31 million in the prior year, primarily due to higher marketing investments[1][7] - Operating expenses for Q3 2025 were $40.7 million, compared to $31.0 million in Q3 2024, reflecting a 31.5% increase[27] - Cash and cash equivalents as of September 30, 2025, were $204 million, up from $165 million at the start of the year[1][9] - Cash and cash equivalents at the end of Q3 2025 totaled $204.98 million, up from $157.96 million at the end of Q3 2024[29] Shareholder Returns - The company has approximately $42 million remaining on its share repurchase program as of September 30, 2025[1][10] Foreign Currency Impact - The company reported a foreign currency loss of $1.4 million in Q3 2025, compared to a gain of $0.6 million in Q3 2024[27] Share Information - The weighted-average number of diluted shares outstanding increased to 59.9 million in Q3 2025 from 59.3 million in Q3 2024[27]