Core Insights - Freshpet Inc. reported second-quarter 2025 earnings of 33 cents per share, exceeding the consensus estimate of 16 cents [1] - Net sales increased by 12.5% year-over-year to $264.7 million, although it fell short of the analyst estimate of $268.9 million [1] - Sales growth was attributed to a 10.8% rise in volume and a 1.7% improvement in price and mix [1] Company Performance - CEO Billy Cyr noted that Freshpet continues to outperform the dog food category despite challenging consumer sentiment, achieving category-leading sales growth and operational improvements [2] - The company updated its 2025 outlook, now expecting net sales growth of 13% to 16%, down from a previous range of 15% to 18% [3] - Adjusted EBITDA guidance remains unchanged at $190 million to $210 million, while capital expenditures are now forecasted at approximately $175 million, reduced from the prior estimate of $225 million [3] Market Reaction - Following the earnings announcement, Freshpet shares fell by 2.2% to trade at $68.33 [3] - Analysts adjusted their price targets for Freshpet, with Benchmark analyst Todd Brooks maintaining a Buy rating but lowering the target from $120 to $95, and Truist Securities analyst Bill Chappell maintaining a Hold rating while reducing the target from $80 to $70 [5]

Financial Performance - Net sales reached $264.7 million, a 12.5% increase year-over-year[13] - Adjusted gross margin improved to 46.9%, up 100 basis points year-over-year[13] - Adjusted EBITDA was $44.4 million, an increase of $9.3 million year-over-year, with an adjusted EBITDA margin of 16.8%, up 190 basis points[13] - Operating cash flow was $33.9 million[13] Operational Efficiency - Logistics costs were 5.7% of net sales, a decrease of 10 basis points year-over-year[13] - Input costs were 28.9% of net sales, a decrease of 90 basis points year-over-year[13] - Quality costs were 2.0% of net sales, a decrease of 70 basis points year-over-year[13] - The company expects to reduce capital spending by at least $100 million in 2025-2026 due to improved output and new technology[17] Retail and Consumer Growth - Total household penetration increased by 11%[13] - Total buy rate increased by 6%[13] - MVP (Most Valuable Pet Parents) household penetration increased by 18%[13] - The company added approximately 1.4 million households year-over-year[25] Guidance - The company updated its net sales growth guidance for FY 2025 to 13-16% year-over-year[62] - Capital expenditures are expected to be approximately $175 million[62] - The company expects to end the year with approximately $250 million in cash and be free cash flow positive in 2026[64]