SharkNinja(SN) - 2025 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - SharkNinja achieved $6.4 billion in net sales for 2025, up nearly 16% year-over-year, with adjusted EBITDA increasing more than 19% to $1.14 billion [23][24] - Adjusted earnings per share reached a record $5.28, up nearly 21% year-over-year [23] - In Q4, net sales increased 17.6% year-over-year to $2.1 billion, with domestic sales up 15.7% and international sales up 21.4% [24][25] - Adjusted gross margins in Q4 increased nearly 40 basis points year-over-year to 48.2% of net sales [29] Business Line Data and Key Metrics Changes - Cleaning category net sales increased 3.4% year-over-year to $670 million, driven by innovations like the Shark Stain Force Cordless Spot and Stain Cleaner [26] - Cooking and beverage category net sales increased 11.7% year-over-year to $667 million, with the Ninja Luxe Café Espresso Machine being a significant contributor [26] - Food preparation category net sales increased 28.1% year-over-year to $438 million, supported by momentum in the frozen treats business [26][27] - Beauty and home environment category saw a remarkable 63.2% year-over-year growth to $326 million, driven by multiple subcategories including Shark beauty tech products [27] Market Data and Key Metrics Changes - The U.K. business grew 9.2% year-over-year in Q4, despite declines in air fryer sales, showcasing the strength of diversification [25] - Latin America, particularly Mexico, experienced triple-digit growth, indicating strong momentum and future opportunities [21][24] - EMEA region showed robust results across multiple countries, with a focus on transitioning to a direct operating model [20][54] Company Strategy and Development Direction - SharkNinja's strategy focuses on diversification across products, channels, and geographies to drive growth [8][9] - The company aims to expand into new categories, having entered two additional subcategories in 2025 and planning to add two more in 2026 [15][16] - Investment in technology, particularly AI, is a key focus for long-term growth, with plans to hire 100 new software engineers [12][11] - The company announced a $750 million share repurchase program, reflecting confidence in its financial position and commitment to shareholder value [14][37] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating macroeconomic challenges, emphasizing that these challenges present opportunities for growth [40] - The outlook for 2026 includes expected net sales growth of 10% to 11% and adjusted net income per diluted share growth of 12% to 14% [38] - Management highlighted the importance of consumer engagement and product resonance as key drivers for future success [60][61] Other Important Information - SharkNinja's balance sheet showed a net cash position at the end of 2025, providing flexibility for future investments [35] - The company has completed its global Oracle implementation and launched Salesforce in the U.S. and Canada to enhance direct-to-consumer capabilities [11] Q&A Session Summary Question: Medium-term growth algorithm for U.S. business - Management indicated that the U.S. business is expected to achieve double-digit growth in 2026, with contributions from both units and pricing [45][46] Question: International segment growth and visibility - Management noted that international growth is expected to outpace domestic growth, with strong momentum in Latin America and EMEA [49][52] Question: Characteristics of customers acquired through beauty segment - Management highlighted that the beauty segment is attracting a younger demographic, including young males, and emphasized the potential for category expansion [63][64] Question: Success of celebrity campaigns and future initiatives - Management reported significant growth in social media engagement and consumer perception, attributing success to celebrity partnerships and a sophisticated demand generation strategy [70][72]