YETI Q1 Earnings Call Highlights

Key Points

• YETI beat Q1 expectations with sales up 8.3% to $380.4 million and raised the low end of its full-year guidance. The company now expects 7% to 8% sales growth and higher adjusted EPS of $2.83 to $2.89.
• Wholesale was the standout channel, rising 19% to $184 million for the best quarterly performance in more than three years. Drinkware returned to growth and Coolers & Equipment climbed 11%, helping offset flat DTC sales and weaker corporate orders.
• Margins were pressured by tariffs, which helped push adjusted gross margin down to 55.3% and cut EPS to $0.26 in the quarter. Even so, YETI expects better full-year margins and boosted share repurchase authorization by about $350 million.

YETI NYSE: YETI reported first-quarter fiscal 2026 sales growth of 8.3% and raised parts of its full-year outlook, as management pointed to stronger wholesale demand, improving Drinkware trends and continued momentum in Coolers & Equipment.

President and CEO Matt Reintjes said the quarter reinforced “the earnings power of the model,” citing more diversified demand, efficient scaling across product platforms and disciplined execution in a dynamic environment. He added that YETI entered the second quarter with global demand trends showing strength, continuing momentum from the prior two quarters.

Chief Financial Officer Scott Bomar, who joined the company earlier this year, said first-quarter sales totaled $380.4 million, up 8.3% from a year earlier. He said growth was broad-based across categories and channels and landed at the top end of the company’s initial full-year sales growth outlook range of 6% to 8%.

Wholesale Strength Offsets Corporate Sales Softness

YETI’s wholesale channel was a key driver in the quarter. Bomar said wholesale sales increased 19% to $184 million, marking the company’s best quarterly wholesale performance in more than three years. He said sell-in trends were better aligned with sell-through trends, which remained strong, and channel inventory was healthy.

Reintjes said the wholesale performance validated the strength of the brand and the relevance of YETI’s product pipeline. He noted that U.S. wholesale sell-through grew at a double-digit rate and that inventory positions remained balanced across major categories.

Direct-to-consumer sales were flat at $197 million. Bomar said demand was strong across YETI’s own e-commerce business, Amazon Marketplace and retail stores, with those areas growing in line with overall company sales. However, the corporate sales channel declined year over year due to caution from corporate buyers, tough comparisons to last year’s strong results and order timing.

In response to an analyst question, Bomar said corporate sales represent approximately 25% of YETI’s DTC business. Reintjes said the company still sees “untapped potential” in corporate sales but will remain disciplined, noting that larger corporate orders can be lumpy and that YETI will not chase volume at the expense of brand integrity or pricing discipline.

Drinkware Returns to Growth, Coolers & Equipment Rises Double Digits

By category, Drinkware sales grew 5% to $217 million, marking a second consecutive quarter of mid-single-digit growth and a return to growth in the U.S. Drinkware business. Reintjes said the category’s performance was not driven by a single product, but by broader platform strength, including refreshed core products, extensions and innovation such as stackable cups, chug bottles, ceramic mugs and the Yonder Shaker Bottle.

Bomar said Drinkware results reflected the durability of the category and YETI’s ability to drive sustained growth through innovation and audience expansion. During the question-and-answer session, Reintjes said the large-format straw trend had “largely” settled out for YETI and emphasized the company’s strategy of broadening Drinkware across different use cases, including sports hydration.

Coolers & Equipment sales rose 11% to $156 million. Management said growth was driven by Soft Coolers, bags, Hard Coolers, cases and storage products. Reintjes highlighted the Daytrip and Camino lines as standout performers and said demand in some Soft Cooler and bag programs exceeded supply through 2025 and into the first quarter of 2026. Additional capacity expected in the back half of the year should allow the company to better meet demand, he said.

Reintjes also said the bags business remains a significant opportunity beyond 2026, pointing to momentum in Camino, Daytrip Soft Coolers and Skala backpacks.

International Growth Continues, Though Q1 Was Affected by Timing

U.S. sales increased 8% to $293 million, supported by growth in both Coolers & Equipment and Drinkware. International sales grew 9% to $87 million, including a foreign exchange benefit of approximately 800 basis points.

Bomar said underlying international consumer demand remained strong, but first-quarter growth was affected by a decline in corporate sales. He reiterated that international growth can fluctuate from quarter to quarter, particularly because the first quarter is seasonally the company’s smallest period.

For the full year, YETI continues to expect international sales growth in the high teens to 20% range. Reintjes said Europe continues to show strong demand as the company expands doors and brand awareness, Japan is in a ramp phase, Southeast Asia continues its rollout and China and Korea remain targeted for the second half of the year. He cautioned that China and Korea are not expected to be material drivers in 2026, but are part of the long-term growth pipeline.

Margins Pressured by Tariffs, but Outlook Improves

Adjusted gross profit was $210 million, or 55.3% of sales, down 200 basis points from the prior year. Bomar said the decline included a 280-basis-point headwind from higher tariff costs, as well as an unfavorable impact from a lower DTC mix. These pressures were partially offset by lower product costs and favorable foreign currency effects.

Adjusted selling, general and administrative expenses rose 10% to $184 million, or 48.3% of sales. Bomar said the increase reflected investments in facilities, including two new stores, sales and product development headcount to support international expansion and technology for digital businesses.

Adjusted operating income fell 24% to $26.6 million, or 7% of sales. Adjusted net income decreased 23% to $19.8 million, and adjusted earnings per share declined to $0.26 from $0.31. Bomar said the results included an incremental unfavorable net tariff impact of approximately $0.09 per share.

YETI ended the quarter with $127.8 million in cash, down from $259 million a year earlier, primarily due to elevated share repurchases in 2025. Inventory decreased 4% to $318 million, and total debt, excluding finance leases and unamortized deferred financing fees, was approximately $73 million.

YETI Raises Low End of Sales Guidance and EPS Outlook

YETI raised the low end of its full-year sales growth outlook and now expects fiscal 2026 sales growth of 7% to 8%, compared with prior guidance of 6% to 8%. Bomar said the company expects growth to remain relatively consistent through the rest of the year.

The company also raised the lower end of its gross margin outlook, now expecting full-year gross margin of 56.5% to 57%, compared with previous guidance of 56% to 57%. Bomar said the improvement reflects lower realized tariff rates, partially offset by higher commodity and inbound transportation costs.

YETI now expects adjusted operating income margin of approximately 14.6%, up 20 basis points from 2025 and above its prior guidance. Adjusted operating income is expected to grow 8% to 10%, compared with prior guidance of 6% to 8%.

Adjusted earnings per diluted share are now expected to be $2.83 to $2.89, representing growth of 14% to 17%. The prior outlook called for $2.77 to $2.83, or growth of 12% to 14%. The company continues to expect capital expenditures of $60 million to $70 million and free cash flow of $200 million to $225 million in 2026.

Bomar also said YETI’s board increased the company’s share repurchase authorization by approximately $350 million, bringing the remaining authorization to $500 million. The company’s outlook assumes approximately $100 million in share repurchases during 2026.

Reintjes said YETI remains focused on building long-term value through brand strength, scalable product platforms, international expansion, omnichannel diversification and operational discipline. He said the company expects to discuss its long-term growth algorithm, margin framework, innovation roadmap and capital allocation priorities in more detail at an investor day targeted for September.

About YETI NYSE: YETI

YETI Holdings, Inc is an American outdoor and lifestyle products company known for its premium, performance-driven coolers, drinkware and accessories. The company's portfolio includes hard coolers under its flagship Tundra series, soft coolers in the Hopper line, and vacuum-insulated drinkware sold under the Rambler brand. YETI's products are engineered for durability, temperature retention and rugged outdoor use, targeting consumers ranging from avid anglers and hunters to outdoor enthusiasts and everyday users seeking high-quality insulated containers.

Founded in 2006 by brothers Roy and Ryan Seiders in Austin, Texas, YETI began with a focus on building a better cooler that could withstand extreme conditions and maintain ice retention longer than traditional alternatives.

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