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Apr 01, 2023
YETI Q1 2023 Earnings Report
YETI's financial performance was impacted by voluntary recalls, but the company demonstrated its ability to execute against strategic priorities. The company expanded its product portfolio and continued its growth outside of the U.S.
Key Takeaways
YETI Holdings, Inc. reported a 3% increase in sales for the first quarter of 2023, despite the impact of voluntary recalls. The company's direct-to-consumer channel saw a 7% increase, while wholesale channel sales decreased by 1%. Gross profit increased by 5%, and the company reiterates its 2023 outlook.
Sales increased 3% to $302.8 million, compared to $293.6 million during the same period last year.
Direct-to-consumer channel sales increased 7% to $167.0 million, compared to $156.0 million in the prior year quarter.
Gross profit increased 5% to $161.9 million, or 53.5% of sales.
Adjusted net income decreased 46% to $15.5 million.
Revenue by Segment
Forward Guidance
YETI believes it is in a strong position to deliver upon its full year outlook. The company continues to take a prudently cautious approach to its outlook, particularly with its largest quarters ahead. YETI remains confident in its path ahead as it looks to return to double-digit sales growth in the fourth quarter with the return of its full soft cooler line. In addition, the company also remains confident in its ability to steadily improve its gross margin profile as it goes through the year. Finally, YETI believes the investments it is making this year will fuel its future growth on a global basis as it looks out over the longer term.
Positive Outlook
- Adjusted sales to increase between 3% and 5% with adjusted sales growth weighted to the second half of the year, inclusive of an approximate 500 basis points unfavorable impact on our growth rate from the stop sale of the affected products by the voluntary recalls.
- Adjusted operating income as a percentage of adjusted sales between 15% and 15.5% and adjusted operating income to decrease between 3% and 8%.
- Adjusted gross margin is expected to expand through the remainder of the year.
- An effective tax rate of approximately 24.9%.
- Adjusted net income per diluted share between $2.12 and $2.23, reflecting a 5% to 10% decrease, with earnings growth beginning in the fourth quarter of the year.
Challenges Ahead
Revenue & Expenses
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