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Welcome to Beta Finch, your AI-powered earnings breakdown, bringing you the numbers, the narrative, and everything in between.

ALEX: Hey everyone, welcome back to Beta Finch! I'm Alex, joined as always by Jordan, and today we are digging into YETI Holdings' second quarter fiscal 2026 results. Before we jump in — quick disclaimer: this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

JORDAN: Good to be here, Alex. And YETI actually gave us a lot to chew on this quarter — beat expectations, raised guidance, and dropped a teaser for their upcoming Investor Day. Let's get into it.

ALEX: Let's start with the headline numbers. YETI posted sales of about $484 million, up 9% year-over-year. That's broad-based growth — across categories, channels, and regions. Adjusted gross margin expanded a healthy 170 basis points to 59.5%, and they raised their full-year gross margin outlook to 57.5-58%.

JORDAN: And that margin story is interesting because there's a tariff wrinkle in there. They got an $8.2 million benefit from IEEPA tariff refunds this quarter, but CFO Scott Bomar was pretty clear that a good chunk of that got eaten up by other inflationary pressures — steel, resins, oil-derivative materials, and transportation costs. So the underlying operational execution — pricing discipline, product cost management — is really what's driving the margin story, not just a one-time tariff windfall.

ALEX: Right, and that shows up in the EPS guidance too. They bumped full-year adjusted EPS guidance up to $2.94 to $3.00, which is 19-21% growth, compared to the prior guide of 14-17%. That's a meaningful raise.

JORDAN: It is, though I'd flag that adjusted operating income actually decreased 7% this quarter to $68 million, and adjusted net income was down 8%. That's mostly a timing story — their big "4 Letters" brand campaign shifted from Q4 last year into Q2 this year, which deleveraged SG&A by about 410 basis points. So the full-year picture looks strong, but quarter-to-quarter comparisons get a little noisy because of that campaign timing.

ALEX: That's a great segue into strategy, because that 4 Letters campaign came up a lot on the call. CEO Matt Reintjes talked about it as more of a platform than a one-off campaign — it got them into major live sports moments, including the most-watched NBA Finals game since 2016, and they're now breaking it down into smaller digital pieces to keep the momentum going through the rest of the year.

JORDAN: What stood out to me is how much they leaned into the "platform" language across the board — not just for marketing, but for products too. Daytrip bags, Camino totes, the Roadie personal coolers, LoadOut GoBox cases — management kept hammering home that growth isn't tied to one product cycle or category anymore.

ALEX: And that diversification pitch is really aimed at the drinkware conversation, which was probably the most detailed topic on this call. Drinkware sales only grew 2% in the quarter, and management actually gave us new information — they quantified a 600 basis point drag on U.S. drinkware growth in 2026 coming from just three legacy SKUs tied to that trend-driven hype cycle from a few years back.

JORDAN: Which is a pretty transparent move, honestly. They're essentially saying, "look, without this specific headwind, our underlying drinkware business is performing really well." And they expect those SKUs to largely cycle out by year-end, resetting the base heading into 2027. U.S. consumer demand for drinkware was still up mid-single digits in the quarter, even with sales themselves flat.

ALEX: On the geographic side, international was a bright spot — sales up 19% to $93 million, with strong growth in Europe, Australia, and Japan. They're exp

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**BETA FINCH PODCAST SCRIPT**

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**ALEX:** Welcome to Beta Finch, your AI-powered earnings breakdown where we dive deep into the numbers that move markets. I'm Alex.

**JORDAN:** And I'm Jordan. Today we're unpacking Yeti's first quarter 2026 earnings call - and wow, what a story of resilience and strategic execution this outdoor gear company is telling.

**ALEX:** Before we dive in, I need to share our standard disclaimer - this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

**JORDAN:** Absolutely. Now, let's talk Yeti. Alex, this company just celebrated its 20th anniversary, and their Q1 results suggest they're hitting their stride at exactly the right time.

**ALEX:** The headline numbers are impressive, Jordan. Yeti posted $380.4 million in revenue, up 8.3% year-over-year, hitting the top end of their initial guidance range. That's meaningful momentum coming out of what's traditionally their smallest quarter.

**JORDAN:** What really caught my attention was the broad-based nature of this growth. We're seeing strength across both major product categories - Drinkware grew 5% to $217 million, which marks their second consecutive quarter of mid-single-digit growth, and importantly, a return to growth in the U.S. market.

**ALEX:** That's huge because Drinkware has been under pressure. CEO Matthew Reintjes made a fascinating point about this - he said the growth isn't being driven by a single hero product anymore. Instead, it's what he called "platform health" with growth broadening across stackable cups, chug bottles, ceramic mugs, and their Yonder Shaker bottle.

**JORDAN:** And Coolers & Equipment was even stronger at 11% growth to $156 million. Their soft coolers and bags - particularly the Daytrip and Camino products - are absolutely crushing it. But here's the kicker: they're actually supply-constrained on these hot products, meaning there's pent-up demand they couldn't fully capture in Q1.

**ALEX:** Speaking of supply constraints, CFO Scott Bomar mentioned that fill rates in certain soft cooler and bag programs ran short, with additional capacity coming in the back half of the year. That's a high-quality problem to have - basically, they're selling everything they can make.

**JORDAN:** Let's talk channels because this is where Yeti's diversification strategy really shines. Wholesale sales jumped 19% to $184 million - their best quarterly performance in over three years. But direct-to-consumer was flat at $197 million, and there's an interesting story there.

**ALEX:** Right, the D2C flatness was entirely due to corporate sales softness. Bomar broke this down nicely - corporate sales represents about 25% of their D2C business, and while that channel struggled due to cautious corporate buyers and timing issues, their other D2C channels - yeti.com, Amazon, and retail stores - all grew high single digits.

**JORDAN:** And internationally, we saw 9% growth to $87 million, though that included an 800 basis point FX tailwind. Still, the underlying consumer demand internationally remains strong, and they're maintaining their full-year international growth guidance of high teens to 20%.

**ALEX:** Now let's talk margins, because this is where things get interesting. Adjusted gross profit margin came in at 55.3%, down 200 basis points year-over-year, primarily due to tariff headwinds of 280 basis points.

**JORDAN:** But here's what I found encouraging - they're navigating these tariff impacts with impressive agility. The company originally planned for IEEPA tariff rates of about 20% throughout the year, but those were replaced by Section 122 tariffs at roughly half the rate. That change created about $15 million in benefits, though two-thirds was offset by higher commo

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# Beta Finch Podcast Script: YETI Q4 2025 Earnings

**ALEX**: Welcome to Beta Finch, your AI-powered earnings breakdown where we dive deep into the numbers that matter. I'm Alex, and with me as always is Jordan. Today we're unpacking YETI Holdings' fourth quarter 2025 results - and folks, this one's got some interesting twists.

But before we jump in, I need to share something important: This podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

**JORDAN**: Thanks Alex. And what a quarter to analyze! YETI just reported their strongest quarter of 2025, with 5% net sales growth hitting $583.7 million. But here's the thing that caught my attention - they're dealing with some serious tariff headwinds while still managing to grow internationally at 25%.

**ALEX**: Right, it's really a tale of two stories here. On one hand, you've got this premium outdoor brand that's absolutely crushing it globally - international sales now represent 23% of total revenue, up from 20% last year. But on the other hand, they're getting hammered by tariffs to the tune of about $80 million in additional costs compared to 2024.

**JORDAN**: Let's break down those category numbers because they tell an interesting story. Drinkware - that's their bottles, tumblers, the stuff you see everywhere - grew 6% to $380 million. Remember, this category has been under pressure all year from promotional activity and what they call "trend-driven styles" being heavily discounted.

**ALEX**: And Coolers & Equipment, which includes their signature hard coolers plus bags and soft coolers, grew 2% to $192 million. Now, Jordan, that might seem modest, but CEO Matthew Reintjes mentioned they were actually supply-constrained on some of their hottest products like the DayTrip soft coolers and Camino totes.

**JORDAN**: Exactly, and that supply constraint issue is actually bullish when you think about it. They're essentially leaving money on the table because they can't make enough product to meet demand. Management said new production capacity is coming online in the first half of 2026, which should help.

**ALEX**: Speaking of 2026, let's talk guidance because this is where it gets really interesting. They're projecting 6-8% sales growth for the full year, but here's the kicker - they expect margins to get crushed in the first half due to tariff annualization, then recover in the second half.

**JORDAN**: The math here is pretty stark, Alex. They're looking at gross margins of 56-57% for 2026, down about 90 basis points year-over-year. But get this - tariffs alone are adding 200 basis points of headwind. So they're actually offsetting about half of that impact through cost reductions and selective price increases.

**ALEX**: And there was some significant news on the leadership front. CFO Michael McMullen is stepping down after a decade with the company, including three years as CFO. His replacement is Scott Bomar, coming from The Home Depot where he was SVP of Finance.

**JORDAN**: That's a notable hire, Alex. Home Depot operates at massive scale with complex supply chains - exactly the kind of experience YETI needs as they navigate this global expansion and tariff environment. McMullen will stay on as an advisor through May to ensure a smooth transition.

**ALEX**: Now, let's talk about what's really driving growth here - international expansion. YETI has gone from 2% international sales at their IPO to 21% today, and management thinks their international addressable market is actually larger than the US market.

**JORDAN**: The regional breakdown is fascinating. Europe is showing "exceptional growth" with the UK leading the way, plus expanding traction in Germany and the broader DACH region. Asia is accelerating too - Japan is preparing for ecommerce launch in 2026, and they're e

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