Vital Farms, Inc. Q4 FY2025 earnings call

• Leadership update: Founder Matt O'Hare retired, Russell Diaz Canseco became executive chairperson and CEO. - 2025 results: Net revenue $759.4 million, adjusted EBITDA $114 million. Operations: Rebuilt egg inventory, brought third ECS production line online, building both lines at Seymour concurrently. Commercial: Record revenue year, gained volume share in premium shell egg brands. Farm network expanded to over 600 small farms. Completed ERP implementation with no unplanned shipment interruptions. Marketing campaigns drove brand awareness to 34%. - 2026 focus: Building foundation, stable retail inventory, measured growth, prioritizing profitable velocity, working with retail partners to expand shelf space, expecting short-term noise in first half but clean runway in second half, CapEx for capacity and infrastructure.

Full year 2025 net revenue grew more than 25% to $759.4 million. Adjusted EBITDA exceeded $100 million for the first time, growing 31.6% to $114 million. Fourth quarter revenue was $213.6 million, and adjusted EBITDA was $29.2 million. Gross profit was $285.7 million, or 37.6% of net revenue. SG&A expenses were $159.4 million, or 21% of net revenue. CapEx for the year was $82 million. Fiscal year 2026 net revenue guidance is $900 to $920 million, adjusted EBITDA guidance is $105 to $115 million, and CapEx is $140 to $150 million.

• 2026 net revenue guidance: $900 - $920 million (over 20% growth). - Adjusted EBITDA guidance: $105 - $115 million. - CapEx guidance: $140 - $150 million. - Long-term target unchanged: $2 billion net revenue by 2030 with adjusted EBITDA margin 15% - 17%.

Q: About expectations for the year relative to Investor Day, given volatility.

A: Russell said they want to set up for success, guide gives room and flexibility. Tilo added it's a volatile environment but they're outperforming the category.

Q: Impact from ERP.

A: Short-term dislocation, but conversations with retailers are fruitful and shifting to growth together.

Q: Squaring macro environment with core consumer.

A: Not seeing big change in core consumers, but category has disruption with other players competing for attention.

Q: EBITDA guidance margin contraction.

A: Price mix positive but promoting to convert awareness, expecting operating expense leverage.

Q: First quarter expectations.

A: Shipments usually align with consumption but first quarter has measured start.

Q: Brand awareness acceleration.

A: Consistent marketing approach during supply constraints helped drive awareness.

Q: Share repurchase.

A: Board authorized $100 million share repurchase, listening to shareholders and looking to create shareholder value.

Q: Industry egg supplies recovery.

A: Conviction strong due to continued volume share gain.

Q: Amazon Whole Foods units.

A: Exciting opportunity to continue partnership and grow.

Q: Pasture-raised category.

A: Continues to be strong, gaining volume and dollar share.

Q: Promotional increase magnitude.

A: Return to normal cadence, not stronger than projected.

Q: Vital buyers composition.

A: No reason to think ability to attract households has changed.

Q: EBITDA margin bridging.

A: Still on track to long-term targets, benefits of scale in operating expenses.