YETI HOLDINGS INC (NYSE:YETI) Q3 2025 Earnings: EPS Beats Estimates, Revenue Misses

YETI HOLDINGS INC (NYSE:YETI) reported third-quarter financial results that presented a mixed performance relative to analyst expectations, with earnings per share surpassing estimates while revenue fell slightly short. The market reaction has been cautiously optimistic, with shares showing modest gains in pre-market trading following the announcement.

Earnings and Revenue Performance

The outdoor recreation company reported adjusted earnings per share of $0.61 for the third quarter of 2025, exceeding analyst estimates of $0.5958. This represents a 14% decrease from the $0.71 per diluted share reported in the same quarter last year. The company noted that the current quarter's results included a $0.14 unfavorable net impact from higher tariff costs.

Revenue performance told a different story, with YETI reporting sales of $487.8 million compared to analyst expectations of $489.9 million. This represents a 2% increase from the $478.4 million reported in the third quarter of 2024. The company's performance was characterized by contrasting trends across different business segments and geographic regions.

Key financial highlights from the quarter include:

• Adjusted operating income decreased 16% to $66.6 million
• Gross margin declined 230 basis points to 55.9%, primarily due to tariff impacts
• International sales grew 14% while U.S. sales declined 1%
• Drinkware sales decreased 4% to $263.8 million
• Coolers & Equipment sales increased 12% to $215.4 million

Market Reaction and Outlook

The market response has been measured, with shares gaining approximately 4% in pre-market trading. This suggests investors are weighing the earnings beat against the revenue miss and ongoing margin pressures. The performance contrasts with recent trends, as the stock had declined approximately 3.4% over the past week and 4.5% over the past two weeks.

Looking forward, YETI provided updated guidance for fiscal year 2025, projecting:

• Adjusted sales growth of 1% to 2% (improved from previous outlook of flat to up 2%)
• Adjusted EPS between $2.38 and $2.49 (narrowed from previous range of $2.34 to $2.48)
• Free cash flow of approximately $200 million (increased from previous outlook of $150-200 million)

This outlook compares to analyst estimates of $1.889 billion in sales for the full year 2025. For the upcoming fourth quarter, analysts project revenue of $587.5 million.

Strategic Developments and Capital Allocation

YETI's management emphasized the company's long-term growth strategy during the earnings release, highlighting three core pillars: accelerating product innovation, brand strength, and international expansion. President and CEO Matt Reintjes commented on the "positive momentum" despite what he described as a "highly disruptive macroeconomic backdrop."

The company demonstrated confidence in its financial position through significant capital returns to shareholders, repurchasing 4.3 million shares for $149.9 million during the quarter. Year-to-date repurchases now total 5.0 million shares for $172.9 million. YETI increased its full-year share repurchase target from $200 million to $300 million.

Operational highlights from the quarter included:

• Direct-to-consumer channel sales increased 3% to $288.7 million
• Wholesale channel sales increased 1% to $199.0 million
• Inventory decreased 12% to $324.0 million compared to the prior year quarter
• The company acquired assets related to the Helimix shaker bottle for $38.0 million

The company continues to navigate significant supply chain transformation and tariff-related headwinds while maintaining focus on product innovation and global expansion. Management expressed confidence in their positioning for the holiday season and their ability to execute against long-term growth objectives.

For more detailed earnings analysis and future estimates, visit YETI's earnings page.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. The information presented should not be interpreted as a recommendation to buy or sell any security. Readers should conduct their own research and consult with financial advisors before making investment decisions.