YETI (YETI) Q2 2024 earnings summary

Executive summary

• Q2 2024 net sales rose 15% year-over-year to $463.5M; adjusted net sales (excluding 2023 recall impact) increased 9%, led by strong growth in Coolers & Equipment and international markets.

• Direct-to-consumer sales grew 11% (adjusted 7%), and international sales rose 35% (adjusted 34%), now 17% of total business, with notable gains in Europe, Australia, and Canada.

• Innovation in coolers, drinkware, and new product launches, including cast iron cookware, expanded the product portfolio.

• Opened 21st retail store and first Canadian location in Calgary.

• Integration of Mystery Ranch and Butter Pat acquisitions contributed to product expansion and inventory growth.

Financial highlights

• Q2 2024 net sales: $463.5M (+15%); adjusted net sales: $464M (+9%).

• Gross profit increased 23% to $264.3M; adjusted gross profit up 14% to $268M, with gross margin expanding to 57.7% (adjusted, +280 bps) or 57.0% (GAAP, +360 bps).

• Operating income up 34% to $67.4M; adjusted operating income up 19% to $80M (17.3% of sales).

• Net income up 32% to $50.4M; adjusted net income up 20% to $60M ($0.70 per diluted share, +23%).

• Inventory increased 17% year-over-year to $378M, reflecting new product launches and acquisitions.

Outlook and guidance

• FY2024 adjusted sales expected to increase 8–10% (prior: 7–9%), with international growth approaching 30% and domestic growth in mid-single digits.

• Adjusted gross margin target raised to 58.5% for 2024; adjusted operating margin to reach ~16.5%.

• Adjusted EPS guidance increased to $2.61–$2.65, up 16–18%.

• Capital expenditures forecasted at $50–60M; free cash flow at $150–200M.