Freshpet raises 2026 outlook as Q2 sales jump 15.5%

Freshpet reported second-quarter net sales of $305.6 million, up 15.5% from a year earlier, and raised its 2026 outlook.

"Our second quarter performance demonstrates the strength and resilience of our business model," Billy Cyr, chief executive officer at Freshpet, said. "Despite economic headwinds and new competitors, we grew significantly faster than the category, improved margins, and produced strong cash flow."

Adjusted EBITDA rose to $52.2 million from $44.4 million, with the margin expanding to 17.1% of net sales from 16.8%. Adjusted gross profit reached $148.4 million, or 48.6% of sales, up from 46.9% a year earlier, helped by lower input costs and improved cost leverage on plant expenses, partially offset by higher quality costs tied to new technology lines. Net income climbed to $19.5 million from $16.4 million, aided by a $4.5 million gain on an equity investment. Volume gains of 15.7% drove the sales increase, partially offset by a 0.2% unfavorable price/mix. Selling, general and administrative expenses rose to $107.0 million, or 35.0% of sales, from 34.1%, reflecting higher logistics costs and variable compensation accrual.

For the first six months, net sales rose 14.3% to $603.2 million, with adjusted EBITDA of $90.1 million versus $79.9 million a year earlier. Net income jumped to $68.0 million from $3.7 million, boosted by a $66.6 million gain on the sale of an equity investment. Cash from operations reached $84.8 million, up $46.1 million, and free cash flow turned positive at $27.4 million from a $21.2 million outflow. The company ended June with $350.8 million in cash and $398.4 million of debt, after repurchasing $54.4 million of shares.

Freshpet raised its full-year 2026 net sales and adjusted EBITDA guidance and lifted its long-term adjusted gross margin target to above 49 percent, while updating 2027 financial targets. The raise points to management's expectation that fresh pet food demand will keep outpacing the broader category, even as rivals including Colgate-Palmolive's Hill's Pet Nutrition expand in the space. The company also marked its 20th anniversary with a planned leadership transition, with co-founder Scott Morris moving to an advisory role and Nicki Baty appointed president and chief operating officer. Investors will watch the earnings call at 8 a.m. Eastern on Aug. 5 for updated segment detail and margin trajectory.

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