Outdoor lifestyle products brand (NYSE: YETI) met Wall Street’s revenue expectations in Q4 CY2025, with sales up 5.1% year on year to $583.7 million. Its non-GAAP profit of $0.92 per share was 4.1% above analysts’ consensus estimates.

Is now the time to buy YETI? Find out in our full research report (it’s free for active Edge members).

StockStory’s Take

YETI’s fourth quarter was met with a significant negative market reaction despite the company achieving both revenue and non-GAAP earnings ahead of analyst expectations. Management attributed the quarter’s results to strong international momentum—particularly in Europe and Australia—and the ongoing expansion of its Drinkware and Coolers & Equipment segments. CEO Matthew Reintjes highlighted that “[Q4] delivers 5% net sales growth fueled by continued momentum across the YETI brand,” but also acknowledged increased promotional activity and ongoing tariff pressures that weighed on profitability. The company’s operating margin declined year over year, with higher tariffs and increased spending on marketing and technology investments contributing to the margin compression.

Looking forward, YETI’s guidance reflects ongoing caution around tariffs and a promotional consumer environment, with management expecting continued headwinds in the first half of the year before some relief later in 2026. CFO Michael McMullen emphasized that guidance assumes no tariff relief and that cost reduction and selective price increases are the main levers to offset these pressures. The company expects international markets and product innovation to be key sources of growth, while investments in technology, supply chain optimization, and artificial intelligence are intended to drive both consumer engagement and operational efficiency.

Key Insights from Management’s Remarks

Management emphasized that international growth, product innovation, and supply chain shifts were major contributors to the quarter’s performance and are expected to shape upcoming results.

• International expansion momentum: Sales outside the U.S. grew 25% year-over-year in Q4—now representing 23% of total sales—driven by strong performance in Europe, Australia, and early traction in Japan. Management believes international markets offer a larger addressable opportunity than the U.S., and has established dedicated teams and infrastructure to support future expansion.

• Product innovation pipeline: YETI expanded its product portfolio with launches such as the Silo jugs, Yonder shaker bottles, new ceramic formats, and the Scala hike pack family. Management noted that innovation is broadening the company’s market beyond traditional drinkware, creating new use cases and categories.

• Channel and distribution developments: The direct-to-consumer (DTC) channel showed broad-based growth, while wholesale partners remained cautious with inventory planning. Sell-through outpaced sell-in, suggesting healthy end-market demand but continued conservative ordering from U.S. wholesale partners.

• Tariff and supply chain impact: Tariffs were a major margin headwind, especially in the first half of the year, but the company’s multi-country supply chain strategy reduced reliance on China. Management highlighted ongoing efforts to optimize global production and further mitigate cost pressures.

• Leadership transition: CFO Michael McMullen will step down, with Scott Bomar from The Home Depot set to assume the role. Management stated Bomar’s experience in cost discipline and operational efficiency will be valuable as YETI seeks to scale sustainably.

Drivers of Future Performance

YETI’s outlook is shaped by tariff headwinds, international opportunities, and continued investments in product innovation and infrastructure.

• Tariffs and margin management: Management expects gross margin to remain under pressure due to annualized tariffs, especially in the first half of the year. Cost optimization, supply chain efficiencies, and selective price increases are planned to partially offset these impacts, with some margin recovery anticipated in the second half of 2026 if current tariff rates persist.

• International growth as key lever: The company expects high-teen to 20% growth in international markets, with ongoing expansion efforts in Europe, Japan, Australia, and broader Asia. Management is focusing on building wholesale, e-commerce, and corporate sales capabilities to capture these opportunities.

• Product innovation and new categories: YETI is investing in its product development cycle to launch new offerings in drinkware, coolers, and outdoor gear. These innovations are designed to broaden the customer base and increase shelf presence, with upcoming launches in new channels and potential new partnerships.

Catalysts in Upcoming Quarters

In the coming quarters, our analyst team will closely monitor (1) the pace of international sales growth and the success of new market entries such as Japan and Korea, (2) margin trends as YETI laps the peak impact of tariffs and implements cost-saving measures, and (3) progress in product innovation, including the rollout of new categories and expanded shelf space with wholesale partners. Execution on supply chain optimization and digital investments will also be key areas to watch.

YETI currently trades at $47.99, down from $49.43 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).

High Quality Stocks for All Market Conditions

If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.

Don’t wait for the next volatility shock. Check out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).

Stocks that have made our list include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.