Executive Summary

Q4 2024 net sales rose 20% to $127.3M, while gross margin compressed to 32.4% from 37.5% a year ago; diluted EPS was $0.06 vs $0.11 last year, and Adjusted EBITDA was essentially flat at $7.7M .
Management guided FY 2025 net sales to $555–$570M, gross margin to 35–37%, SG&A up low single digits, and Adjusted EBITDA to $86–$92M; guidance excludes any potential tariffs .
Drivers: inventory rebuild after Q3 shortages accelerated Q4 shipments; ocean freight rates elevated and flowed through Q4 P&L; reduced promotions lifted net pricing but weighed scans earlier; Walmart shelf reset created short-term U.S. headwinds .
Catalysts: clarity on ocean freight normalization and U.S. retailer resets; execution of national Vita Coco Treats rollout; mid-teens branded growth trajectory and international expansion momentum .

What Went Well and What Went Wrong

What Went Well

Strong Q4 shipment recovery: net sales +20% to $127M, driven by Vita Coco Coconut Water and private label volumes; net pricing improved with reduced promotions .
Brand momentum: L13-week U.S. retail scans +20% and U.S. share ~41.7%, reflecting healthier inventory and category acceleration; international growth led by the U.K. and Germany .
Strategic positioning: extended Keurig Dr Pepper distribution agreement and secured new production capacity for 2025–2026 to operate at ~80–85% capacity, supporting branded growth flexibility .

What Went Wrong

Margin pressure: consolidated gross margin fell to 32.4% (–510 bps YoY) primarily due to elevated ocean freight, which management expects to remain above 2024 levels in H1 2025 before modest improvement in H2 .
Private label outlook: service-level issues in 2024 create expectation of losing some regions in 2025, with shipment impact beginning in Q2 and deepening thereafter; this is embedded in FY 2025 guidance .
U.S. retail headwinds: Walmart aisle relocation reduced SKUs/space and caused mid-teen weekly sales declines; near-term drag on U.S. scans despite longer-term higher foot traffic potential in the juice aisle .

Financial Results

Core P&L Metrics (Quarterly)

Metric	Q2 2024	Q3 2024	Q4 2024
Revenue ($USD Millions)	$144.116	$132.906	$127.293
Gross Profit ($USD Millions)	$58.737	$51.562	$41.307
Gross Margin %	40.8%	38.8%	32.4%
Net Income ($USD Millions)	$19.093	$19.251	$3.370
Diluted EPS ($USD)	$0.32	$0.32	$0.06
Adjusted EBITDA ($USD Millions)	$32.238	$22.932	$7.727
SG&A ($USD Millions)	$28.756	$30.967	$37.022
Revenue YoY %	+3%	–4%	+20%

Q4 Segment Net Sales Breakdown

Segment / Category	Q4 2023 ($USD '000)	Q4 2024 ($USD '000)
Americas – Vita Coco Coconut Water	$63,396	$81,259
Americas – Private Label	$25,800	$26,003
Americas – Other	$2,368	$2,243
Americas Subtotal	$91,564	$109,505
International – Vita Coco Coconut Water	$8,201	$11,818
International – Private Label	$5,573	$4,556
International – Other	$806	$1,414
International Subtotal	$14,580	$17,788
Total Net Sales	$106,144	$127,293

KPIs

KPI	Americas	International	Total
Q4 2024 CE Volume YoY – Vita Coco Coconut Water	+21.2%	+29.7%	+22.4%
Q4 2024 CE Volume YoY – Private Label	+15.0%	–1.9%	+11.6%
Q4 2024 CE Volume YoY – Other	+18.4%	+226.3%	+33.4%
U.S. L13W Vita Coco Retail Scans ($)	—	—	+20.3%
U.S. Coconut Water Share – Vita Coco (L13W)	—	—	41.7%

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net Sales	FY 2025	N/A	$555–$570M	New
Gross Margin	FY 2025	N/A	35%–37%	New
SG&A	FY 2025	N/A	Low single-digit increase vs 2024	New
Adjusted EBITDA	FY 2025	N/A	$86–$92M	New
Tariffs	FY 2025	N/A	Excluded from outlook; would trigger pricing if broad	New
Net Sales	FY 2024	$500–$510M (Q2 guide)	$505–$515M (Q3 raise)	Raised
Gross Margin	FY 2024	37%–39%	37%–39% (Q4 most severe freight impact)	Maintained (with caution)
Adjusted EBITDA	FY 2024	$76–$82M	$80–$84M	Raised

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 2024)	Previous Mentions (Q3 2024)	Current Period (Q4 2024)	Trend
Ocean freight costs & availability	Volatile; carriers seeking surcharges; expected Q3–Q4 P&L impact; avoiding long-term fixed contracts	Rates spiked in summer; most severe hit in Q4; margins pressured; cautious on indexes	Rates still elevated; H1 2025 higher than 2024; modest H2 improvement; inventory carryover effect	Improving slightly in H2 2025 (from elevated base)
Inventory & supply chain	Tight inventories; transit delays; scans ahead of shipments; rebuild expected by year-end	Replenishment underway; end-Q3 on-water inventory up $20M; recovery continuing	Q4 replenishment rebuilt channel; healthy year-end inventory; aim to add buffer into summer	Improving
Promotions & pricing	Reduced cadence due to inventory constraints; may normalize in 2025; potential pricing if freight persists	Q4 most severe freight impact; promotions reduced (e.g., club)	U.S. branded price increase planned for summer; net pricing roughly flat for FY25 as promotions normalize H2	Normalizing H2 2025
Walmart reset & U.S. distribution	N/A	Anticipated resets; ACV/TDP affected by inventory	Walmart aisle move reduced SKUs/space; mid-teen weekly sales declines; working to improve availability; net distribution expected to grow with spring resets	Near-term headwind; longer-term opportunity
International growth	UK, Germany strong; #1 branded in Germany	Western Europe expansion; faster category awareness; underdeveloped markets	Europe strong (UK, Germany); stepping up investments; international expected to contribute more	Accelerating
Innovation: Treats & Juice	Treats promising test; Juice growing in convenience	Treats broader 2025 rollout; Juice expanded to mass/food	Treats national rollout (new Orange & Creme); Juice retail share gains	Expanding
Tariffs/macro	Potential pricing if broad tariffs applied	Not planning for tariffs in guide; would adjust sourcing/price with long lead times	FY25 guidance excludes tariffs; would take pricing; diversified sourcing (Philippines, Brazil; co-pack in CA/MX)	Watchful
Capacity & sourcing diversification	Securing 2025 capacity; avoiding fixed-rate ocean contracts	Added capacity for 2025–2026; aim to run 80–85%	New facilities online; hit 80–85% in H2 2025; diversification in Asia lanes being evaluated	Improving flexibility
Health/hydration positioning	Occasion-based marketing (smoothies, cocktails, greens)	Category mainstreaming; multipacks growth	Pivot to “active hydration” messaging; 3x electrolytes vs sports drinks; no packaging change planned	Strategic emphasis increasing

Management Commentary

“Net sales in the quarter were up 20%, driven by growth of Vita Coco Coconut Water and private label shipments, benefiting from an acceleration of growth in the coconut water category and improvement in available inventory.” – CEO Martin Roper .
“U.S. branded scan growth of 20% for the last 13-week period ending 2/16/2025… With more normal inventory levels… I am very excited for what is to come in 2025.” – Executive Chairman Michael Kirban .
“Our branded promotional activity during the quarter was reduced… resulting in reported net price improvements. Even so, our fourth quarter gross margins decreased… due to more expensive ocean freight.” – CEO Martin Roper .
“We recently extended our Keurig Dr Pepper distribution agreement… a testament to a great partnership… 15 years strong.” – Executive Chairman Michael Kirban .
“We expect net sales between $555 million and $570 million… gross margins for the full year of 35% to 37%… delivering adjusted EBITDA of $86 million to $92 million.” – CFO Corey Baker .

Q&A Highlights

Category growth and share: Management expects U.S. category mid-teens LT growth, currently accelerated; brand aims to hold/gain share via education, trial, retail execution, and innovation .
Distribution outlook: Largest upside in convenience; Walmart move is a short-term drag but seen as a long-term opportunity with higher foot traffic; net distribution expected to improve with spring resets .
Pricing and promotions: U.S. price increase letters in Q1 with market execution in summer; FY25 net pricing impact ~flat as promotions normalize H2 .
Freight trajectory: H1 2025 margins lower vs 2024 given elevated rates; modest H2 improvement expected; cautious stance on long-term freight contracts .
Capacity and inventory: Additional 2025 capacity secured; target 80–85% utilization by H2; distributor inventory build into summer planned if feasible .
Foodservice channel: Underdeveloped but growing (hotels, hospitals, campuses); multi-year build opportunity .
Tariffs: Guidance excludes tariffs; broad import tariffs would be met with pricing; diversified sourcing/capacity over time .

Estimates Context

Wall Street consensus (S&P Global) for Q4 2024 EPS/revenue/EBITDA was unavailable at the time of this analysis due to an API limit; therefore, we cannot quantify beats/misses vs consensus for this quarter. Where estimate comparisons are absent in tables above, they reflect this unavailability.

Key Takeaways for Investors

Quality growth amid cost headwinds: Strong Q4 shipment rebound and double-digit brand scans confirm demand; near-term margin pressure is external (freight), with management signaling H2 improvement and FY25 gross margin 35–37% .
2025 setup: Mid-teens branded growth targeted, supported by normalized promotions, U.S. price action in summer, and added production capacity; private label softness offsets some top-line but frees capacity for higher-margin branded SKUs .
U.S. retail dynamics: Walmart reset is a transitory drag with long-term upside; broader spring resets should expand points of distribution; watch Q2 execution .
International as a second engine: Continued momentum in UK/Germany with plans to invest and scale in underpenetrated markets; monitor segment mix and margins .
Innovation halo: National rollout of Vita Coco Treats and continued Juice growth enhance occasions and brand reach; track adoption, margin mix, and shelf expansion .
Risk monitor: Ocean freight normalization pace, tariff outcomes, and private label attrition cadence (expected from Q2 2025) are key variables for FY25 trajectory .
Actionable: Near-term focus on margin trajectory (freight costs flowing through H1), U.S. price increase execution in summer, and Q2 distribution resets; medium-term thesis centers on branded mix expansion, international acceleration, and capacity-driven reliability .

Vita Coco Company, Inc. (COCO)·Q4 2024 Earnings Summary