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STRYVE FOODS, INC. (SNAX)·Q3 2024 Earnings Summary

Executive Summary

  • Net sales grew 36.4% year-over-year to $5.70M, with gross margin expanding 8.4pp to 21.7%; adjusted EBITDA loss narrowed 31.5% YoY to $(1.72)M .
  • Sequentially, Q3 revenue of $5.70M trailed Q2 ($6.18M) due to working capital constraints limiting shipments despite strong retail sell-through, while margins remained above prior-year levels .
  • Management withdrew FY24 guidance given timing of the November equity raise; previously, FY24 net sales were guided to $23–$26M; the $2.9M gross capital raise supports inventory build and service-level recovery ahead of major distribution wins beginning Q1’25 .
  • Catalysts: chainwide national retail placement in Q1’25, Dot Foods redistributor partnership to streamline fulfillment, and continued velocity outperformance; risks include liquidity needs to support growth and beef input cost pressure .

What Went Well and What Went Wrong

  • What Went Well

    • Retail consumption and velocity drove 36.4% YoY net sales growth to $5.70M; gross margin rose to 21.7% vs. 13.3% last year as mix and productivity improved .
    • Expanded placements across BJ’s Wholesale, Wawa, Circle K and others; secured chainwide distribution with a leading national retailer for thousands of doors beginning Q1 2025 .
    • CEO: “Our achievements in expanding distribution and driving margin improvements demonstrate the power of our strategy… foundation for sustainable growth and profitability in the quarters to come” .

  • What Went Wrong

    • Demand outpaced ability to supply due to working capital constraints, not capacity; shipments undershot run-rate demand from existing distribution .
    • Continued net loss $(3.11)M and EPS $(0.95); stockholders’ equity turned negative ($(6.38)M) amid elevated interest expense and leverage .
    • Beef commodity price pressure persisted YoY, partially offset by pricing/mix and productivity, limiting further margin expansion in Q3 vs. Q2’s 27.4% .

Financial Results

  • Quarterly progression (oldest → newest):
MetricQ1 2024Q2 2024Q3 2024
Revenue ($USD Millions)$4.60 $6.18 $5.70
EPS (Basic & Diluted) ($USD)N/A$(0.91) $(0.95)
Gross Margin (%)22.1% 27.4% 21.7%
Gross Profit ($USD Millions)$1.20 $1.69 $1.24
Operating Loss ($USD Millions)$(3.00) $(2.23) $(2.31)
Net Loss ($USD Millions)$(3.90) $(2.96) $(3.11)
Adjusted EBITDA ($USD Millions)$(2.30) $(1.55) $(1.72)
  • Year-over-year (Q3 2024 vs. Q3 2023):
MetricQ3 2023Q3 2024
Revenue ($USD Millions)$4.18 $5.70
YoY Revenue Growth (%)—36.4%
Gross Margin (%)13.3% 21.7%
Gross Profit ($USD Millions)$0.56 $1.24
Operating Loss ($USD Millions)$(3.66) $(2.31)
Net Loss ($USD Millions)$(4.78) $(3.11)
EPS ($USD)$(2.14) $(0.95)
Adjusted EBITDA ($USD Millions)$(2.52) $(1.72)

  • Estimates comparison: S&P Global consensus estimates for Q3 2024 and prior quarters were unavailable for SNAX; attempted retrieval returned no mapping. Therefore, estimate comparison is not provided (see Estimates Context) .

  • Segment breakdown: The company does not report segment revenues; performance drivers cited include mix, pricing, productivity, and retail velocity across Stryve, Kalahari, Vacadillos .

  • KPIs (selected):

    • Stryve brand retail velocity (SPINS): +24.7% (24 weeks), +35.7% (12 weeks), +51% (4 weeks), supporting distribution wins .
    • New placements: BJ’s Wholesale; expanded distribution across multiple convenience and grocery chains .
    • Dot Foods redistributor partnership to start Q4’24 to enhance service and fulfillment .
    • Capital raise: $2.9M gross proceeds to support inventory build and service-level recovery .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Sales ($USD Millions)FY 2024$23–$26 Guidance withdrawn / not providing Withdrawn

Earnings Call Themes & Trends

TopicQ1 2024 (Prior-2)Q2 2024 (Prior-1)Q3 2024 (Current)Trend
Working capital & liquidityLiquidity tight; convertible bridge notes; need external capital to fund inventory ramp Still reliant on external capital; left dollars on table due to constrained supply Demand > supply due to working capital; $2.9M raise helps, may need more for Q1’25 wins Improving access, still constrained
Distribution expansionRegained Costco SE rotation for Vacadillos; expect acceleration Announced timing of Q2 call; continued momentum and expanded placements BJ’s, Wawa, Circle K; chainwide national retailer in Q1’25 Accelerating
Supply chain/operationsManufacturing quality upgrades; packaging rollout mid-way Productivity gains; operating leverage as scale improves Dot Foods partnership to streamline distribution; improved logistics Improving efficiency
Commodity beef pricesHigher beef prices vs prior year; tactical response Considerably higher input costs YoY; still achieved margin gains Higher beef prices vs prior year; margins improved on mix/productivity Persistent headwind, mitigated
Packaging & velocityVelocity surge from new packaging; Stryve brand leading 3/4 packaging transition; velocity outperformance supports distribution Velocity continues to outpace category; shipments lag consumption Positive momentum
Innovation/pet treatsHuman-grade pet treat pipeline; leverage raw materials Pet treat strategy gaining demand; explore co-man Launch of “High Steaks” pet brand; multi-SKU retail rollout Building
Financing actionsConvertible notes; extended line of credit $3.0M convertible notes closed in Q2 $2.9M public offering (equity + warrants) closed Nov 12 Active financing
Consumer trends (GLP-1)Not mentionedNot mentionedManagement cites GLP-1 craze as tailwind for high-protein, low-sugar Emerging tailwind
Guidance policyFY24 net sales $24–$30M reiterated Revised to $23–$26M Withdrew guidance for remainder of FY24 More conservative

Management Commentary

  • CEO focused on “profitable growth, operational efficiency, and cost discipline,” citing distribution wins and margin improvements: “The initiatives we’ve implemented provide a strong foundation for sustainable growth and profitability in the quarters to come” .
  • CFO highlighted demand outpacing supply due to working capital, not capacity: “Run rate demand… is meaningfully higher than what we shipped this quarter,” expecting stronger service levels as capital and Dot Foods partnership take hold .
  • Strategy pillars: grow core via velocity and distribution, responsible innovation (including pet treats), flawless execution, lower cost-to-serve, and cash management across procurement to balance sheet .

Q&A Highlights

  • Breakeven framework: At $9–$10M quarterly net sales, management expects adjusted EBITDA inflection with gross margin “high 30s… potentially even low 40s” depending on mix; target to get there below $10M .
  • Capital solutions: Team remains “creative” (convertible notes, equity) to fund working capital; still reliant on external capital until scale; aim for least dilution .
  • Distribution/pricing: Costco SE rotation designed for “win-win-win” with appropriate unit economics; early velocities “very strong,” supporting broader regional expansion .

Estimates Context

  • S&P Global consensus estimates for SNAX were unavailable due to missing mapping; we attempted retrieval but could not obtain EPS or revenue consensus for Q3 or prior quarters. As a result, estimate comparisons and beat/miss assessments versus Wall Street consensus are not provided. Analysts may reassess FY24 trajectories following guidance withdrawal and liquidity-timed shipment constraints .

Key Takeaways for Investors

  • Strong consumer demand and velocity underpin 36.4% YoY revenue growth and margin expansion; the growth narrative is consumption-led rather than mere distribution adds .
  • Sequential softness vs. Q2 reflects timing of capital and inventory, not category health or capacity; near-term upside as service levels normalize with Dot Foods and fresh working capital .
  • Clear path to adjusted EBITDA breakeven at ~$9–$10M quarterly net sales with gross margins “high 30s/low 40s” suggests operating leverage as distribution gains ramp in Q1’25 .
  • Liquidity remains the principal execution risk; management is actively pursuing additional capital solutions to support large Q1’25 distribution on-boarding .
  • Margin drivers—mix, pricing, productivity—offset beef inflation; continued margin trajectory depends on scaling volumes and utilization improvements .
  • Pet treats (“High Steaks”) and co-manufacturing represent incremental, potentially capital-light growth avenues .
  • Narrative moving the stock: imminent chainwide placement and Dot partnership (positive), but guidance withdrawal and equity raise signaling funding needs (negative/neutral) near term .

Appendix: Additional Relevant Press Releases in Q3 2024

  • Strategic redistributor partnership with Dot Foods; major chainwide distribution win for Q1 2025 .
  • New and expanded distribution across BJ’s, Wawa, Circle K and many others; preliminary Q3 metrics foreshadowed 30–35% YoY growth .
  • Public offering pricing and closing: $2.9M gross proceeds; warrants structure and intended use for working capital .

Notes

  • Non-GAAP: Adjusted EBITDA and adjusted EPS reconciliations provided in press release; adjusted EBITDA loss improved to $(1.72)M in Q3 from $(2.52)M YoY .
  • Cross-reference: All figures reconciled with Q3 press release and call commentary; Q2/Q1 context included to show trajectory .