Executive Summary

Q4 2024 delivered strong top-line and profitability: net revenue $166.0M (+22.2% reported; +30% like-for-like), gross margin 36.1% (+280 bps YoY), net income $10.6M (+46.8%), and Adjusted EBITDA $19.1M (+37%) .
FY24 exceeded $600M in net revenue ($606.3M, +28.5%) with gross margin 37.9% (+352 bps) and Adjusted EBITDA $86.7M (+79%), underpinned by volume growth and price/mix, scale, and operational efficiencies .
FY25 guidance: at least $740M revenue (+22% vs FY24), at least $100M Adjusted EBITDA (+15%), and $50–$60M capex; H1 supply constraints to give way to H2 acceleration as new farms and an additional grading line come online in Q4 2025 .
Management reconfirmed long-term targets: $1B net revenue by 2027 with ≥35% gross margin and 12–14% EBITDA margin; near-term cadence skewed to H2 2025 as supply improves amid industry-wide HPAI constraints .

What Went Well and What Went Wrong

What Went Well
- Broad-based growth and margin expansion: Q4 net revenue +22.2% (+30% like-for-like) and gross margin up 280 bps to 36.1%; FY24 gross margin 37.9% (+352 bps) on scale, mix, efficiencies, and favorable conventional commodity and diesel costs .
- Supply chain build-out and farm network scale: ~125 new family farms added in 2024 to >425; hens grew from 5.4M to 7.7M; capacity expansion via new MOBA grading line at Egg Central Station (ECS) increasing capacity ~30% by Q4 2025 and Seymour, IN facility targeting early 2027 .
- Brand strength and butter recovery: aided brand awareness up to 26% in 2024 (from 23% in 2023), household penetration to ~14M homes, buy rate +12%; butter returned to growth with 2024 sales +11% and nearly doubled quarterly sales in Q4 .
- Management quote: “We expect our business to accelerate in the second half of the year as we add to our supply, helping drive us toward our ambitious net revenue and adjusted EBITDA guidance for 2025 and beyond.” – CEO Russell Diez-Canseco .
What Went Wrong
- Near-term supply constraints: Industry HPAI losses (~40M layers in 2024 and >27M hens lost less than two months into 2025) limit early-2025 growth; Vital expects slower growth in H1, particularly Q1, before H2 acceleration as supply builds .
- EBITDA margin headwind vs 1H24 run-rate: FY25 Adjusted EBITDA guidance implies lower margin vs the exceptional 1H24, with sequential margin improvement expected vs 2H24 run rate; factors include weather disruptions, less efficient scheduling under supply constraints, and feed cost upticks flowing through with a lag .
- Promotional and operating cost investments: Higher promotional activity and personnel/marketing investments partially offset gross profit expansion in Q4 and FY24 as the company scaled capabilities and brand support .

Financial Results

Metric	Q4 2023 (14 wks)	Q3 2024 (13 wks)	Q4 2024 (13 wks)
Net Revenue ($M)	$135.811	$145.002	$165.989
Gross Margin (%)	33.3%	36.9%	36.1%
Net Income ($M)	$7.210	$7.446	$10.582
Diluted EPS ($)	$0.17	$0.16	$0.23
Adjusted EBITDA ($M)	$13.894	$15.238	$19.086
Adjusted EBITDA Margin (%)	10.2%	10.5%	11.5%

YoY (Q4 2024 vs Q4 2023): Revenue +22.2% (reported), +30% like-for-like (14 vs 13 weeks); GM +280 bps; EPS +$0.06; Adj. EBITDA +$5.2M .
QoQ (Q4 2024 vs Q3 2024): Revenue +$21.0M; GM -80 bps; EPS +$0.07; Adj. EBITDA +$3.85M .

KPIs and Commercial Metrics

KPI	2023	2024
Aided Brand Awareness (%)	23%	26%
Household Penetration (Homes, M)	~11.7M (implied)	>14.0M
Buy Rate ($ per HH)	$32.20	$36.06
Purchase Frequency (Trips/HH)	3.5	3.7
Spend per Trip ($)	$9.37	$9.84
Heavy Buyers (% of HH ≥8x/yr)	11%	13%
Egg TDPs (MULO+)	119	127
Butter TDPs (MULO+)	44	54
Velocity ($/store/week)	$124	$171

Balance Sheet and Cash Flow (FY24)

Cash, cash equivalents and marketable securities: $160.3M; no debt .
Operating cash flow: $64.8M (FY24) vs $50.9M (FY23) .
Capex: $28.6M (FY24), below guidance as some spend shifted to 2025 .

Segment breakdown: Not disclosed; Vital Farms reports as a single business with product commentary (eggs and butter) but no segment financials .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net Revenue	FY2025	N/A	≥$740M (+22% vs FY24)	New
Adjusted EBITDA	FY2025	N/A	≥$100M (+15% vs FY24)	New
Capex	FY2025	N/A	$50–$60M	New
Long-term Net Revenue	2027	$1B target	$1B target reaffirmed	Maintained
Long-term Gross Margin	2027	≥35%	≥35% reaffirmed	Maintained
Long-term EBITDA Margin	2027	12–14%	12–14% reaffirmed	Maintained

Additional cadence commentary: H1’25 slower growth due to supply constraints; H2’25 acceleration as new farms and new ECS grading line come online Q4’25 .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 & Q3 2024)	Current Period (Q4 2024)	Trend
Supply/Capacity & HPAI	Maintenance at ECS in Q3; planning Seymour (IN) for early 2027; adding farms; industry tightening; prudent cadence	H1’25 supply constraints; H2’25 acceleration; new MOBA grading line +30% ECS capacity by Q4’25; minimal HPAI farm incidents at VITL (0 in 2025 YTD; 4 since 2022)	Tight near-term; improving 2H’25
Pricing/Mix	Mix driving Q3 price/mix; organic SKUs gaining; limited link to commodity eggs	Q4 price/mix ~7% internally (vs scanner ~14%); retailers took some price not flowing to VITL	Mix-led; cautious on price
Butter Business	Relaunch (Irish sourced), back to growth; Q3 butter +15.7% in scanner data	2024 butter sales +11%; Q4 nearly doubled QoQ; GM Butter GM from narrative improving	Improving trajectory
Brand/Marketing	Step-up 2H spend; women’s sports campaign; plan 5–6% sales on marketing LT	New “Good Eggs. No Shortcuts.” campaign; aided awareness 26%; household penetration >14M; sustained 5–6% of sales spend	Strengthening
Distribution/Velocity	TDPs rising; expanded SKUs; strong velocities	Egg TDPs 127; butter TDPs 54; velocity $171/store/week (historic high)	Positive
Scanner vs Internal Data	Noted mismatch at times (setup)	Clarified scanner vs internal price/mix discrepancy; retailers capturing some price	Clarified
Long-term Targets	2027 $1B, ≥35% GM, 12–14% EBITDA margin reiterated	Reaffirmed	Maintained

Management Commentary

CEO strategic focus: “We expect our business to accelerate in the second half of the year as we add to our supply… toward our ambitious net revenue and adjusted EBITDA guidance for 2025 and beyond.” .
Supply chain resilience and HPAI: “Less than 2 months into 2025, more than 27 million hens have died… we’ve had 0 outbreaks in 2025… and only one outbreak in the trailing 12 months.” – CEO .
Capacity expansion: “We anticipate this new [grading] line will expand our capacity [at ECS] by 30% by the end of 2025.” – CEO .
Butter trajectory: “Butter had a great performance in 2024, with sales up 11% for the year, with the brand nearly doubling its quarterly sales in Q4.” – CMO/GM Butter .
Guidance cadence: “Our 2025 adjusted EBITDA guidance implies a decline in margin for the year… compared to the run rate in the second half of 2024, we anticipate the adjusted EBITDA margin to improve in 2025.” – CFO .

Q&A Highlights

2025 cadence: Q1 to be slowest growth quarter due to supply; volumes to accelerate each quarter as farms come online; guidance embeds H2 acceleration .
Pricing/mix: Internal Q4 price/mix ~7%; scanner overstates due to retailer pricing; limited plan for price to drive growth in 2025 .
HPAI exposure: 0 outbreaks in 2025 YTD; only four incidents since 2022 across ~425 farms; biosecurity vigilance cited .
ECS grading line integration: Extensive planning underway; aiming for a smooth transition with minimal disruption .
Accelerator farms: 10–15 “R&D” farms to trial best practices; low single-digit % of production; expected LT margin benefits from productivity gains .

Estimates Context

S&P Global consensus (EPS, revenue, margins) for Q4 2024 was unavailable at request time due to data limits, so we cannot quantify beats/misses versus Wall Street. We will update with S&P Global estimates on request once accessible.

Key Takeaways for Investors

Durable growth and margin execution: Vital delivered double-digit revenue growth and margin expansion in Q4 and FY24, with strong Adjusted EBITDA leverage despite elevated brand investments .
H1’25 caution, H2’25 acceleration: Expect slower growth early in 2025 on supply tightness, then acceleration as new farms ramp and a new ECS grading line expands capacity by ~30% in Q4 2025 .
Mix-led tailwinds: Organic portfolio growth and higher-value SKUs (e.g., 18-count organic) support sustained mix benefits; limited reliance on pricing as a driver in 2025 .
Brand momentum = commercial advantage: Rising awareness, penetration, and velocity, plus butter back to growth, should underpin continued top-line resilience even amid category volatility .
Long-term path intact: $1B by 2027 with ≥35% GM and 12–14% EBITDA margin reaffirmed; Seymour (IN) facility targeted early 2027 provides next leg of capacity .
Investment focus: Expect higher capex ($50–$60M) for production line, Seymour groundwork, accelerator farms, and digital transformation; funded by cash and operating cash flow .
Data nuance: Scanner vs internal data can diverge (retailer pricing actions); management will provide Circana MULO+ context going forward to align external analyses with internal trends .

Appendix: Additional Context and Drivers

Q4 revenue drivers: $19M volume-related growth plus price/mix; like-for-like growth +30% excluding prior-year extra week .
Gross margin drivers: scale, operational efficiencies, favorable conventional commodity and diesel; partially offset by promotions and crew investments .
Balance sheet strength: $160.3M cash/marketable securities, no debt, gives flexibility to fund capex and expansion .
Industry dynamic: Egg shortages from HPAI elevate demand; VITL’s diversified small-farm network and biosecurity discipline have limited incidents to date .

Note: Consensus estimates from S&P Global were unavailable at time of analysis; results vs Street estimates could not be assessed.

Vital Farms, Inc. (VITL)·Q4 2024 Earnings Summary