YETI (YETI) 7 Nov 24 2024 Q3 Earnings call transcript

In the third quarter of fiscal 2024, YETI Holdings delivered a robust performance, showcasing impressive growth across its product portfolio and international markets. With a strategic focus on brand engagement, innovation, and global expansion, YETI is well-positioned to capitalize on emerging opportunities and maintain its competitive edge.

Product Innovation and Expansion

Matthew Reintjes, President and CEO, highlighted the company's strong performance in the quarter, attributing the growth to a successful execution of strategic priorities. YETI's net sales increased by 10% in the quarter, demonstrating the success of its product line expansion and the strong demand for its offerings. The company's Drinkware segment, in particular, has been a standout performer, with several highly anticipated launches in bar and tableware. The Coolers & Equipment division also saw solid performance from both legacy and newer products, underscoring YETI's commitment to innovation and diversification.

Global Growth and Strategic Supply Chain Initiatives

YETI's international business has been a significant growth driver, with over 30% growth in Q3 2024 outside the United States. The company's strategic supply chain expansion initiatives, including the establishment of new Drinkware facilities outside of China, are crucial to supporting its growing global business and positioning for long-term success. By the end of 2025, approximately 50% of YETI's Drinkware capacity will be located outside of China, reflecting the company's commitment to cost and service optimization and global scale.

Brand Engagement and Strategic Partnerships

YETI's brand engagement efforts have been a key contributor to its success, with a global reach that extends to various events and partnerships. The company's participation in events such as the YETI Open bass-fishing tournament, The Game Fair, and culinary activations highlights its commitment to bridging to global audiences and creating brand and product residents. Strategic partnerships with industry magazines like Thrasher and the World Surf League further solidify YETI's presence in key markets and underscore its ability to engage with diverse consumer segments.

Looking Ahead: Strategic Priorities and Challenges

As YETI moves into the holiday season, the company remains confident in its outlook, supported by strong demand drivers and high-quality growth. However, the company also acknowledges the challenges posed by a more discerning consumer base and a challenging U.S. market. YETI's strategic priorities, including the expansion of brand reach and engagement, greater product diversification, and international expansion, remain in focus as the company navigates these challenges and positions itself for long-term success.

In conclusion, YETI's strong performance in the third quarter of fiscal 2024 underscores its ability to execute strategic initiatives and capitalize on growth opportunities. With a focus on product innovation, global expansion, and strategic partnerships, YETI is well-positioned to continue its growth trajectory and maintain its competitive edge in the market.