Vita Coco Earnings: 37% Surge in Sales and Raised 2025 Outlook
- Hardik Shah
- Oct 29
- 4 min read
TL;DR
💧 Revenue Strength: Net sales jumped 37% to $182M, led by 42% growth in Vita Coco Coconut Water.
📈 Margin Trends: Gross margin held at 38%, absorbing tariff and cost pressures via pricing actions.
🚀 Forward Outlook: Full-year sales guidance raised to $580–$595M and EBITDA to $90–$95M, underscoring strong global demand.
Business Overview
The Vita Coco Company (NASDAQ: COCO) is a better-for-you beverage platform best known for its flagship Vita Coco Coconut Water brand. Founded in 2004 and a Certified B Corporation, Vita Coco leads the U.S. coconut water market and has been rapidly expanding across Europe and other regions.
The portfolio includes:
Vita Coco Coconut Water — the growth engine, known for electrolytes and hydration.
Private Label Coconut Water — strategic retail partnerships.
Vita Coco Treats — a new coconut milk–based snack beverage line.
PWR LIFT — a protein-infused functional water brand.
The company’s asset-light model, global supply chain, and commitment to sustainable sourcing underpin its competitive advantage across retail, e-commerce, and foodservice channels.
Vita Coco Earnings Q3'25
Drivers:
Vita Coco Coconut Water grew 42%, supported by pricing and 30% volume growth.
International segment up 48%, led by strength in the U.K. and Germany.
New products, notably Vita Coco Treats, surged 182% on rollout momentum.
Gross margins softened modestly due to tariffs and input costs, but these were partly offset by price increases and lower ocean freight.
“Our exceptionally strong shipment performance in the third quarter benefited from very strong demand for Vita Coco Coconut Water and great execution from our teams,” said CEO Martin Roper.
Forward Guidance
Updated FY2025 Outlook
Net Sales: $580M–$595M (previously lower range).
Gross Margin: ~36%, absorbing tariff and cost headwinds.
Adjusted EBITDA: $90M–$95M, reflecting stronger topline momentum.
Tariff Impact: ~$14M–$16M increase in cost of goods for the year.
Risks & Opportunities
Risks: U.S. tariff volatility (notably 50% on Brazil coconut water), potential competitive pricing pressure, FX fluctuations.
Opportunities: Freight cost tailwinds, international expansion, potential tariff exemptions for natural-resource imports.
Operational Performance
Supply Chain: Stable costs and improved fill rates vs. 2024. The company leveraged its diversified sourcing from the Philippines, Brazil, Thailand, and Sri Lanka to mitigate tariff impacts.
Inventory: Healthy at $84M; cash position robust at $204M with no debt.
Private Label: Down 13% in the Americas but showing recovery signs, with key retail wins expected in 2026.
Tariff Management: Actively diverting Brazil production to Canada and Europe to offset U.S. tariff exposure.
“We are developing and executing plans to divert some of our Brazil production to Canada and Europe and to cover U.S. demand more completely from Asia,” noted Roper, emphasizing the company’s agility under trade uncertainty.
Market Insights
The coconut water category grew 22% in the U.S. and over 100% in Germany, reinforcing Vita Coco’s leadership and first-mover advantage.
Retail partnerships (e.g., Walmart shelf resets) are expanding distribution and household penetration.
Competitive intensity remains limited in key markets like the U.K., where Vita Coco holds >80% market share.
Ocean freight softness expected to provide margin relief into 2026.
Consumer Behavior & Sentiment
Consumer adoption of coconut water is accelerating from niche to mainstream:
Strong gains in household penetration and repeat consumption.
Vita Coco Treats attracting new entrants into the brand ecosystem.
The company reported growing engagement across all income cohorts and an uptick in value-seeking but health-conscious consumers.
“Coconut water is transitioning from niche to mainstream, and we are at the forefront of that trend,” said Executive Chairman Mike Kirban.
Strategic Initiatives
International Expansion: Doubling down in the U.K. and Germany, with new distribution buildouts in France, Spain, and Benelux.
Product Innovation: Successful launch of Vita Coco Treats; continued R&D in functional hydration.
Tariff Mitigation: Geographic diversification of supply and proactive pricing strategy.
Operational Leverage: Asset-light structure enabling scalable growth with high cash conversion.
Capital Allocation
Cash: $204M; No debt.
Buybacks: $10.2M repurchased YTD; $42M remaining authorization.
CapEx: $4.9M YTD focused on supply chain and capacity expansion.
M&A: Evaluating disciplined, value-accretive targets aligned with “better-for-you beverage” strategy.
Dividend: None announced — focus remains on reinvestment and shareholder value via growth and buybacks.
The Bottom Line
Vita Coco continues to outperform the beverage sector, combining strong demand with agile execution amid tariffs and inflation.
Key watchpoints for investors:
Tariff trajectory and potential waivers impacting 2026 gross margins.
Sustained international growth in Europe as consumption scales.
Distribution expansion in the U.S. post-Walmart reset and rollout of Treats.
The company’s robust balance sheet, brand leadership, and disciplined execution position it for another year of double-digit growth and resilient profitability.
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