Vita Coco Earnings: Coconut Water Momentum Drives Growth
- 2 days ago
- 4 min read
TL;DR
Revenue Strength: Full-year net sales rose 18%, driven by Vita Coco Coconut Water growth of 26%.
Margin Trends: Tariffs and product costs pressured margins, but EBITDA expanded on pricing and mix.
Forward Outlook: 2026 guidance implies continued category expansion and EBITDA growth ahead of sales.
Business Overview
The Vita Coco Company operates a portfolio of “better-for-you” beverage brands led by its flagship Vita Coco coconut water franchise. The company also sells private-label coconut water products and emerging offerings such as Vita Coco Treats and protein-infused water brand PWR LIFT.
The business spans two primary geographic segments — Americas and International — with growing exposure to Europe, particularly the United Kingdom and Germany, where category adoption remains in earlier stages.
Coconut water is increasingly positioned as an active-hydration alternative to traditional sports drinks, expanding usage occasions from post-workout consumption to smoothies and cocktail mixing.
Vita Coco Earnings Performance
Revenue
Q4 net sales: $128 million (+0.4% YoY)
Full-year net sales: $610 million (+18% YoY)
Growth was driven primarily by Vita Coco Coconut Water, which grew 26% for the full year, supported by both pricing and volume expansion.
Private-label sales declined in certain regions due to retailer changes but are expected to recover with new and regained business beginning in 2026.
International markets were a major contributor, with 37% net-sales growth, led by Europe.
“For 2025, net sales increased $94 million or 18% year-over-year to $610 million, driven by strong Vita Coco coconut water net sales growth of 26%, partially offset by private label declines of 19%.” — Corey Baker, Chief Financial Officer
Margins
Gross margin (FY2025): 37% vs. 39% prior year
Q4 gross margin: 35% vs. 32%
Margin pressure came from tariffs, higher finished-goods costs, and transportation expenses, partially offset by pricing and mix improvements. Tariffs alone reduced gross margin by roughly 200 basis points in 2025.
Profitability
Reported (GAAP):
Net income (FY2025): $71 million vs. $56 million
EPS: $1.19 vs. $0.94
Non-GAAP:
Adjusted EBITDA: $98 million vs. $84 million
Adjusted EBITDA growth reflected stronger gross profit and pricing discipline despite cost pressures.
“Our very healthy full year shipment performance benefited from strong demand for Vita Coco Coconut Water, and great execution from our teams, which produced double digit adjusted EBITDA growth despite significant tariff costs.” — Martin Roper, Chief Executive Officer
Forward Guidance
For fiscal 2026, the company expects:
Net sales: $680M–$700M
Gross margin: ~38%
Adjusted EBITDA: $122M–$128M
Growth is expected to be driven by low-teens branded coconut water expansion and improving private-label trends.
Risks & Opportunities
Key variables include:
Tariff changes and commodity costs
Pricing elasticity and competitive promotional activity
FX volatility
International expansion execution
Operational Performance
Execution in 2025 was characterized by strong branded momentum and supply-chain stability. The company highlighted improved inventory positioning and distributor execution, which supported shipments late in the year.
International expansion — particularly in Europe — continues to accelerate from a small base, contributing 29% of total company net-sales growth.
Segment snapshot:
Americas branded growth remained strong
Private label declined but expected to recover
International branded business accelerated
Overall, execution appears ahead of category growth in key markets, particularly internationally.
Consumer Demand, Pricing, and Category Dynamics
Management repeatedly emphasized category health and expanding consumption occasions.
“Coconut water remains one of the fastest growing categories in the beverage aisle… growing 22% in the U.S., 32% in the U.K., and over 100% in Germany.” — Michael Kirban, Co-Founder and Executive Chairman
The company is increasingly positioning coconut water as functional hydration, competing with sports drinks through electrolyte messaging and “natural” positioning. Retail execution also improved, including expanded shelf placement at Walmart, which is already contributing measurable scan growth.
Category takeaway: Coconut water appears to be transitioning from a niche wellness beverage into a broader hydration category with global runway.
Strategic Initiatives
Key strategic priorities include:
International expansion, particularly Europe
Active-hydration positioning and sports partnerships
Innovation pipeline (Treats expansion, packaging formats)
Private-label recovery and diversification
Management believes international markets could eventually match the scale of the U.S. business.
Capital Allocation
The balance sheet remains a strategic strength:
Cash: ~$197 million
Debt: none
Share repurchases totaled $11.3 million in 2025, with $40.9 million remaining authorization.
Management continues to evaluate M&A opportunities while prioritizing brand growth and category expansion.
The Bottom Line
Vita Coco’s 2025 results reinforce three forward-looking investor themes:
First, branded coconut water growth remains the core earnings engine, supported by rising household penetration and expanding usage occasions.
Second, international expansion is becoming a meaningful contributor to growth, particularly in Europe where category adoption is still early.
Third, margin expansion in 2026 depends on tariff normalization, pricing discipline, and promotional balance, with EBITDA expected to grow faster than revenue.
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