Freshpet reported double-digit sales growth and improved profitability in the second quarter of 2026, prompting the fresh pet food manufacturer to raise its full-year net sales and adjusted earnings before interest, taxes, depreciation and amortization outlook while increasing its long-term adjusted gross margin target.
The company reported second-quarter net sales of US$305.6 million for the period ended June 30, a 15.5% increase from US$264.7 million a year earlier. According to Freshpet, the increase was driven primarily by a 15.7% increase in volume, partially offset by unfavorable price and mix of 0.2%.
Gross profit increased to US$128.7 million, representing 42.1% of net sales, compared with 40.9% in the prior-year quarter. Freshpet attributed the improvement to lower input costs and better leverage on plant expenses, partially offset by higher quality costs associated with the startup of new technology production lines.
Adjusted gross margin improved to 48.6%, up from 46.9% a year earlier.
Net income rose to US$19.5 million from US$16.4 million in the second quarter of 2025. Freshpet said the increase reflected higher sales and an additional gain on an equity investment following post-closing adjustments related to the sale of its non-controlling interest in a privately held company, partially offset by higher selling, general and administrative expenses and income tax expense.
Adjusted earnings before interest, taxes, depreciation and amortization increased to US$52.2 million from US$44.4 million in the prior-year period.
"Our second quarter performance demonstrates the strength and resilience of our business model," said Billy Cyr, chief executive officer, in a press release. "Despite economic headwinds and new competitors, we grew significantly faster than the category, improved margins, and produced strong cash flow."
For the first six months of 2026, Freshpet generated net sales of US$603.2 million, up 14.3% from US$527.9 million in the first half of 2025. Net income climbed to US$68.0 million from US$3.7 million, while adjusted earnings before interest, taxes, depreciation and amortization increased to US$90.1 million from US$79.9 million.
The company ended the quarter with US$350.8 million in cash and cash equivalents and US$398.4 million in debt, net of unamortized debt issuance costs. Cash from operations totaled US$84.8 million during the first six months of the year, an increase of US$46.1 million compared with the same period in 2025.
Guidance raised
Freshpet increased its full-year 2026 guidance following the stronger-than-expected first half.
The company now expects:
- Net sales growth of 10% to 12%, compared with its previous guidance of 8% to 11%.
- Adjusted earnings before interest, taxes, depreciation and amortization of US$210 million to US$220 million, up from prior guidance of US$205 million to US$215 million.
- Positive free cash flow with approximately US$150 million in capital expenditures, unchanged from previous guidance.
Freshpet also raised its long-term adjusted gross margin target for 2027 to more than 49%, compared with its previous target of at least 48%. The company maintained its expectation that net sales will continue to grow well above the overall pet food category and reiterated its adjusted earnings before interest, taxes, depreciation and amortization margin target of 20% to 22%.
Recent Freshpet news
Freshpet entered the second quarter after reporting stronger-than-expected first-quarter 2026 results. In May, the company announced first-quarter net sales of US$297.6 million, up 13.1% year over year, driven primarily by volume growth. Following those results, Freshpet raised its 2026 net sales growth outlook to 8% to 11% while maintaining its adjusted earnings before interest, taxes, depreciation and amortization guidance.
Earlier coverage on Petfood Industry has also highlighted Freshpet's continued focus on expanding manufacturing capacity and improving operating efficiency as it scales production to support growth in the fresh pet food segment. The company has consistently pointed to investments in production technology, plant capacity and omnichannel distribution as key drivers of its long-term growth strategy.
