Frozen pet food company, Freshpet, reported net sales growth, margin expansion and positive free cash flow for the fourth quarter and full year ended Dec. 31, 2025, exceeding US$1 billion in annual net sales for the first time, according to the company.
Freshpet financial results for fourth quarter 2025
Net sales increased 8.6% to US$285.2 million, compared with US$262.7 million in the prior-year period, driven by volume gains of 9.7% and partially offset by unfavorable price and mix of 1.1%.
Gross profit was US$123.5 million, or 43.3% of net sales, up from US$111.6 million, or 42.5%, in the prior year. The increase reflected reduced quality costs and improved leverage on plant expenses, partially offset by higher input costs. Adjusted gross profit was US$138.1 million, or 48.4% of net sales, compared with US$126.3 million, or 48.1%.
Selling, general and administrative expenses were US$79.0 million, or 27.7% of net sales, compared with US$92.2 million, or 35.1%, a year earlier. The decrease as a percentage of sales was primarily due to lower share-based compensation and variable compensation accrual, partially offset by increased media spending. Net income rose to US$33.8 million from US$18.1 million. Adjusted earnings before interest, taxes, depreciation and amortization totaled US$61.2 million, compared with US$52.6 million.
Full year 2025 financials for Freshpet
Net sales increased 13.0% to US$1,102.0 million, compared with US$975.2 million in 2024, driven by volume gains of 12.0% and favorable price and mix of 1.0%.
Gross profit reached US$449.6 million, or 40.8% of net sales, compared with US$396.0 million, or 40.6%, in the prior year. Adjusted gross profit was US$515.2 million, or 46.7% of net sales, compared with US$453.5 million, or 46.5%.
SG&A expenses were US$374.0 million, or 33.9% of net sales, compared with US$358.0 million, or 36.7%, in 2024. Net income increased to US$139.1 million from US$46.9 million, including a US$68.4 million income tax benefit related primarily to the release of a valuation allowance. Adjusted earnings before interest, taxes, depreciation and amortization rose to US$195.7 million from US$161.8 million. Free cash flow was US$12.4 million, compared with negative US$32.8 million in the prior year.
As of Dec. 31, 2025, the company had US$278.0 million in cash and cash equivalents and US$397.3 million in debt outstanding, net of US$5.2 million of unamortized debt issuance costs.
"Fiscal year 2025 taught us some very important lessons and challenged the resilience of our business and our organization. In the end, our team demonstrated tremendous agility – delivering growth well in excess of the dog food category, surpassing US$1 billion in net sales for the first time, expanding margins and achieving positive free cash flow," Billy Cyr, Freshpet chief executive officer, said in a press release. "Importantly, we strengthened our foundation for future growth. We retooled our marketing model to drive household penetration growth and we are building momentum in e-commerce. We also began testing island fridges – our most significant step change in retail visibility and availability – and we recently started up our first manufacturing line utilizing a breakthrough technology that we believe can enhance both product quality and profitability. We believe these efforts position us well to deliver outsized growth and improve profitability while fulfilling our mission to help dogs and cats live longer, happier and healthier lives with the people who love them."
For 2026, Freshpet expects net sales growth of 7% to 10%, adjusted earnings before interest, taxes, depreciation and amortization of US$205 million to US$215 million, and positive free cash flow with capital expenditures of approximately US$150 million.
