Vita Coco’s third quarter was marked by significant sales growth and a positive market reaction, as management credited strong consumer demand and effective execution in both the U.S. and international markets for the results. CEO Martin Roper highlighted the impact of improved inventory levels and two price increases in the U.S., explaining that these actions enabled the company to meet rising demand while navigating cost pressures. Management also pointed to the acceleration of the coconut water category in key regions, with Executive Chairman Michael Kirban noting, “coconut water remains one of the fastest-growing categories in the beverage aisle, growing 22% year-to-date in the U.S. and 32% in the U.K.”
Is now the time to buy COCO? Find out in our full research report (it’s free for active Edge members).
Vita Coco (COCO) Q3 CY2025 Highlights:
- Revenue: $182.3 million vs analyst estimates of $158.3 million (37.2% year-on-year growth, 15.2% beat)
- Adjusted EPS: $0.40 vs analyst estimates of $0.31 (29.1% beat)
- Adjusted EBITDA: $32.39 million vs analyst estimates of $24.28 million (17.8% margin, 33.4% beat)
- EBITDA guidance for the full year is $92.5 million at the midpoint, above analyst estimates of $90.38 million
- Operating Margin: 15.3%, in line with the same quarter last year
- Sales Volumes rose 28.8% year on year (-3.1% in the same quarter last year)
- Market Capitalization: $2.27 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Vita Coco’s Q3 Earnings Call
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Bonnie Herzog (Goldman Sachs) asked about the implied sequential sales decline in Q4 and whether shipment pull-forwards or inventory changes explained the guidance. CEO Michael Kirban and CEO Martin Roper emphasized focusing on full-year growth and noted healthy distributor inventories to support the Walmart reset.
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Christopher Carey (Wells Fargo Securities) questioned the concentration and timing of tariff impacts, especially from Brazil, and how soon further pricing might be needed. CFO Corey Baker clarified that most Brazil tariff effects would appear in Q4, with management monitoring the situation before making pricing decisions in early 2026.
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Robert Ottenstein (Evercore ISI) asked about differences between U.S. and European markets, competitive intensity, and margin profiles. CEO Martin Roper explained that Europe, particularly the U.K., is less competitive, with strong brand share and direct-to-retail distribution supporting healthy, if slightly lower, margins than in the U.S.
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Michael Lavery (Piper Sandler) inquired about capital allocation priorities and the role of M&A. CEO Martin Roper reiterated that excess cash will first support core business growth, with M&A considered only if it creates clear shareholder value, and buybacks as a last priority.
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Eric Serotta (Morgan Stanley) asked about competitive pricing responses and the sustainability of Treats’ growth. CEO Michael Kirban said competitors have taken varying pricing actions, and management is monitoring the impact before further price changes. Roper added that Treats is attracting new customers and should see additional distribution gains next year.
Catalysts in Upcoming Quarters
In the coming quarters, StockStory analysts will be monitoring (1) the pace and effectiveness of Vita Coco’s tariff mitigation strategies, including sourcing diversification and potential trade relief; (2) the execution and impact of expanded distribution, especially the Walmart set reset; and (3) sustained international growth, particularly in Europe as brand-building investments continue. Additional focus will be on the performance of new product launches and the balance between volume growth and pricing power.
Vita Coco currently trades at $39.62, down from $42.29 just before the earnings. Is there an opportunity in the stock?Find out in our full research report (it’s free for active Edge members).
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