Vital Farms Inc Q1 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Rob Moskow - TD Cowen - Analyst : Alright, hopefully we'll have a little better luck here. And Russell, hi there, good morning. The price increase that you've announced, you described it as low single digit. My perception is that a lot of retailers have raised prices already on your products a lot more than that just because of category dynamics. So, did you consider raising prices more in line with what retailers have already done, and then secondly, I guess what I would hope is that if the retailers have already raised prices a lot that they won't take this as a signal to raise them even further. So, can you talk a little bit about that balance?

Question: Rob Moskow - TD Cowen - Analyst : Okay, and then it's a follow up. I mean just anecdotally, you look at the shelves today, they look a lot more full in the egg aisle than they were during the height of avian influenza. So, to what extent are you right now fully up to speed at retailers in line with the rest of the category which also appears to be back to normal.

Question: Jon Andersen - William Blair - Analyst : Good morning. Thank you for the questions. I wanted to ask about volumes both in the quarter and then kind of the full year, with the kind of low single digit volume growth in Q1 consistent with kind of your expectations, and as you progress through the year, is your expectation that the way that the kind of the egg supply kind of on boards via your new farms. And your capacity processing capacity of those eggs that the step up in growth from quarter to quarter as you move through the year is fairly uniform, or are you expecting more of an unlock, at some point during the year I am just trying to get a little bit more sense of that. And then I did want to confirm on the price increase that you said low single digit on all shell eggs. Thanks.

Question: Jon Andersen - William Blair - Analyst : Thank you so much.

Question: Matt Smith - Stifel - Analyst : Hi, good morning. Thank you for taking my question. Good morning. You reiterated the guide for the year, but can you talk about how the recently announced pricing has impacted your outlook? I mean, was the pricing contemplated in the initial outlook, or? And can you talk about the visibility you have into the phasing of egg availability? you just talked about the farms coming online, but is the timeline consistent with your previous expectation of when you sign up a farmer and when they start taking or start producing eggs off the farm?

Question: Matt Smith - Stifel - Analyst : And just one follow up on the tariff exposure, Russell, can you talk about where some of the cost pressure you're seeing is coming from? I think the butter business is fully imported, pretty clear that that would have an impact, but maybe where you're seeing the cost pressure on the egg business.

Question: Matt Smith - Stifel - Analyst : Thanks to you. I'll pass it.

Question: Ben Klieve - Lake Street Capital - Analyst : All right, thanks for taking my question. First, I'd like to ask a question on the retail distribution. It looks like in your presentation that you noted distribution increased from 24,000 stores to 26000 here. That's 24,000 number had been kind of stale for my record show like about a year and a half. And so, I am wondering if you can elaborate a bit on this distribution increase and kind of characterize the retailers that were included in that in that increase.

Question: Ben Klieve - Lake Street Capital - Analyst : Got it. Okay, fair enough. And then, last one for me and then I'll pass it on, a follow up to the tariff question, totally makes sense for all the impacts in the income statement. Can you, elaborate though on any impact you see on the expansion into Seymour? Are you, expecting your pricing to increase in a material way, for that project, or have you fully considered that in the plans that you've discussed, today?

Question: Ben Klieve - Lake Street Capital - Analyst : Very good. Okay, I appreciate the caller. Takes, take my questions. I'll get back into queue. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 08, 2025 / 12:30PM, VITL.OQ - Q1 2025 Vital Farms Inc Earnings Call

Question: Eric Des Lauriers - Craig-Hallum Capital Group - Analyst : Great, thanks for taking my questions. First ones for me are around consumer behavior. I apologize if any of this is being repeated. I think I had some audio issues when you were discussing consumer metrics, but just wondering if you've seen any changes in recent weeks to consumer behavior in the paste category as a whole or in your brand just in light of this macro uncertainty and then If you've seen any evidence of increased trial by new customers given the heightened prices for conventional eggs.

Question: Eric Des Lauriers - Craig-Hallum Capital Group - Analyst : That's very helpful. Thank you. And then this last one from me, really strong growth in the butter business, I guess, sort of on the backs of the improving brand awareness. Just wondering if you could talk a bit more about the dynamics of building the supply side of the butter business, I wondering, what leverage you have to sort of expand supply and capitalize on growing demand. Thanks.

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : So, the comment around your guidance taking into account the potential impact that global trade and economic tensions could have on consumer spending (technical difficulty).

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : Yeah, thank you. That that answered my question and just my last one here. You noted that you have exceeded 450 family farms now from 425 so I was just hoping that you could comment on how, the recruitment and onboarding process is going as you continue to scale and reach a much higher baseline of farms.

Question: Megan Alexander Clapp - Morgan Stanley - Analyst : Hi, good morning. Thanks so much. Maybe a follow up to some of the comments earlier around the price increase and the guidance, certainly don't want to put words in your mouth, but if you could just clarify it does sound like maybe. You could have raised the guide given the price increase but makes sense and is prudent to leave some cushion just given the consumer uncertainty and maybe some flexibility to go after demand in the second half would just be curious your reaction to that.

Question: Megan Alexander Clapp - Morgan Stanley - Analyst : (inaudible) The back half of last year, so we would just be curious, how did that come in relative to your expectations? Was there anything transitory we should be thinking about and related to that how should we think about the phasing of the rest of the year for gross margin?

Question: Megan Alexander Clapp - Morgan Stanley - Analyst : Okay great thank you so much.