BEDMINSTER, N.J. – During Wednesday morning’s earnings call, Freshpet CEO Billy Cyr said the company delivered its strongest growth rate in more than a year and its highest adjusted gross margin since the first quarter of 2020.

He said Freshpet’s performance came despite higher gas prices and weaker consumer sentiment, which have affected consumers’ willingness to trade up in pet food and other categories.

The analysts must have liked what they heard. Freshpet, which has factories in Bethlehem and Quakertown, saw its stock rise $8.25 or 13.23% by 1 p.m. The NASDAQ, where Freshpet trades, was up only 0.31% at that point showing that the company was not being carried along by a tide of market optimism but was rising on its own merit.

In a statement, Cyr commented, “Our second quarter performance demonstrates the strength and resilience of our business model. It also reinforces our belief that fresh is the future of pet food and that Freshpet is uniquely positioned to win in that segment.

“Despite economic headwinds and new competitors, we grew significantly faster than the category, improved margins, and produced strong cash flow. We believe our manufacturing scale and expertise enables us to deliver the highest quality products at the lowest costs, while our expanding omnichannel presence enables us to grow market share and deepen engagement with our most valuable pet parents.”

Second Quarter 2026

Net sales increased 15.5% to $305.6 million for the second quarter of 2026, Freshpet reported, compared to $264.7 million in the prior year period. The increase in net sales was primarily driven by volume gains of 15.7%, partially offset by unfavorable price/mix of 0.2%.

The company said gross profit was $128.7 million, or 42.1% as a percentage of net sales, for the second quarter of 2026, compared to $108.2 million, or 40.9% as a percentage of net sales, in the prior year period. It noted gross profit as a percentage of net sales increased primarily due to lower input costs and improved leverage on plant expenses, partially offset by higher quality costs related to the startup of new technology lines.

For the second quarter of 2026, adjusted gross profit was $148.4 million, or 48.6% as a percentage of net sales, compared to $124.0 million, or 46.9% as a percentage of net sales, in the prior year period.

On the cost side of the ledger, Freshpet said selling, general and administrative expenses (“SG&A”) were $107.0 million, or 35.0% as a percentage of net sales, for the second quarter of 2026, compared to $90.4 million, or 34.1% as a percentage of net sales, in the prior year period. SG&A as a percentage of net sales increased primarily due to increased logistics costs and variable compensation accrual, partially offset by decreased media spend as a percentage of net sales.

Adjusted SG&A for the second quarter was $96.1 million, or 31.4% as a percentage of net sales, compared to $79.6 million, or 30.1% as a percentage of net sales, in the prior year period.

Net income, the company reported, was $19.5 million for the second quarter of 2026 compared to $16.4 million in the prior year period. The increase in net income was due to an additional gain on equity investment, as a result of certain post-closing adjustments on the sale of 100% of the company’s non-controlling interest in a privately held company following its acquisition by a third party, and contributions from higher sales, partially offset by the increases in SG&A and income tax expense.

First Six Months of 2026

For the year to date Freshpet said net sales increased 14.3% to $603.2 million compared to $527.9 million in the prior year period. The increase in net sales was primarily driven by volume gains of 15.1%, partially offset by unfavorable price/mix of 0.8%.

Gross profit was $249.4 million, or 41.3% as a percentage of net sales, for the first six months of 2026, compared to $212.0 million, or 40.2% as a percentage of net sales, in the prior year period. Gross profit as a percentage of net sales increased primarily due to lower input costs and improved leverage on plant expenses, partially offset by higher quality costs related to the startup of new technology lines.

For the first six months of 2026, the company noted adjusted gross profit was $288.0 million, or 47.7% as a percentage of net sales, compared to $244.3 million, or 46.3% as a percentage of net sales, in the prior year period.

It also noted SG&A were $223.3 million, or 37.0% as a percentage of net sales, for the first six months, compared to $205.7 million, or 39.0% as a percentage of net sales, in the prior year period. SG&A as a percentage of net sales decreased primarily due to a decrease in non-recurring charges that occurred in the first half of 2025, partially offset by increased logistics costs and variable compensation accrual. Adjusted SG&A for the first six months of 2026 was $197.8 million, or 32.8% as a percentage of net sales, compared to $164.3 million, or 31.1% as a percentage of net sales, in the prior year period.

Net income, Freshpet reported, was $68.0 million for the first six months of 2026 compared to $3.7 million in the prior year period. It claimed the increase in net income was due to the gain on equity investment as a result of the sale of 100% of its non-controlling interest in a privately held company following its acquisition by a third party, contributions from higher sales, and decreased non-recurring SG&A charges, partially offset by increases in logistics costs, variable compensation accrual and income tax expense.

Balance Sheet

As of June 30, 2026, the company reported it had cash and cash equivalents of $350.8 million with $398.4 million of debt outstanding, net of $4.1 million of unamortized debt issuance costs. Cash and cash equivalents increased $72.8 million compared to $278.0 million as of December 31, 2025, primarily as a result of the $100.0 million of cash proceeds received from the sale of its equity investment and $27.4 million of free cash flow, partially offset by $54.4 million of share repurchases. For the six months ended June 30, 2026, cash from operations was $84.8 million, an increase of $46.1 million compared to the prior year period.

Outlook

For full year 2026, Freshpet said it is updating its guidance and now expects the following:

Net sales growth in the range of 10% to 12%, compared to growth of 8% to 11% in the previous guidance;

Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) in the range of $210 million to $220 million, compared to $205 million to $215 million in the previous guidance; and

Positive Free Cash Flow with capital expenditures of ~$150 million, unchanged from the previous guidance.

The company also updated its long-term guidance. For full year 2027, the Company now expects:

Net sales well in excess of the category growth rate, unchanged;

Adjusted gross margin of at least 49%, compared to at least 48% previously; and

Adjusted EBITDA margin in the range of 20% to 22%, unchanged.

Freshpet, Inc. is an American pet food company. Its cat food and dog food products are marketed as fresh and need to be kept refrigerated. It is listed on the Nasdaq exchange with the ticker symbol FRPT.