Freshpet posts profitable Q1 as Millennials and high- income pet parents continue spending

American food producer Freshpet entered fiscal year (FY) 2026 on a strong note, reporting net sales of $297.6 million (€262.7M) for the first quarter (Q1), ended 31 March.

This is an increase of 13.1% year-over-year (YoY), primarily driven by volume gains of 14.6%, partially offset by unfavorable price/mix of 1.5%. According to company CEO Billy Cyr, the net sales growth exceeded the company’s guidance range for the year.

In Q1, the company’s digital orders grew 43% YoY and now represent 16.1% of total revenue, up from 14.6% in the previous quarter.

A profitable quarter

Net income reached $48.5 million (€42.8M), compared to a net loss of $12.7 million (€11.2M) in the first 3 months of 2025.

The improvement was supported by gains from the sale of its non-controlling interest in a privately held company acquired by a third party, along with higher sales and lower non- recurring selling, general and administrative (SG&A) expenses, partly offset by higher income tax expense.

Gross profit reached $120.7 million (€106.6M), while gross margin stood at 40.5%, up 1.1 percentage points (p.p.) YoY due to lower input costs and improved leverage on plant expenses.

Market share

Citing NielsenIQ data, Cyr says Freshpet increased its market share to 4.2% in the US dog food and treats category as more consumers opted for fresh and frozen products over dry and canned food.

“According to Nielsen, Freshpet was the fastest-growing brand over the 13 weeks ending March 28, 2026, demonstrating the power of our marketing model and the broad availability of Freshpet designed to meet a wide range of consumers’ buying preferences.”

High-income and Millennials

Notably, higher-income households and Millennials showed the strongest growth among club and online shoppers, as well as ultra-buyers, with no signs of trade-down.

On a 12-month basis as of 29 March, the company’s household penetration reached 16.1 million households, up 8% YoY, while the total buy rate rose approximately 6% YoY to $114 (€101).

“MVPs (Most Valuable Pet Parents), our super heavy and ultra-heavy users, are continuing to grow faster than overall households, and now total 2.5 million households, up 13% year- over-year, with an average buy rate of $513 (€453),” adds the CEO. Purchases from the MVPs account for 71% of Freshpet’s sales.

Expansion plans

Freshpet’s product portfolio is currently available in 30,435 stores across the US and Canada. Overall, the company operates more than 39,000 fridges serving as fulfillment centers.

Despite plans to add new stores, the firm sees greater opportunities in expanding its fridge network within the units it already operates to serve more omnichannel customers.

“We are shifting our commercial model by changing the media mix and message, making tactical pricing changes and evolving into an omnichannel distribution model,” says Cyr.

Technology investments

In January, Freshpet debuted a new manufacturing technology supporting its bag line in Bethlehem, Pennsylvania, followed by the installation of the first lite version of the technology on another bag line at the same site in April.

The company is also converting a bag line in Ennis, Texas, to the lite version, with completion expected by late June or early July.

“By the end of the year, we expect to have about 35% of our bag capacity using some version of the new technology,” Cyr adds.

These additional conversions would require capital spending above the company’s original CapEx guidance of $150 million (€132.4M).

Increased guidance

For the full year 2026, Freshpet updated its guidance and now expects net sales growth of 8% to 11%, up from its previous guidance of 7% to 10%.

Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) guidance remains unchanged at $205 million (€181M) to $215 million (€190M). Meanwhile, adjusted gross margin is expected to improve by 50 to 100 basis points YoY at the midpoint of the sales range.

Freshpet also anticipates higher costs in logistics, packaging and other areas due to inflation.
Capital expenditures could also increase if the company accelerates investments in new technology and its fridge network.