Transcripts
Vital Farms, Inc.'s management answers for the business every quarter. These are the exchanges that explain it best — verbatim, from the call transcripts preserved in Sources. Each link opens the full transcript at that page in a new tab.
First Quarter 2026 Earnings Call — Q1 FY2026
The thesis stress-test: management resets 2026 guidance after price gaps to premium rivals widened, and lays out how the eggs-first model absorbs an oversupply shock. · Open the full transcript →
Loyalty held, but new-household trial fell as price gaps widened — the core of the reset.
Russell Diez-Canseco (Executive Chairperson, President & CEO): It's important to note that despite these price gaps, our existing base of consumers have remained loyal. However, the rate at which new households are trying us for the first time dropped significantly. In 2024 and 2025, more than 55% of our consumers were households that had not bought us previously. That dropped to just 50% in the first quarter of 2026. This demonstrates our reduced ability to convert growing brand awareness into trial at these price gap levels. In contrast, our consumer data also shows that our existing consumers continue to be loyal and have generally resisted trading down to lower priced alternatives. Buy rates are holding up very well with units per retained household 2% higher in the first quarter than the average for the prior 8 quarters.
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The fix, quantified: cutting one top-10 customer's gap from 35% to 25% lifted volume 18% in two weeks.
Russell Diez-Canseco (Executive Chairperson, President & CEO): Our data shows that in geographies where price gaps to outdoor access competitors have widened the most, volume growth is negative. And where price gaps have remained more moderate, we continue to see healthy growth without needing to race to the bottom on promotions. That means we need to narrow these price gaps in the marketplace in a targeted way, geography by geography and retailer by retailer. That work is underway, and we believe initial efforts show positive results. For example, we recently addressed price gaps at a top 10 customer, bringing them from about 35% above a group of competing premium branded outdoor access eggs to about 25% and volumes increased by 18% after just 2 weeks compared to the prior 4 weeks.
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Why buying every farmer's eggs creates a costly overhang — and how contract amendments unwind it.
Russell Diez-Canseco (Executive Chairperson, President & CEO): A big impact on our short-term margins is the cost of oversupply relative to our current rate of retail sales. Because we buy eggs from our farmer partners regardless of the retail sales environment, temporary imbalances between supply and demand can create a costly supply overhang. In the short run, this results in expanded inventories and then increased low revenue sales to the breaker channel. Since we expect the supply-demand mismatch to persist over the coming months, we're working with some of our farmer partners to manage supply through voluntary amendments to their contracts to cease production from existing blocks or delay placement of future blocks. In return, we make payments to the farmers to compensate them for the foregone profits, but that still represents meaningful savings versus the full cost of buying eggs we don't need.
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Exiting butter to free $25M of cash and ~150–200 bps of gross margin, refocusing capital on eggs.
Russell Diez-Canseco (Executive Chairperson, President & CEO): Fifth, we are exiting butter. We have made the decision to exit our butter business, ending shipments toward the end of the year. We expect that this will free up $25 million in cash this year, reduce sales by an estimated $14 million in 2026 and improve gross margin by 150 to 200 basis points starting in 2027. This was not an easy decision, but we believe it's the right one, both for its near-term impact on our economics and because it refocuses human and financial capital to pursue more productive growth opportunities.
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The hard question — is the margin target still real if this is the new normal? Not banking on price recovery.
Matthew Smith (Analyst, Stifel); Russell Diez-Canseco (Executive Chairperson, President & CEO): Russell, you called this reset, a reset of the year, not the ambition. The industry is recovering from a multiyear impact of avian influenza. And as you look at the competitive dynamic today, is this the new normal? And if that's so, is the long-term margin target, is that still relevant for Vital today? You talked about exiting this year at near 35% gross margin and double-digit EBITDA, but there's still some action in the background that could be a longer-term drag on the margin structure from pausing farmer contracts and incurring higher costs down the road. I guess what's the confidence in getting back to that double-digit EBITDA margin even if today's environment becomes the new normal? […] As we said in the prepared remarks, we are not assuming or waiting for a pricing recovery in the broader market to support our recovery in gross and EBITDA margins as we head into 2027. We are focused on making sure that we deliver the right economics even at these distressed prices in the market, although historically, they have not been enduring.
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The category thesis, tested: the UK runs >75% outdoor-access; US adoption is accelerating even in a glut.
Glenn West (Analyst, William Blair); Russell Diez-Canseco (Executive Chairperson, President & CEO): This is Glenn West on for Jon Andersen this morning. Russell, you kind of noted some category metrics just on the outdoor access category. It's grown to 50% volume share, I think you said, and up 32% year-over-year. I guess I just wanted to ask: maybe you could help lay out the category. Is it like private label that's driving a lot of those share gains, or more competition from new insurgent smaller players? Or how is Vital sitting there in terms of share as well? […] I'd start by saying that we have seen for more than a decade that countries like the U.K. that are much further ahead in general awareness of food choices and food production systems are well above a majority of eggs being produced from outdoor access flocks. I believe the U.K. is well over 75%, in fact. And so one of the questions we've gotten over the years is, well, how high is that for the U.S. And I think part of what underlies that question is what's the willingness of consumers broadly across the economy to pay up for a better egg in their estimation. And we're seeing growth both in branded and private label. But most importantly, I think against an increasingly challenged macro backdrop, we're actually seeing an acceleration of adoption of outdoor access eggs on a volume share basis. And that shows up in the accompanying exhibits. And so from that perspective, I think the thesis that there's a real opportunity, an enduring opportunity in premium outdoor access eggs is as strong as it ever was. And we're seeing room for brands and for private label and for us in that group.
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Fourth Quarter & Full Year 2025 Earnings Call — Q4 FY2025
The victory lap and the handoff — a record year over $100M EBITDA, the founder's retirement, and the $2B/2030 targets — right before the 2026 reset. · Open the full transcript →
Founder Matt O'Hayer retires after nearly 20 years; Russell adds executive chair to the CEO role.
Russell Diez-Canseco (Executive Chairperson & CEO): After nearly 20 years of visionary leadership, our founder, Matt O'Hayer, has decided to retire as executive chairperson and as a member of our board of directors. Matt founded Vital Farms, Inc. in 2007 with just 20 hens. […] Effective February 24th, the board appointed me to serve as Executive Chairperson and CEO. This unified leadership structure is the most effective way to maintain our strong momentum, drive our 2026 strategic initiatives, and continue progressing toward the targets we set at the Investor Day in December.
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The supply moat: a 600-farm pasture-raised network, up roughly 175 farms in a single year.
Russell Diez-Canseco (Executive Chairperson & CEO): our farm network expanded to more than 600 small farms committed to our pasture-raised standards, where hens roam freely on open pastures with year-round outdoor access. Adding approximately 175 farms in a single year is a testament to the trust we've built in the agricultural community around our unwavering commitment to humane animal care. Farmers want to be a part of what we're building because we offer a path to a sustainable livelihood while being stewards of the land and champions of animal welfare.
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The reaffirmed frame: $2B revenue by 2030 at 15–17% EBITDA margin, with 16M households as runway.
Russell Diez-Canseco (Executive Chairperson & CEO): At our Investor Day in December, we shared our updated long-term target of $2 billion in net revenue by 2030, with Adjusted EBITDA margin between 15% and 17%. These goals are grounded in the operational capabilities we're building and the market opportunity we see ahead of us. Our brand still represents only a fraction of the total shell egg market, giving us substantial runway for growth. We serve nearly 16 million households through approximately 24,000 retail locations, but there's so much more opportunity ahead.
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Pressed on whether the ~20% CAGR to 2030 leaves room for any slowdown; the sources-of-confidence answer.
Brian Holland (Analyst, D.A. Davidson); Russell Diez-Canseco (Executive Chairperson & CEO): kind of playing this forward, outlook this year, I think is, you know, low 20% range on the top line. That's an algorithm that you would have to hold from here through 2030, I think, to hit that $2 billion of revenue, if I'm not mistaken. The thought coming into this year was, you know, you'd be lapping capacity constraints in 1Q and a little less so in 2Q. 4Q, you would then have the ERP disruption. You know, quote-unquote, 'easier compares.' Now, we've obviously introduced some volatility, as you referenced, whether that's weather or some other things in the category. How do we think about the level of confidence, the sources of confidence behind maintaining this level of growth, which really demands almost no deceleration from here through 2030? What are the sources of confidence behind that? […] Again, the consumer value proposition is still very much there. You know, I start with all the work we did last year to make sure that we took supply chain constraint off the table in terms of being a constraint to our continued growth. We've got the capacity at ECS. We've got our third line, which gives us the opportunity to lean in both to capacity expansion and efficiency because we can allocate space to the various lines more efficiently. We're gaining volume share, and that's the thing I would point to as a continued proof point that what we're doing is working. As we head into 2026, the setup is we've got a massive gain in awareness, which is the leading indicator for us of trial and ultimately to loyalty. That's there in spades. We're very judiciously, as always, using our marketing and commercial resources to convert that awareness into trial. The capacity's there, the brand awareness is there, the consumer sentiment is there, and it's a question of, I think, operating and executing at a very high level. The thing is, we're built for this environment. We are, I believe we've got the best team in the business, the best brand in the business, the best supply chain in the business, and this is a year in which our ability to execute at a high level will continue to drive our growth.
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First buyback since the IPO — deploying dry powder as a sign the company is maturing.
Thilo Wrede (CFO): This is the first buyback program that the board has authorized since the IPO. I would say there are two factors at play here. One is, look, we're listening to shareholders. We're listening to the buy side, the sell side. We've gotten a lot of questions over the last 12 months in particular about how we use our balance sheet. We have this unused debt capacity. As you know, we are debt-free. We have over $100 million in cash. We are investing this cash in building out the Seymour facility this year. That still leaves a lot of balance sheet potential there that we've been holding as dry powder. Now is a good time for us to think about what can we do with that dry powder to create shareholder value. That is where this decision to create the share repurchase authorization, so that when there is an opportunity in the market to buy back our stock at attractive levels, that we're able to step into that. That is really the reason behind it. It's I would look at it as a sign that we're maturing as a company a bit. We're doing the things that we think are the right things for creating long term shareholder value. It's a sign that, you know, we're listening to the shareholder conversations that we're having.
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Fourth Quarter & Full Year 2023 Earnings Call — Q4 FY2023
The clearest ground-up explanation of the model: the family-farm network, Egg Central Station, and the path to $1 billion by 2027. · Open the full transcript →
How it makes money: 300+ family farms plus Egg Central Station, resilient through avian influenza.
Russell Diez-Canseco (President & CEO): Our resilient supply chain, with over 300 family farms and our world-class washing and packing facility at Egg Central Station, are big reasons why we are able to continually meet growing customer demand. Our supply chain model and our ability to execute has also enabled us to successfully navigate potential disruptions like avian influenza without significantly impacting our commitments to customers and consumers. We believe our strong close to 2023 sets us up for another important year on our progress to being a $1 billion company by 2027.
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Farmer unit economics: absorbing barn-construction and interest costs so growers keep winning.
Adam Samuelson (Analyst, Goldman Sachs); Russell Diez-Canseco (President & CEO): Can you just elaborate a little bit on how the contract rates may have stepped up and what the implications of that are for cash and rent margins? […] As you know, we’ve always considered a steady pipeline of the right farmers to be critical to our long-term growth strategy and that hasn’t changed. We continue to enjoy strong relationships with excellent farmers and to continue to attract the right number of prospects as we continue to grow. But the reality is that if we look at the experience of our farmers over the last few years, they haven’t been immune to the inflationary forces that have affected so many other parts of the supply chain. The one piece that we’ve observed having more of a lingering effect is related to construction costs.
So, we continue to see elevated construction costs for new barn builds for new farmers, in part driven by cost of construction and in part driven by continued elevated interest rates on the loan that they take to do that construction.
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Butter's ceiling foreshadowed: hard to find farms meeting standards — the seed of the 2026 exit.
Russell Diez-Canseco (President & CEO): started that butter business years ago with aspirations to grow it to $20 million at the time, that was about the size of the egg business. As we have expanded that butter business beyond $20 million, what we found is that it is increasingly hard to find the right farms that meet our very high standards. And so that has affected our ability to grow that business. The demand is there, but we’re unwilling to procure butter and work with co-packers that we don’t love.
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More calls
Third Quarter 2025 Earnings Call — Q3 FY2025 · 10 pages · The last quarterly call before the December 2025 Investor Day that set the $2 billion-by-2030 target — management's read on the shift from supply-constrained to unconstrained capacity. · Open →
Second Quarter 2025 Earnings Call — Q2 FY2025 · 12 pages · Mid-2025, with commodity eggs still dear after avian influenza — the mirror image of the 2026 glut, and how management defended premium positioning over chasing volume. · Open →
First Quarter 2025 Earnings Call — Q1 FY2025 · 12 pages · The prior-year quarter (16.9% adjusted EBITDA margin) that the 2026 reset is measured against — the cycle's high-water mark for margins. · Open →
Fourth Quarter & Full Year 2024 Earnings Call — Q4 FY2024 · 11 pages · The 2024 wrap-up and 2025 setup — bringing a third ECS production line and a new ERP system online, and the pivot toward unconstrained supply. · Open →
First Quarter 2024 Earnings Call — Q1 FY2024 · 11 pages · An early execution call on the $1 billion-by-2027 plan — distribution and SKU-expansion mechanics, with Chief Sales Officer Peter Pappas on the line. · Open →
Fourth Quarter & Full Year 2021 Earnings Call — Q4 FY2021 · 34 pages · The first full-year call as a public company — the family-farm network, Egg Central Station's expansion toward $600M of capacity, and the premium-pricing rationale from the ground up. · Open →