SharkNinja, Inc. ((SN)) has held its Q1 earnings call. Read on for the main highlights of the call.
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SharkNinja’s recent earnings call painted a picture of robust growth tempered by significant challenges. The company reported strong revenue growth and continued innovation, supported by a comprehensive tariff mitigation strategy. However, it faces substantial hurdles from tariffs and pressure on gross margins. Despite these challenges, SharkNinja’s proactive approach and expanding international presence suggest a balanced outlook for the future.
Strong Revenue Growth
SharkNinja celebrated its eighth consecutive quarter of double-digit revenue growth, with net sales increasing nearly 15% year-over-year globally. This impressive performance underscores the company’s ability to sustain growth momentum in a competitive market.
Expansion and Innovation
The company is not resting on its laurels, having launched into four new subcategories in 2024. Looking ahead, SharkNinja plans to introduce at least 25 new products in 2025, including innovations like the Swirl by CREAMi and the TurboBlade fan, highlighting its commitment to innovation and market expansion.
Tariff Mitigation Strategy
In response to the challenges posed by tariffs, SharkNinja has implemented a comprehensive mitigation strategy. This includes supply chain diversification, price adjustments, and operational efficiencies, aimed at minimizing the financial impact of tariffs.
International Growth
SharkNinja’s international business showed robust growth, with a 14% year-over-year increase. Markets such as Central Europe, Chile, Colombia, and Central America were notable contributors to this expansion, reflecting the company’s successful global strategy.
Product Demand and Market Share
New products like SLUSHi and CryoGlow have captured significant consumer interest, with CryoGlow becoming a viral sensation, achieving over 1 billion impressions globally. This success underscores SharkNinja’s ability to innovate and capture market share.
Impact of Tariffs
Despite its efforts, SharkNinja continues to face considerable challenges from tariffs, which have resulted in an impact of hundreds of millions of dollars that have not been fully mitigated. This remains a significant concern for the company’s financial health.
Pressure on Gross Margin
The company’s adjusted gross margin declined by 60 basis points year-over-year, affected by tariffs and the lapping of full-price sell-in within EMEA. This pressure on margins is a critical area of focus for SharkNinja moving forward.
Decline in Adjusted EBITDA
SharkNinja reported a 13% decrease in adjusted EBITDA to $200 million, primarily due to increased investments in new product development and supply chain diversification. This decline highlights the financial impact of the company’s strategic investments.
Operational Shifts and Uncertainty
The company is navigating complex operational shifts and policy uncertainty, particularly affecting manufacturing centers. These challenges create potential revenue disruptions in North America, adding to the company’s operational complexities.
Forward-Looking Guidance
During the earnings call, SharkNinja provided an optimistic outlook for 2025, despite the challenges posed by tariffs. The company raised its full-year guidance, expecting net sales to increase between 11% and 13%, with adjusted EBITDA projected to grow between 15% and 17% year-over-year. SharkNinja emphasized its commitment to innovation and global expansion, planning significant investments in R&D and the launch of at least 25 new products in 2025.
In summary, SharkNinja’s earnings call highlighted a company balancing strong growth and innovation with significant challenges from tariffs and margin pressures. The company’s proactive strategies and international expansion efforts suggest a cautiously optimistic outlook, with a focus on mitigating risks and capitalizing on market opportunities.