YETI Holdings, Inc.

Previous wording

The following discussion and analysis contains forward-looking statements within the meaning of the federal securities laws and should be read in conjunction with the disclosures we make concerning risks and other factors that may affect our business and operating results, including those described in more detail in Part I “Item 1A. Risk Factors” included in our Annual Report on Form 10-K for the year ended December 28, 2024 and subsequent Quarterly Reports on Form 10-Q filed with the SEC. The information contained in this section should also be read in conjunction with our consolidated financial statements and related notes and the information contained elsewhere in this Report. See also “Cautionary Note Regarding Forward-Looking Statements” immediately prior to Part I, Item I in this Quarterly Report on Form 10-Q.

Current wording

The following discussion and analysis contains forward-looking statements within the meaning of the federal securities laws and should be read in conjunction with the disclosures we make concerning risks and other factors that may affect our business and operating results, including those described in more detail in Part I “Item 1A. Risk Factors” included in our Annual Report on Form 10-K for the year ended January 3, 2026. The information contained in this section should also be read in conjunction with our consolidated financial statements and related notes and the information contained elsewhere in this Report. See also “Cautionary Note Regarding Forward-Looking Statements” immediately prior to Part I, Item I in this Quarterly Report on Form 10-Q.

Previous wording

We distribute our products through a balanced omni-channel platform, consisting of our wholesale and direct-to-consumer (“DTC”) channels. In our wholesale channel, we sell our products through select national and regional accounts and an assemblage of independent retail partners throughout the United States, Canada, Australia, New Zealand, Europe, and Japan, among others. We carefully evaluate and select retail partners that have an image and approach that are consistent with our premium brand and pricing. Our domestic national and regional specialty retailers include Dick’s Sporting Goods, REI, Academy Sports + Outdoors, Bass Pro Shops, Ace Hardware, Scheels, and Tractor Supply Company. We sell our products in our DTC channel to customers through our websites and YETI Authorized on the Amazon Marketplace, as well as in our retail stores. Additionally, we offer customized products with licensed marks and original artwork primarily through our DTC channel, including our corporate sales channel, on our websites, and at select retail stores. Our corporate sales program offers customized products to corporate customers for a wide-range of events and activities and in certain instances may also offer products to re-sell.

Current wording

We distribute our products through a balanced omni-channel platform, consisting of our wholesale and direct-to-consumer (“DTC”) channels. In our wholesale channel, we sell our products through select national and regional accounts and an assemblage of independent retail partners throughout the United States, Canada, Australia, New Zealand, the United Kingdom, Europe, and Japan, among others. We carefully evaluate and select retail partners that have an image and approach that are consistent with our premium brand and pricing. Our domestic national and regional specialty retailers include Dick’s Sporting Goods, REI, Academy Sports + Outdoors, Bass Pro Shops, Ace Hardware, Scheels, and Tractor Supply Company. In our international regions, our notable retailers include FGL Sports and SportChek in Canada, BCF and Rebel in Australia, and GO Outdoors in the United Kingdom. We sell our products in our DTC channel to customers through our websites and YETI Authorized on the Amazon Marketplace, as well as in our retail stores. Additionally, we offer customized products with licensed marks and original artwork primarily through our DTC channel, including our corporate sales channel, on our websites, and at select retail stores. Our corporate sales program offers customized products to corporate customers for a wide-range of events and activities and in certain instances may also offer products to re-sell.

Previous wording

During the third quarter of 2025, we expanded our Drinkware category with the launch of the Rambler Ceramic Mug Collection in two sizes and introduced a new size of the Rambler Travel Bottle. We continued the expansion of our outdoor kitchen offerings with the launch of the Rambler Food Jars in two sizes. In our Coolers & Equipment category, we expanded our bags offerings with the introduction of a new size of the Cayo backpack. We also introduced new seasonal colorways across our Drinkware and Coolers & Equipment categories.

Current wording

During the first quarter of 2026, within our Drinkware category, we expanded our bottles and mugs offerings with the launch of a new size of the Rambler Travel Bottle and the introduction of the redesigned Straw Mug 2.0 in two sizes. We continued to broaden our coffeeware and barware offerings with the launch of the Rambler Ceramic Stackable Lowball and the Rambler Ceramic Wine Tumbler. In our Coolers & Equipment category, we expanded our pursuit bags offerings with the introduction of the Skala Collection of Hiking Packs in eight sizes. Within our soft cooler bags offerings, we further expanded the Daytrip Collection with the launch of the Insulated Snack Box in two sizes and the Insulated Box. We also introduced new seasonal colorways across our Drinkware and Coolers & Equipment categories.

Previous wording

Our business is exposed to and impacted by macroeconomic factors, including but not limited to uncertainty surrounding inflationary pressures, consumer confidence and purchasing behaviors, foreign currency exchange rate fluctuations, geopolitical conflicts, and government actions and policies, including changes in interest rates, tax rates, and tariff rates. We have experienced a challenging macroeconomic and consumer spending environment through the third quarter of 2025 and expect such challenges to continue through the remainder of 2025.

Current wording

Our business is exposed to and impacted by macroeconomic factors, including but not limited to uncertainty surrounding inflationary pressures, consumer confidence and purchasing behaviors, foreign currency exchange rate fluctuations, geopolitical conflicts, and government actions and policies, including changes in interest rates, tax rates, and tariff rates. The impact of such conditions on our business and results of operations for 2026 remains uncertain. Such uncertainties are exacerbated by the ongoing conflict in the Middle East. Although we have not experienced material impacts to date, the ultimate future impact of such geopolitical conflict on factors such as freight rates, raw materials costs, and consumer spending are unknown.

Previous wording

Fiscal Year. We have a 52- or 53-week fiscal year that ends on the Saturday closest in proximity to December 31, such that each quarterly period will be 13 weeks in length, except during a 53-week year when the fourth quarter will be 14 weeks. Our fiscal year ending January 3, 2026 (“2025”) is a 53-week period. The first quarter of our fiscal year 2025 ended on March 29, 2025, the second quarter ended on June 28, 2025, and the third quarter ended on September 27, 2025. Our fiscal year ended December 28, 2024 (“2024”) was a 52-week period. Unless otherwise stated, references to particular years, quarters, months and periods refer to our fiscal years and the associated quarters, months, and periods of those fiscal years. The unaudited condensed consolidated financial results presented herein represent the three and nine months ended September 27, 2025 and September 28, 2024.

Current wording

Fiscal Year. We have a 52- or 53-week fiscal year that ends on the Saturday closest in proximity to December 31, such that each quarterly period will be 13 weeks in length, except during a 53-week year when the fourth quarter will be 14 weeks. Our fiscal year ending January 2, 2027 (“2026”) is a 52-week period. The first quarter of our fiscal year 2026 ended on April 4, 2026, the second quarter ends on July 4, 2026, and the third quarter ends on October 3, 2026. Our fiscal year ended January 3, 2026 (“2025”) was a 53-week period. Unless otherwise stated, references to particular years, quarters, months and periods refer to our fiscal years and the associated quarters, months, and periods of those fiscal years. The unaudited condensed consolidated financial results presented herein represent the three months ended April 4, 2026 and March 29, 2025.

Previous wording

•Coolers & Equipment net sales increased by $37.7 million, or 7%, to $556.2 million, compared to $518.4 million in the same period last year, primarily driven by strong performance in bags, soft coolers, and hard coolers.

Current wording

•Coolers & Equipment net sales increased by $15.9 million, or 11%, to $156.1 million, compared to $140.2 million in the same period last year, primarily driven by strong performance in soft coolers, bags, hard coolers, and cargo, reflecting continued strength across core and expanded categories.

Previous wording

Gross profit decreased $5.2 million, or 2%, to $272.5 million, compared to $277.7 million in the prior year quarter. Gross margin rate decreased 210 basis points to 55.9% from 58.0% in the prior year quarter, primarily due to the following factors:

Current wording

Gross profit increased $8.5 million, or 4%, to $210.2 million, compared to $201.7 million in the prior year quarter. Gross margin rate decreased 210 basis points to 55.3% from 57.4% in the prior year quarter, primarily due to the following factors:

Previous wording

•higher tariff costs, which unfavorably impacted gross margin by 190 basis points;

Current wording

•higher tariff costs, which unfavorably impacted gross margin by 280 basis points;

Previous wording

•a decrease in the mix of Drinkware net sales, which unfavorably impacted gross margin by 60 basis points; and

Current wording

•a decrease in the mix of our DTC channel net sales and Drinkware net sales, which unfavorably impacted gross margin by 70 basis points; and

Previous wording

•the unfavorable impact of foreign currency exchange rates, which unfavorably impacted gross margin by 10 basis points.

Current wording

•favorable foreign currency exchange rates, which favorably impacted gross margin by 80 basis points;

Previous wording

•the impact of selective price increases on certain drinkware products implemented during the second quarter of 2025, which favorably impacted gross margin by 50 basis points;

Current wording

•the impact of selective price increases on certain products implemented during the second quarter of 2025 and the first quarter of 2026, which favorably impacted gross margin by 30 basis points; and

Previous wording

SG&A expenses increased $10.1 million, or 5%, to $218.2 million for the three months ended September 27, 2025, compared to $208.1 million for the three months ended September 28, 2024. As a percentage of net sales, SG&A expenses increased 120 basis points to 44.7% from 43.5% in the prior year quarter. The increase in SG&A expenses was primarily driven by:

Current wording

SG&A expenses increased $17.7 million, or 10%, to $197.8 million for the three months ended April 4, 2026, compared to $180.1 million for the three months ended March 29, 2025. As a percentage of net sales, SG&A expenses increased 70 basis points to 52.0% from 51.3% in the prior year quarter. The increase in SG&A expenses was primarily driven by:

Previous wording

•an increase in general and administrative expenses of $6.2 million (increasing SG&A as a percent of sales by 110 basis points) mainly due to growth investments in technology and facilities as well as asset impairments in the current year quarter;

Current wording

•an increase in general and administrative expenses of $5.8 million (increasing SG&A as a percent of sales by 90 basis points) mainly due to growth investments in technology and facilities, higher professional fees, as well as asset impairments in the current year quarter;

Previous wording

•an increase in distribution and fulfillment expenses of $0.9 million (decreasing SG&A as a percent of sales by 10 basis points) primarily due to higher third-party logistics fees and higher online marketplace fees associated with higher Amazon Marketplace net sales, partially offset by lower outbound freight expenses.

Current wording

•an increase in distribution and fulfillment expenses of $4.7 million (decreasing SG&A as a percent of sales by 10 basis points) primarily due to higher third-party logistics fees, outbound freight, and online marketplace fees;

Previous wording

•an increase in employee compensation and benefits expenses of $3.1 million (increasing SG&A as a percent of sales by 40 basis points) primarily due to an increase in non-cash stock-based compensation expense;

Current wording

•an increase in employee compensation and benefits expenses of $3.6 million (decreasing SG&A as a percent of sales by 20 basis points), including investments in headcount to support our international expansion, partially offset by lower non-cash stock-based compensation expense;

Previous wording

•a decrease in marketing and advertising expenses of $2.3 million (decreasing SG&A as a percent of sales by 20 basis points).

Current wording

•an increase in marketing and advertising expenses of $2.7 million (increasing SG&A as a percent of sales by 10 basis points); and

Previous wording

•an increase in depreciation and amortization expense of $3.6 million (increasing SG&A as a percent of sales by 30 basis points) primarily related to our continued capital investments.

Current wording

•an increase in depreciation and amortization expense of $0.8 million (no impact on SG&A as a percent of sales).

Previous wording

Interest expense, net was $0.1 million for the three months ended September 27, 2025. Interest income, net was $0.4 million for the three months ended September 28, 2024. The change versus the prior year quarter was primarily due to a decrease in interest income.

Current wording

Interest expense, net was $1.1 million for the three months ended April 4, 2026. Interest income, net was $0.3 million for the three months ended March 29, 2025. The change versus the prior year quarter was primarily due to a decrease in interest income.

Previous wording

Other income was $6.0 million for the nine months ended September 27, 2025, compared to other income of $0.4 million for the nine months ended September 28, 2024. The change versus the prior year period was primarily due to higher foreign currency gains on intercompany balances.

Current wording

Other income was $1.0 million for the three months ended April 4, 2026, compared to $1.4 million for the three months ended March 29, 2025. The change versus the prior year quarter was primarily due to lower foreign currency gains on intercompany balances.

Previous wording

Income tax expense was $13.7 million for the three months ended September 27, 2025, compared to $17.8 million for the three months ended September 28, 2024. The decrease in income tax expense was primarily due to lower income before income taxes. The effective tax rate was 26% for the three months ended September 27, 2025, compared to 24% for the three months ended September 28, 2024. The effective tax rate for the three months ended September 27, 2025 was unfavorably impacted by lower income before taxes and increased primarily due to the non-deductible portion of executive compensation and a lower tax benefit from our foreign-derived intangible income deduction.

Current wording

Income tax expense was $2.4 million for the three months ended April 4, 2026, compared to $6.7 million for the three months ended March 29, 2025. The decrease in income tax expense was primarily due to lower income before income taxes. The effective tax rate was 19.9% for the three months ended April 4, 2026, compared to 28.9% for the three months ended March 29, 2025. The lower effective tax rate was primarily due to the impact of a discrete tax benefit related to stock-based compensation in the three months ended April 4, 2026.

Previous wording

Our cash requirements have principally been for working capital purposes, long-term debt repayments, and capital expenditures. We fund our working capital and our capital investments from cash flows from operating activities, cash on hand, and borrowings available under our revolving credit facility (the “Revolving Credit Facility”). Pursuant to our Share Repurchase Program described below, we may also use cash to repurchase shares of our common stock. We believe that our current operating performance, operating plan, strong cash position, and borrowings available under our Revolving Credit Facility, will be sufficient to satisfy our liquidity needs and cash requirements for at least the next twelve months and foreseeable future.

Current wording

Our cash requirements have principally been for working capital purposes, long-term debt repayments, and capital expenditures. Our plans for cash may periodically include repurchasing shares of our common stock pursuant to our Share Repurchase Program described below. We fund our working capital, capital investments, and other cash needs from cash flows from operating activities, cash on hand, or borrowings available under our revolving credit facility (the “Revolving Credit Facility”). We believe that our current operating performance, operating plan, strong cash position, and borrowings available under our Revolving Credit Facility will be sufficient to satisfy our liquidity needs, cash requirements, and plans for cash for at least the next twelve months and foreseeable future.

Previous wording

As of September 27, 2025, we had a cash balance of $164.5 million, working capital (excluding cash) of $210.2 million, and $300.0 million of borrowings available under the Revolving Credit Facility.

Current wording

As of April 4, 2026, we had a cash balance of $127.8 million, working capital (excluding cash) of $208.9 million, and $300.0 million of borrowings available under the Revolving Credit Facility.

Previous wording

At September 27, 2025, we had $74.9 million principal amount of indebtedness outstanding under the Term Loan A under the Credit Facility and no outstanding borrowings under the Revolving Credit Facility. The weighted-average interest rate for borrowings under the Term Loan A was 6.15% during the three months ended September 27, 2025.

Current wording

At April 4, 2026, we had $72.8 million principal amount of indebtedness outstanding under the Term Loan A under the Credit Facility and no outstanding borrowings under the Revolving Credit Facility. The weighted-average interest rate for borrowings under the Term Loan A was 5.55% during the three months ended April 4, 2026.

Previous wording

During the first quarter of 2025, our Board of Directors approved a $350.0 million increase to the Share Repurchase Program authorization, for a total of $450.0 million available under the Share Repurchase Program. Repurchases under the Share Repurchase Program may be made from time to time at prevailing prices in the open market, through various methods, including, but not limited to, open market, privately negotiated, or accelerated share repurchase transactions. Repurchases under the Share Repurchase Program may also be made pursuant to a plan adopted under Rule 10b5-1 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The timing, manner, price, and actual amount of share repurchases will be determined by management based on various factors, including, but not limited to, stock price, economic and market conditions, other capital allocation needs and opportunities, and corporate and regulatory considerations. YETI has no obligation to repurchase any amount of our common stock, and such repurchases may be suspended or discontinued at any time.

Current wording

In 2024, our Board of Directors authorized the repurchase of up to $300.0 million of YETI’s common stock (the “Share Repurchase Program”), excluding fees, commissions, and excise tax due under the Inflation Reduction Act of 2022. Repurchases under the Share Repurchase Program may be made from time to time at prevailing prices in the open market, through various methods, including, but not limited to, open market, privately negotiated, or accelerated share repurchase transactions. Repurchases under the Share Repurchase Program may also be made pursuant to a plan adopted under Rule 10b5-1 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The timing, manner, price, and actual amount of share repurchases will be determined by management based on various factors, including, but not limited to, stock price, economic and market conditions, other capital allocation needs and opportunities, and corporate and regulatory considerations. YETI has no obligation to repurchase any amount of our common stock, and such repurchases may be suspended or discontinued at any time. All shares repurchased under the Share Repurchase Program are held as treasury stock.

Previous wording

Cash flows related to operating activities are dependent on net income, non-cash adjustments to net income, and changes in working capital. The increase in cash provided by operating activities during the nine months ended September 27, 2025 compared to cash provided by operating activities during the nine months ended September 28, 2024 is primarily due to a decrease in cash used in working capital driven by a decrease in cash used in the changes of accounts payable and accrued expenses and accounts receivable balances.

Current wording

Cash flows related to operating activities are dependent on net income, non-cash adjustments to net income, and changes in working capital. The decrease in cash used in operating activities during the three months ended April 4, 2026 compared to cash used in operating activities during the three months ended March 29, 2025 is primarily due to a favorable impact from changes in working capital, partially offset by a decrease in net income, excluding non-cash expenses.

Previous wording

The decrease in cash used in investing activities during the nine months ended September 27, 2025 was primarily due to lower purchases of property and equipment, and lower cash paid for acquisitions in the current year period.

Current wording

The decrease in cash used in investing activities during the three months ended April 4, 2026 was primarily due to lower purchases of intangible assets, partially offset by higher purchases of property and equipment.

Previous wording

The increase in cash used by financing activities during the nine months ended September 27, 2025 was primarily due to higher repurchases of common stock compared to the prior year period.

Current wording

The increase in cash used in financing activities during the three months ended April 4, 2026 was primarily due to higher taxes paid for the net share settlement of stock-based awards.

Previous wording

Our unaudited condensed consolidated financial statements are prepared in accordance with GAAP. The preparation of these unaudited condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures. We evaluate our estimates and assumptions on an ongoing basis. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Actual results could differ materially from those estimates. A discussion of the accounting policies that management considers critical in that they involve significant management judgments and assumptions require estimates about matters that are inherently uncertain and because they are important for understanding and evaluating our reported financial results is included in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 28, 2024 filed with the SEC.

Current wording

Our unaudited condensed consolidated financial statements are prepared in accordance with GAAP. The preparation of these unaudited condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures. We evaluate our estimates and assumptions on an ongoing basis. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Actual results could differ materially from those estimates. A discussion of the accounting policies that management considers critical in that they involve significant management judgments and assumptions require estimates about matters that are inherently uncertain and because they are important for understanding and evaluating our reported financial results is included in Part II, Item 7 of our Annual Report on Form 10-K for the year ended January 3, 2026 filed with the SEC. There have been no significant changes to these critical accounting policies.