Freshpet Q3 2026: 50% Gross Margin and a Fourth Straight EPS Beat

Freshpet reported Q3 2026 earnings per share of $0.58, beating the $0.36 consensus estimate and extending its streak of topping EPS expectations to four consecutive quarters. Revenue of $317.84 million also came in above consensus, with volume carrying the growth.

Adjusted gross margin reached 50.0%, a level the company said it had not achieved in more than seven years. The 400 basis point gain from a year ago reflected plant expense leverage, reduced quality costs, and lower input costs, though logistics costs rose to 7.1% of sales on higher fuel and trucking rates.

CEO Billy Cyr noted that the margin gain came almost entirely from improved operating performance, with the new bag technology contributing only a limited benefit in the quarter. Management said the new bag technology is expected to deliver roughly 100 basis points of annualized adjusted gross margin improvement, with substantially all of that benefit expected to show up in 2027.

Freshpet raised its full-year 2026 net sales growth guidance to 12% to 13%, up from the prior range of 10% to 12%, and narrowed its adjusted EBITDA target to $215 million to $220 million. For 2027, the company reiterated an adjusted EBITDA margin target of 20% to 22%, though management flagged that the outcome would likely land in the lower half of that range absent improvement in inflation. Keep an eye on the stock into Q4, as management guided for a sequential step-down in adjusted gross margin tied to planned maintenance downtime and staffing ramp-up for Homestyle Creations.