SunOpta’s second quarter performance drew a strongly positive market reaction, reflecting management’s emphasis on operational execution, broad-based volume growth, and resilience in the face of external headwinds. CEO Brian Kocher credited the company’s 13% revenue increase to a surge in production capacity and robust demand across the product portfolio, particularly in better-for-you fruit snacks and plant-based beverages. Kocher highlighted that every go-to-market channel and top customer contributed to the growth, noting, “We are executing well and doing what we said we would do, growing revenue, growing adjusted EBITDA, improving gross margins and allocating capital with discipline.” Management also pointed out the successful implementation of tariff pass-through pricing, which helped offset cost pressures and maintain margin progress.
Is now the time to buy STKL? Find out in our full research report (it’s free).
SunOpta (STKL) Q2 CY2025 Highlights:
- Revenue: $191.5 million vs analyst estimates of $185.7 million (12.9% year-on-year growth, 3.1% beat)
- Adjusted EPS: $0.04 vs analyst estimates of $0.03 ($0.02 beat)
- Adjusted EBITDA: $22.74 million vs analyst estimates of $22.54 million (11.9% margin, 0.9% beat)
- The company lifted its revenue guidance for the full year to $810 million at the midpoint from $796.5 million, a 1.7% increase
- EBITDA guidance for the full year is $101 million at the midpoint, in line with analyst expectations
- Operating Margin: 5.5%, up from 1.2% in the same quarter last year
- Sales Volumes rose 14.4% year on year (26.9% in the same quarter last year)
- Market Capitalization: $752.8 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From SunOpta’s Q2 Earnings Call
- Andrew Strelzik (BMO) asked about the ramp and customer mix for the new fruit snacks line. CEO Brian Kocher clarified the investment is for an additional manufacturing line, mainly serving existing customers, and that current and planned capacity should cover growth into 2027.
- Strelzik (BMO) also sought clarity on gross margin progression amid tariff headwinds. Kocher explained that while tariff impacts created timing lags, pass-through pricing should restore margins fully by the fourth quarter.
- James Ronald Salera (Stephens Inc.) asked about drivers of plant-based beverage growth and competitive dynamics. Kocher stated the growth is mainly from existing customers gaining share, particularly in club and foodservice channels, and that tracked retail data does not reflect SunOpta’s broader momentum.
- Jon Robert Andersen (William Blair) inquired about managing aseptic production capacity between broth, plant-based beverages, and protein shakes. Kocher said the broth business’s seasonality allows for production optimization, while future investments will follow strict return and leverage guidelines.
- John Joseph Baumgartner (Mizuho Securities) questioned the impact of macroeconomic uncertainty on new business launches. Kocher observed that frequent, detailed engagement with customers has not signaled a slowdown, and structural tailwinds in health-oriented categories remain strong.
Catalysts in Upcoming Quarters
In the coming quarters, our analysts will watch for (1) the ramp-up and utilization of new fruit snacks manufacturing capacity, (2) ongoing gross margin improvements as tariff cost pass-throughs are fully realized, and (3) sustained growth across all major channels, especially club and foodservice. Progress in securing high-return capital projects and further broadening the customer base will also be key indicators of execution.
SunOpta currently trades at $6.25, up from $5.18 just before the earnings. Is the company at an inflection point that warrants a buy or sell? Find out in our full research report (it’s free).
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