NASDAQ$KRT
Karat Packaging Inc · Q2 2023 earnings
Q2 2023 earnings · · Investor relations
Briefing
Karat Packaging experienced strong margin expansion, despite a decrease in net sales due to price reductions and lower logistics revenue, while core product sales and eco-friendly product demand remained solid.
Karat Packaging reported a decrease in net sales by 5.3% to $108.7 million, but experienced a significant increase in gross profit by 23.3% to $41.9 million and net income by 48.3% to $10.7 million. The company's gross margin improved to 38.5%, and adjusted EBITDA increased by 78.6% to $21.1 million.
- Net sales decreased by 5.3% year-over-year to $108.7 million.
- Gross profit increased by 23.3% year-over-year to $41.9 million.
- Gross margin improved to 38.5% compared to 29.6% in the prior-year quarter.
- Net income increased by 48.3% year-over-year to $10.7 million.
Headline financials
Revenue & EPS history
Karat Packaging · Revenue · Quarterly
$109M
Revenue by segment
Karat Packaging · $84.9M total across 3 segments · Q2 2023
- Chains and distributors$62.6M-5.7%73.7%
- Online$15.5M+0.0%18.2%
- Retail$6.83M-13.7%8.0%
Forward guidance
The company expects net sales to decrease 3-4% in Q3 2023, increase 10-15% in Q4 2023, and decrease by low single digits for the full year 2023. The gross margin goal for the full year is 36-37%, and eco-friendly product sales are targeted to be 35% of total sales.
Tailwinds
- Net sales for the 2023 fourth quarter expected to increase 10 to 15 percent over the prior year period.
- Gross margin goal for the 2023 full year: 36 to 37 percent versus 31.2 percent for 2022.
- Eco-friendly product sales objective for the 2023 full year: 35 percent of total sales, compared with 27 in 2022.
Headwinds
- Net sales for the 2023 third quarter expected to decrease 3 to 4 percentage, compared with prior-year period, primarily due to implementation delays by new chain accounts and in opening new warehouses, and lower revenue from logistics services and shipping fees.
- Net sales for the 2023 full year expected to decrease by low single digits.
Historical earnings impact
How earnings announcements have historically affected this stock's price.
Avg. return before/after earnings
Based on 20 quarterly earnings reports · overlaid with Q2 2023
-0.7%
Avg return
Earnings day
+1.2%
Avg return
5 days after
+0.8%
Avg return
30 days after
42%
10 / 24 earnings
Positive
+20.7%
Q4 2025
Best reaction
-18.6%
Q3 2023
Worst reaction
| Quarter | Report date | Reaction (Day 0) | +5 days | +30 days |
|---|---|---|---|---|
| Q1 2026 | -7.5% | -10.4% | -6.3% | |
| Q4 2025 | +20.7% | +24.4% | +33.5% | |
| Q3 2025 | -6.1% | -8.5% | -8.5% | |
| Q1 2025 | +10.9% | +10.0% | +14.2% | |
| Q4 2024 | -2.1% | +0.8% | -14.7% | |
| Q3 2024 | -0.1% | +3.5% | +5.3% | |
| Q2 2024 | -14.6% | -7.8% | -13.2% | |
| Q1 2024 | -9.0% | -5.2% | -7.7% | |
| Q4 2023 | -11.8% | -7.2% | -5.7% | |
| Q3 2023 | -18.6% | -9.2% | -5.5% | |
| Q2 2023 | +3.8% | +21.6% | +0.8% | |
| Q1 2023 | +3.6% | +6.2% | +12.5% | |
| Q4 2022 | -1.6% | -6.6% | -6.2% | |
| Q3 2022 | -2.8% | -7.6% | -5.8% | |
| Q2 2022 | +1.2% | +0.1% | +1.2% | |
| Q1 2022 | +11.6% | +16.7% | +10.0% | |
| Q4 2021 | +13.3% | +26.2% | +24.5% | |
| Q3 2020 | -10.6% | -10.8% | -9.7% | |
| Q3 2021 | -7.5% | -7.8% | -7.6% | |
| Q2 2020 | -3.7% | -6.5% | -6.1% | |
| Q2 2021 | -2.6% | -7.6% | -6.2% | |
| Q4 2020 | +6.1% | +3.7% | +6.2% | |
| Q1 2020 | +6.1% | +3.7% | +6.2% | |
| Q1 2021 | +3.5% | +8.2% | +8.2% | |
| Q4 2019 | — | — | — | |
| Q3 2019 | — | — | — | |
| Q2 2019 | — | — | — | |
| Q1 2019 | — | — | — | |
| Q4 2018 | — | — | — | |
| Q2 2018 | — | — | — | |
| Q1 2018 | — | — | — | |
| Q4 2017 | — | — | — |
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