Oatly is making “solid progress” towards profitability showing double-digit revenue and volume gains in North America in the third quarter.
In its quarterly earnings report this morning, the Swedish oat milk brand posted total revenue of $208 million, a 10.9% increase from the prior year period. North America sales were $69 million, an 18.1% improvement from Q3 2023. Volume in the segment was up 17.6% year-over-year.
“We still have plenty of work to do to realize what we believe to be our full potential, but clearly, we are making good, healthy progress,” said Oatly CEO Jean-Christophe Flatin in prepared remarks. “We’ll maintain our North Star of driving the business towards structural, consistent, profitable goals.”
Gross margin in the third quarter was 29.8% with adjusted EBITDA loss at $5 million, compared to a $36 million loss in Q3 2023.
Looking specifically towards the North America segment, adjusted EBITDA improved to $3.3 million, a $11.3 million positive swing year-over-year from -$8 million in Q3 2023. The improvement was attributed to a focus on controlling costs through lower selling and administrative expenses.
Launched in January, Oatly’s new products, Super Basic and Unsweetened, were reflected as a -$12.5 million expense in North America for the first nine months of FY2024. Flatin reported that Oatly’s exit from its U.S. manufacturing facility remains “on track” and its previously announced cost-savings program was “largely complete.”
Oatly COO Daniel Ordoñez emphasized the company’s North American revenue growth in both retail (+16.3%) and foodservice (+19.8%) channels year-over-year. Oatly is focused on driving gains in refrigerated where it is expanding its distribution with Walmart and Costco as well as bringing its products back to Kroger shelves after a two-year hiatus.
Approximately 52% of Oatly’s North American revenue was from the retail channel in Q3, compared to 53% in the prior year period. In comparison to the total North American non-dairy and oat milk categories, Oatly reported it has captured 5.8% and 26.6% in the 4-week period ending October 5, according to Nielsen data provided to the company.
Ordoñez hailed its “solid results” in North America to the company’s “disciplined execution.”