11:22 AM EDT, 08/13/2026 (MT Newswires) -- Yeti (YETI) lifted its full-year earnings outlook on Thursday following a surprise year-over-year increase in its fiscal second-quarter bottom line, although the outdoor products company flagged weakness in its drinkware category in the US amid market pressure and competition.

The company now anticipates adjusted earnings to come in between $2.94 and $3 per share for fiscal 2026, up from its previous projections of $2.83 to $2.89. The current consensus on FactSet is for non-GAAP EPS of $2.89.

The improved guidance reflects the firm's operating performance so far this year and the benefit of International Emergency Economic Powers Act tariff refunds, partially offset by an increase in inflationary pressures related to commodity transportation, distribution and fulfillment, Chief Financial Officer Scott Bomar said during an earnings call, according to a FactSet transcript.

Yeti expects a roughly 600-basis-point drag on its drinkware growth in the US this year from three main stock keeping units, "all tied to the wealth publicized but narrow trend-driven momentum and share swapping that is played out in the category over the past few years," Chief Executive Matt Reintjes said on the call.

"That is a significant headwind, but it has been more than counterbalanced by strong execution of our diversification and innovation strategy across the rest of the platform," according to Reintjes. "The products driving the headwind will largely complete their lap by year-end, resetting the base as we head into 2027."

Yeti continues to project sales to grow by 7% to 8% for the ongoing fiscal year, while the Street is looking for $2.01 billion, reflecting an annual increase of 7.6%.

Shares of the company fell 12% in Thursday trade, reducing its year-to-date gain to 1.1%.

For the quarter ended July 4, the firm's adjusted EPS ticked up to $0.67 from $0.66 the year before, defying the average analyst estimate for a decline to $0.54. Sales climbed 9% to $483.9 million, just ahead of the Street's view $483.8 million, buoyed by robust customer demand across channels and persistent international momentum, Yeti said.

UBS Securities expected Yeti to report solid revenue growth in the quarter driven by favorable category dynamics, innovation and international expansion, according to a note sent last week.

"In an uneven consumer environment, demand across our product platforms remained strong," Reintjes said in the earnings release. "We also saw continued progress across our omni-channel model, including strong wholesale sell-through, healthy (direct-to-consumer) demand and improving trends in corporate sales."

Sales of coolers and equipment jumped 16% to $232.4 million, while drinkware rose 2% to $241.4 million. In the US, drinkware revenue was flat amid continued market pressure and competition, Bomar told analysts on the call. Sales from the direct-to-consumer and wholesale channels gained 7% and 10%, respectively.

In July, Hydro Flask maker Helen of Troy (HELE) raised its fiscal 2027 sales outlook after a stronger-than-expected fiscal first quarter. Stanley Black & Decker (SWK), which competes with Yeti in the premium insulated tumbler and mug industry, lifted its full-year earnings outlook last month.

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