Karat Packaging Reports Record Second Quarter Results

Karat Packaging, Inc. ( (KRT) ) has released its Q2 earnings. Here is a breakdown of the information Karat Packaging, Inc. presented to its investors.

Karat Packaging Inc. is a specialty distributor and manufacturer of environmentally friendly, disposable foodservice products, serving national and regional restaurants across the United States. The company is known for its eco-friendly Karat Earth® line and offers customized solutions including new product development and logistics services.

In its 2025 second quarter financial report, Karat Packaging announced record quarterly net sales and net income, highlighting its successful navigation of tariff uncertainties through alternative sourcing strategies. The company reported net sales of $124.0 million, a 10.1% increase from the previous year, and a net income of $11.1 million, up 19.8% year-over-year.

Key financial metrics from the report include a gross profit of $49.1 million, a 13.1% increase from the prior year, and an adjusted EBITDA of $17.7 million, up 12.8%. The company also reported a gross margin increase to 39.6% and a net income margin of 8.9%. Strategic moves such as reducing sourcing from China and expanding operations in other Asian countries and Latin America have bolstered its supply chain resilience.

Looking ahead, Karat Packaging expects continued growth with net sales projected to increase by high single-digit to low double-digits in the third quarter. The company maintains its full-year guidance on net sales, gross margin, and adjusted EBITDA margin, despite potential tariff impacts. With new business wins and an operational new warehouse in Chino, the company is poised for further expansion in the second half of the year.