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Oatly Group (OTLY)
NASDAQ:OTLY
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Oatly Group
(NASDAQ:OTLY)
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Rating:47Neutral
Price Target:
$11.00
▼(-6.46% Downside)
The score is held down primarily by weak financial durability—especially the very thin equity base and high leverage alongside ongoing losses and negative free cash flow. Technicals are also soft with the stock below key longer-term moving averages. These are partly offset by a more positive earnings-call outlook featuring margin expansion and improved adjusted EBITDA guidance, but cash flow and regional/customer headwinds keep overall risk elevated.
Positive Factors
Gross Margin Expansion
Sustained gross margin expansion to the low‑to‑mid 30s, driven by supply‑chain absorption and mix/pricing, improves unit economics. Durable higher margins increase operating leverage, support reinvestment in brand and innovation, and materially strengthen long‑term profitability potential.
Shift to Structural Profitability (Adjusted EBITDA)
Achieving positive adjusted EBITDA for the full year and guiding materially higher adjusted EBITDA for 2026 signals a structural shift toward operating profitability. Recurring positive EBITDA would reduce dependency on external capital and enable sustained investment in growth and margin improvement.
Cost and Operational Efficiency
Large, durable cost improvements from supply‑chain restructuring, co‑packer consolidation and facility rationalization have lowered unit COGS and SG&A. These structural efficiency gains improve competitiveness, raise margin floor, and accelerate free‑cash‑flow conversion as volumes scale.
Negative Factors
Weak Balance Sheet / High Leverage
An extremely thin equity base against very high debt leaves minimal loss absorption and creates material refinancing and dilution risk. Limited balance‑sheet cushion constrains strategic flexibility, elevates funding risk in stressed markets, and is a persistent vulnerability until materially delevered.
Persistent Negative Free Cash Flow
Despite progress, the company remains a net cash user with negative operating and free cash flows. Continued cash burn necessitates external financing, limits ability to self‑fund capex or M&A, and delays durable deleveraging even as EBITDA improves, creating ongoing execution risk.
Customer Concentration / North America Headwind
Dependence on a large foodservice customer that drove a material revenue decline creates structural volatility. Customer concentration risks recurring top‑line swings, complicates predictable growth and margin planning, and underscores the challenge of converting out‑of‑home success into stable retail gains.
Oatly Group (OTLY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$376.57M
Dividend YieldN/A
Average Volume (3M)73.14K
Price to Earnings (P/E)―
Beta (1Y)1.21
Revenue Growth3.37%
EPS Growth46.17%
CountryUS
Employees1,468
SectorConsumer Defensive
Sector Strength42
IndustryBeverages - Non-Alcoholic
Share Statistics
EPS (TTM)-0.61
Shares Outstanding30,326,654
10 Day Avg. Volume86,091
30 Day Avg. Volume73,145
Financial Highlights & Ratios
PEG Ratio0.08
Price to Book (P/B)17.50
Price to Sales (P/S)0.38
P/FCF Ratio-8.99
Enterprise Value/Market Cap2.17
Enterprise Value/Revenue0.95
Enterprise Value/Gross Profit2.95
Enterprise Value/Ebitda-11.62
Forecast
1Y Price Target
$15.83Price Target Upside34.61% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)-2.81
Revenue Forecast (FY)$903.26M
Oatly Group Business Overview & Revenue Model
Company DescriptionOatly Group AB, an oatmilk company, provides a range of plant-based dairy products made from oats in Sweden. It offers Barista edition oatmilk, oatgurts, frozen desserts, ice-creams, and yogurts; ready-to-go drinks, such as cold brew latte, mocha latte, matcha latte, and mini oat drink in original and chocolate flavors; and cooking products, including Cooking Cream, in regular and organic, Crème Fraiche, Whipping Cream, Vanilla Custard and Spreads in a variety of flavors. The company was formerly known as Havre Global AB and changed its name to Oatly Group AB in March 2021. The company was founded in 1994 and is headquartered in Malmö, Sweden.
How the Company Makes MoneyOatly generates revenue primarily through the sale of its oat-based products across various retail channels, including supermarkets, cafes, and restaurants. The company's revenue model includes direct-to-consumer sales, partnerships with food service providers, and distribution agreements with major retailers. Key revenue streams include sales of oat milk, which is its flagship product, as well as other oat-based offerings. Significant partnerships with major coffee chains and restaurants enhance Oatly's market presence and contribute to earnings. Additionally, Oatly has expanded its product range and entered new markets, further strengthening its revenue potential.
Oatly Group Earnings Call Summary
Earnings Call Date:Feb 11, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 06, 2026
Earnings Call Sentiment Positive
The call highlighted a meaningful turnaround: Oatly achieved its first full year of profitable growth, delivered improved gross margins, positive adjusted EBITDA in Q4 and for the year, meaningful volume and market-share gains (notably across Europe), and substantial structural cost improvements. Management provided concrete product innovation plans and a clear growth playbook with 2026 guidance that targets modest top-line growth (3%–5% constant currency) and stronger adjusted EBITDA ($25M–$35M). Offsetting these positives, challenges remain: North America experienced a revenue decline driven by a large foodservice customer (creating a ~200 bps headwind), Greater China is under review with slight revenue declines, free cash flow is still negative (net outflow $39M) and category softness in U.S. retail persists. On balance, the highlights—profitability, margin expansion, market-share gains, and operational efficiencies—outweigh the lowlights and point to continued progress toward sustainable profitable growth, though execution risks (customer concentration, China, and retail conversion) remain.Q4-2025 Updates
Positive Updates
First Full-Year Profitable Growth
Oatly delivered its first full year of profitable growth since IPO: full-year adjusted EBITDA of $6.8 million and management calling the company 'structurally profitable' and entering a 'profitable growth era.' 2026 adjusted EBITDA guidance of $25M–$35M indicates expected acceleration.
Top-Line Growth — Q4 and Full Year
Q4 revenue grew 9.1% (4.3% constant currency). Full-year revenue grew 4.7% (2.2% constant currency). 2026 revenue guidance is +3% to +5% on a constant currency basis (includes ~200 bps headwind from a large North America customer).
Significant Gross Margin Expansion
Q4 gross margin was 34.5%, up ~580 basis points year-over-year. Full-year gross margin improved to over 32%, +2,100 basis points versus 2022. Supply chain absorption and efficiencies contributed ~400 bps and pricing/product mix added ~200 bps in Q4.
Volume and Market Share Gains
Company sold more volume than ever in 2025 — 18% more than 2022. Q4 volume increased 2.9% overall; Europe & International volume grew 13.9% in the quarter. Oatly expanded retail market share across all measured European markets and became #1 plant-based drink brand in Germany.
Segment Outperformance and Profitability
Europe & International delivered solid growth (established markets +7%, expansion markets +54%) and a $9.9M increase in segment adjusted EBITDA. North America (excluding a large foodservice customer) grew ~10% in Q4 and reported its highest-ever quarterly segment profit ($4.4M). Greater China reported $1.1M adjusted EBITDA despite slightly lower revenue.
Cost, Efficiency and Structural Improvements
Since turnaround began in 2022: revenue up 19%, adjusted EBITDA improved by $275M, and free cash flow improved by $436M. Management reduced cost of goods sold per liter by 23% and reduced total SG&A by nearly $100M (≈21% of revenue) through supply-chain restructuring, co-packer consolidation and the closure of the Singapore facility.
Cash Flow Progress and Balance Sheet Actions
Full-year free cash flow outflow of $39M, an improvement of $117M versus prior year. Company completed refinancing actions (convertible note reduction) producing an estimated ~$5M of annual non-cash interest savings.
Product Innovation and Consumer Relevance
Management is rolling out a 'refreshed growth playbook' and new innovations: flavored Barista lineup expansions (e.g., churros, coconut), matcha retail launches, baristamatic for automatic machines, and a new cold-form Barista product. Company is also launching a fiber-focused campaign leveraging its product nutrition profile to drive adoption.
Negative Updates
North America Large Customer Drag and Revenue Decline
Reported North America revenue declined 8.8% in the quarter, primarily due to sourcing changes at one large foodservice customer. Management notes this customer will create an approximate 200 bps headwind to full-year 2026 net sales growth; the customer's share of the segment has fallen to below 10% in the quarter but concentration risk remains a near-term headwind.
Negative Free Cash Flow Persisting
Full-year free cash flow remained negative with a net outflow of $39M in 2025. Management expects improvement in 2026 but does not expect full-year positive free cash flow in 2026.
Greater China Challenges and Strategic Review
Greater China constant currency revenue declined slightly in the period, impacted by customer order timing shifts; management announced a strategic review of the Greater China segment and is evaluating options including a potential carve-out, signaling unresolved execution or structural issues in the region.
Oat Milk Category Softness in U.S. Retail
Management acknowledged that the oat milk category remains under pressure in U.S. traditional retail. Category softness persists, and converting out-of-home momentum into retail gains is constrained by timing of retail shelf resets and the complexity of the U.S. retail channel.
Foreign Exchange and SG&A Headwinds
While FX acted as a revenue tailwind in the quarter (~+4.8% noted in bridging items), FX also produced a ~$7M headwind in SG&A and introduces variability to reported results; FX impacts both revenue and expense lines inconsistently.
Higher Near-Term CapEx
2026 CapEx guidance of $20M–$30M is higher than 2025 driven by phased projects and European capacity additions. While management calls the expansion disciplined, higher near-term capex delays free cash flow conversion timing.
Company Guidance
Oatly guided that for 2026 it expects constant‑currency net sales growth of 3–5% (which already embeds an approximate 200 basis‑point headwind from a large North America customer and assumes current FX; management estimates FX could add ~100–200 bps to full‑year net sales), adjusted EBITDA of $25–35 million, and capex of $20–30 million; the company said it does not expect to deliver positive free cash flow for the full year 2026 but does expect free cash flow to improve versus 2025 (FY‑2025 free cash flow was a net outflow of $39 million, an improvement of $117 million year‑over‑year) and highlighted about $5 million of expected non‑cash interest savings from recent refinancing, an ongoing focus on supply‑chain efficiencies and continued brand‑building investment (particularly in H1), and that the guidance assumes no direct impact from U.S. tariffs.Oatly Group Financial Statement Overview
Summary
Operating performance is improving (stronger TTM revenue, gross margin up to ~30.6%, and meaningfully narrowed losses), but the overall financial profile remains pressured by continued unprofitability (TTM net margin ~-26.7%), negative operating/free cash flow (TTM FCF ~-$37M), and a materially weakened balance sheet with very thin equity (~$18.6M) versus high debt (~$513.7M), elevating funding/refinancing risk.Income Statement
OTLY shows clear progress in operating performance, but profitability remains weak. Revenue in TTM (Trailing-Twelve-Months) is up strongly versus 2024, and gross margin improved to ~30.6% (from ~28.7% in 2024 and ~19.4% in 2023), signaling better pricing/mix and/or cost control. Losses have narrowed meaningfully from 2022–2023 levels, with operating losses improving versus prior years. However, the company is still unprofitable in TTM (net margin ~-26.7%) and continues to run negative operating earnings, which keeps the income statement score below average despite the improving trajectory.38
Negative
Balance Sheet
The balance sheet has deteriorated materially from a leverage and cushion standpoint. Stockholders’ equity has compressed sharply to ~$18.6M in TTM (from ~$104.7M in 2024 and ~$334.0M in 2023), which leaves very limited buffer against ongoing losses. Total debt is high at ~$513.7M, and leverage is extreme with debt-to-equity around ~29x in TTM (up from ~4.7x in 2024). Returns on equity are deeply negative due to losses, and the thin equity base elevates refinancing and dilution risk.18
Very Negative
Cash Flow
Cash generation remains a challenge, but near-term burn appears to be improving. In TTM (Trailing-Twelve-Months), operating cash flow is still negative (~-$23.7M) and free cash flow is negative (~-$37.0M), meaning the business is not yet self-funding. That said, cash outflow is substantially better than 2024 (operating cash flow ~-$114.4M; free cash flow ~-$155.6M), indicating progress on working capital and/or spending discipline. The key weakness is that cash flow is still negative overall and free cash flow has worsened versus the prior period in growth terms, leaving continued reliance on external capital.30
Negative
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 862.46M | 823.67M | 783.35M | 722.24M | 643.19M |
| Gross Profit | 277.06M | 236.49M | 152.08M | 80.03M | 155.01M |
| EBITDA | -19.16M | -86.13M | -287.79M | -335.15M | -172.15M |
| Net Income | -152.77M | -201.95M | -416.87M | -392.57M | -212.39M |
Balance Sheet | |||||
| Total Assets | 787.20M | 803.98M | 1.12B | 1.23B | 1.63B |
| Cash, Cash Equivalents and Short-Term Investments | 64.34M | 98.92M | 249.30M | 82.64M | 545.51M |
| Total Debt | 513.72M | 491.45M | 532.84M | 151.70M | 149.21M |
| Total Liabilities | 767.53M | 697.86M | 781.19M | 434.05M | 383.61M |
| Stockholders Equity | 18.55M | 104.69M | 333.99M | 791.14M | 1.25B |
Cash Flow | |||||
| Free Cash Flow | -36.12M | -155.62M | -234.67M | -475.11M | -495.43M |
| Operating Cash Flow | -23.72M | -114.43M | -165.63M | -268.95M | -213.83M |
| Investing Cash Flow | -15.54M | -9.25M | -26.70M | 34.79M | -544.33M |
| Financing Cash Flow | 1.18M | -27.29M | 355.00M | 35.92M | 955.80M |
Oatly Group Technical Analysis
Neutral
11.76
Price Trends
11.37
Positive
12.69
Negative
13.47
Negative
Market Momentum
0.15
Negative
51.68
Neutral
69.45
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OTLY, the sentiment is Neutral. The current price of 11.76 is above the 20-day moving average (MA) of 11.46, above the 50-day MA of 11.37, and below the 200-day MA of 13.47, indicating a neutral trend. The MACD of 0.15 indicates Negative momentum. The RSI at 51.68 is Neutral, neither overbought nor oversold. The STOCH value of 69.45 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for OTLY.
Oatly Group Risk Analysis
Oatly Group disclosed 75 risk factors in its most recent earnings report. Oatly Group reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Oatly Group Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $2.85B | 43.45 | 24.16% | ― | 23.12% | 16.20% | |
70 Outperform | $4.40B | 13.78 | 25.18% | 4.78% | 18.92% | 34.03% | |
70 Outperform | $3.45B | 18.36 | 40.93% | ― | 0.97% | 0.36% | |
68 Neutral | $14.55B | 25.03 | 168.34% | 0.61% | 4.22% | 22.24% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
47 Neutral | $376.57M | ― | -248.60% | ― | 3.37% | 46.17% | |
46 Neutral | $123.76M | -7.43 | -23.12% | ― | 6.17% | 41.09% |
* Consumer Defensive Sector Average
OTLY
Oatly Group
11.76
4.48
61.47%
COKE
Coca-Cola Bottling Co Consolidated
182.22
44.19
32.01%
AKO.A
Embotelladora Andina SA
24.50
9.23
60.45%
FIZZ
National Beverage
37.01
-3.99
-9.73%
ZVIA
Zevia PBC
1.66
-1.64
-49.70%
COCO
Vita Coco Company
53.96
16.21
42.94%
Oatly Group Corporate Events
Oatly Posts Higher Revenue and Margin as It Delivers First Full Year of Profitability in 2025
Feb 11, 2026
On February 11, 2026, Oatly reported its financial results for the fourth quarter and full year ended December 31, 2025, marking its first full year of profitability as described by management. The company posted fourth-quarter revenue of $233.8 million, up 9.1% year on year, or 4.3% in constant currency, with gross margin improving to 34.5%, a gain of 5.8 percentage points versus the prior-year period.
Full-year 2025 revenue rose 4.7% to $862.5 million, or 2.2% in constant currency, driven by double-digit reported growth in Europe & International and Greater China, partially offset by revenue declines in North America. Management highlighted that strategic actions over the past three years, including rightsizing its supply chain and overhead while reinvesting behind a refreshed growth strategy, have improved profitability and cash flow and are supporting profitable growth across markets where its playbook is fully implemented.
The most recent analyst rating on (OTLY) stock is a Hold with a $10.50 price target. To see the full list of analyst forecasts on Oatly Group stock, see the OTLY Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.