Vital Farms, Inc. (VITL) Q2 2026 Earnings Call

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WEBVTT 00:00:00.111 -- 00:00:05.135 Since last quarter, we've made significant progress, and we completed our planned operational 00:00:05.135 -- 00:00:08.177 staffing changes at Egg Central Station. 00:00:08.177 -- 00:00:12.861 In mid-July, we further optimized our organizational structure to improve decision-making 00:00:12.861 -- 00:00:18.025 speed and reduce overhead, aligning our headcount directly with our core 00:00:18.025 -- 00:00:20.167 operational priorities. 00:00:20.167 -- 00:00:25.231 The result is that we've reduced our annualized SG&A run rate by approximately 00:00:25.231 -- 00:00:27.473 $6 to $7 million. 00:00:27.473 -- 00:00:32.535 Furthermore, we intend to pause construction on Vital Crossroads by the end of 2026, 00:00:32.535 -- 00:00:36.056 and we believe CapEx is tightly controlled. 00:00:36.237 -- 00:00:41.360 In short, we expect the second half of 2026 to look fundamentally different than 00:00:41.360 -- 00:00:46.522 the first half of the year. We believe our strategic actions provide a clear 00:00:46.522 -- 00:00:52.305 line of sight to improved operating results in the second half and heading into 2027, 00:00:52.305 -- 00:00:57.696 and Thilo will walk through the specific building blocks behind that view in a moment. 00:00:57.696 -- 00:01:00.677 The expected progression is straightforward. 00:01:00.677 -- 00:01:05.298 Our narrowed price gaps should continue to accelerate velocity over the coming months 00:01:05.298 -- 00:01:10.339 and quarters. And our TDPs are on track this year to expand at the fastest rate 00:01:10.339 -- 00:01:13.260 since our IPO in 2020. 00:01:13.260 -- 00:01:19.001 We expect to improve cost of goods sold as we are shifting our supply management strategy 00:01:19.001 -- 00:01:22.862 to farmer contract amendments and aw...