YETI’s Bold Move Out Of China Amid Rising Tariff Tensions

The acquisition of Mystery Ranch has resulted in YETI's first joint product line called Ranchera, ... More launched in March, expanding YETI's presence in outdoor, travel, and technical pack categories.
Courtesy of YETI
The recent tariff increases in the U.S. have been a headwind for YETI, as it estimated that a 145% total tariff rate on products sourced from China and a 10% reciprocal tariff rate on products from other countries would result in a gross tariff impact estimated at approximately $100 million (about 90% related to China). However, YETI plans to accelerate its growth despite tariffs through diversification of its supply chain, continued international expansion, and robust product development.
The company has focused on diversifying its supply chain for the past two years, allowing it to be less reliant on China for its production. "Our project started in 2023, is ahead of plan, and we now expect 90% of our U.S. drinkware capacity to be ex-China by the end of the year. For context, on a go-forward basis, we expect to have less than 5% of our total cost of goods related to products from China for the U.S. market," said Matt Reintjes, CEO of YETI, in the recent earnings call.
YETI’s Growth Strategy Despite Tariffs
"YETI's three key focus areas in this unique moment in time are accelerating the pace of product innovation, materially transforming our supply chain, minimizing exposure to China, and delivering operating discipline to maintain our fortress balance sheet," said Reintjes. The company posted a 3% revenue increase for the first quarter (Q1) of 2025, with the direct-to-consumer sales up 4% while the wholesale channel was up 1%.
Product Evolution At YETI
YETI continues to demonstrate its commitment to product innovation and category expansion across multiple fronts. "For the year, we expect over 30 new product introductions versus 24 last year and a meaningful number of additional next-generation releases," said Reintjes. Coolers and Equipment sales increased 17% in Q1, mainly from bags and coolers. YETI has invested in technological advancements to further its product development roadmap.
The company has strategically acquired powered cooler technology, enabling the development of iceless portable refrigeration units that maximize storage space without sacrificing performance. "A powered cooler means that you wouldn’t need ice, so instead of space being filled up with ice to keep things cold, you actually have more space for storing goods," explained Reintjes in an interview.