Karat Packaging Inc (NASDAQ: KRT) is a disposable foodservice packaging company that distributes and sells packaging products to restaurants, distributors, retailers, and online customers across the United States. Revenue is transactional, generated by selling cups, bags, and related foodservice packaging products through three channels: chains and distributors, retail, and e-commerce. Chain and distributor revenue reached $370.6 million for the year ended December 31, 2025, representing approximately 64.7% growth versus the year ended December 31, 2020. The company operates ten distribution centers nationwide, owns a fleet of 40 trucks and 46 trailers as of December 31, 2025, and manufactures a portion of its products domestically, with manufacturing accounting for approximately 9% of net sales in FY2025, down from 11% in FY2024. Karat Packaging also sells through third-party e-commerce storefronts including Amazon, Walmart, eBay, TikTok, and Sysco. Gross profit was $172.1 million and gross margin was 36.8% for the year ended December 31, 2025, with freight and duty costs rising to 11.8% of net sales in FY2025 from 8.2% in FY2024.

Revenue model

Transactional product sales across three channels: chains and distributors (national and regional restaurant chains and resellers), retail (bubble tea shops, coffee shops, small restaurants), and e-commerce (small businesses and individual consumers via Amazon, Walmart, eBay, TikTok, and Sysco). Floor stocking agreements with a subset of national and regional chain customers provide partial revenue visibility. The company also generates a small amount of revenue from logistics and transportation services.

Products and services

Disposable foodservice packaging products including cups, bags, and related items sold under the Karat brand. Karat Earth is a specialty line of environmentally-friendly, largely BPI-certified compostable and plant-based packaging products introduced as early as 2008, including PLA-based plastic products. The company also offers specialty beverage ingredients and related items through its retail channel.

Customers and end markets

Primary customers include fast casual restaurants (Applebee's, Chili's, PF Chang's, Chipotle, Olive Garden), fast food chains (Coffee Bean and Tea Leaf, El Pollo Loco, In-N-Out Burger, Jack in the Box, Panda Express, Raising Cane's Chicken Fingers), national and regional distributors, supermarket chains, convenience stores, bubble tea and coffee shops, and small online buyers. End markets are driven by foodservice, food delivery, and takeout dining demand.

Value-chain role

Distributor and manufacturer of disposable foodservice packaging. The company sources products from a global vendor network, manufactures approximately 9% of net sales domestically (FY2025), and distributes through ten owned distribution centers with a proprietary fleet. It functions as a one-stop supplier between manufacturers and foodservice operators or resellers.

Geographic exposure

United States nationwide distribution through ten distribution centers, including two opened in the past 24 months in Chino, California and Mesa, Arizona as of December 31, 2025. The company sources products globally and is actively diversifying its vendor network across multiple countries.

Source: SEC 10-K, filed 2026-03-13

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