Is OTLY a Buy? What to Consider in 2026
Short answer
The bull case for Oatly Group (OTLY) rests on First full year of positive adjusted EBITDA: FY2025 marked Oatly's first full year of positive adjusted EBITDA, at about $6.8 million, a milestone after years of deep operating losses. Revenue (FY2025) is ~$862.5M (+4.7% YoY). If you believe that thesis holds, the real questions become position sizing and overlap, not timing. The main risk to that view: The plant-based category has cooled from its pandemic-era peak as some consumers return to dairy, which pressures volumes across the segment. Whether OTLY is a buy comes down to whether you believe the thesis. This is informational, not a recommendation, and Walnut is not an investment adviser.
Oatly Group AB is a plant-based food and drink company best known for popularizing oat milk, alongside a broader range of oat-based products such as barista drinks, frozen treats, yogurt alternatives, spreads, and cooking products. It sells through retail grocery channels and foodservice partners, including coffee shops, and reports across three regions: Europe & International, North America, and Greater China. The company makes money by manufacturing oat base and finished goods and selling them to retailers and foodservice customers, so its results hinge on volume growth, pricing, the cost of oats and production, and how efficiently its factory network runs. Oatly went public on the Nasdaq in May 2021 at $17 per ADR, opening near $22 and briefly carrying a valuation above $10 billion amid peak enthusiasm for plant-based eating. The stock then fell sharply over the following years as the company missed production targets, struggled with capacity expansion, and watched rivals take share, leaving the market value down roughly 98% from its peak. In response, management spent 2023 through 2025 restructuring: it halted or closed several planned and existing factories (including projects in the UK, Texas, Singapore, and China), cut overhead, and focused on margin recovery. In February 2025 Oatly changed its ADR ratio in a 1-for-20 reverse split to lift the per-share price and maintain its listing.
What's the case for buying OTLY?
1. First full year of positive adjusted EBITDA.
FY2025 marked Oatly's first full year of positive adjusted EBITDA, at about $6.8 million, a milestone after years of deep operating losses. Management guided to adjusted EBITDA of roughly $25 million to $35 million in 2026, implying it expects the profitability trend to continue. This shift is the core of the turnaround thesis, though adjusted EBITDA excludes significant real costs such as restructuring and financing.
2. Gross margin recovery.
Gross margin has climbed substantially, with Q4 2025 gross margin around 34.5%, up from the high-20s a couple of years earlier and a low of roughly 11% during the worst of the supply-chain problems. The improvement reflects better factory utilization, supply-chain fixes, and overhead cuts, with SG&A falling to about 37% of revenue from a 2022 peak above 57%. Sustaining these gains is central to reaching consistent profitability.
3. Slow but positive revenue and volume growth.
FY2025 revenue was about $862.5 million, up roughly 4.7% year over year, with finished-goods volume of about 593 million liters, up about 5.3%. For 2026 the company guided to constant-currency revenue growth of roughly 3% to 5%. Growth is modest rather than explosive, so the story depends more on margins and cost discipline than on a return to hyper-growth.
4. Restructured, leaner footprint.
Over 2023 to 2025 Oatly canceled or closed several factory projects (including sites in the UK, Texas, Singapore, and China) and cut overhead to match a more realistic demand picture. The leaner footprint lowers fixed costs and capital needs and is a major reason margins improved. The trade-off is less spare capacity for upside if demand reaccelerates.
What are the risks to OTLY?
The plant-based category has cooled from its pandemic-era peak as some consumers return to dairy, which pressures volumes across the segment. Competition is intense from Danone's Silk and Alpro, Hood's Planet Oat, Califia Farms, private label, and others, and Oatly's past supply problems let rivals win shelf space and foodservice slots. Despite improving margins, the company still posted a large net loss (about $152.8 million in FY2025) and carries a heavy debt load against modest cash (about $64 million at year-end 2025), so the path to sustained net profitability and the risk of further share issuance or refinancing are real concerns. As a small-cap ADR reporting in US dollars while earning much of its revenue abroad, the stock also carries currency translation effects and the structural features of an ADR.
How is OTLY valued? (as of FY2025 results (year ended December 31, 2025) and Q4 2025)
- Revenue (FY2025): ~$862.5M (+4.7% YoY)
- Gross margin (Q4 2025): ~34.5%
- Adjusted EBITDA (FY2025): ~$6.8M (first full-year positive)
- Net loss (FY2025): ~$152.8M (narrowed ~24%)
- Cash & equivalents: ~$64M (end of 2025)
- Market cap: ~$0.3-0.4B (early 2026)
Reading a turnaround consumer brand like Oatly means watching the trajectory of profitability more than a simple P/E, since the company is not consistently net-profitable. The constructive signals are rising gross margin, the first full year of positive adjusted EBITDA, and slow but positive volume growth; the cautionary signals are the still-large net loss, a heavy debt load relative to a modest cash balance, and the gap between adjusted EBITDA and actual net results. Because the cash runway and financing terms matter to whether the turnaround completes, the balance sheet deserves as much attention as the income statement.
How do you decide if OTLY is a buy?
Rather than asking whether OTLY is a buy in the abstract, it tends to help to answer four questions:
- Thesis: do you believe the case above, and is it still true today?
- Time horizon: a single stock can be volatile, so a longer horizon absorbs more of the swings.
- Position sizing: a thesis can be right and the sizing still wrong; decide how much of your portfolio one name should be.
- Overlap: check whether you already hold OTLY indirectly through an index or sector ETF before adding more.
For the full picture, see the OTLY stock guide (what the company does, the ETFs that hold it, similar stocks, and the themes it fits). In Walnut you can ask its AI about OTLY against your real portfolio and see your actual exposure before deciding.
The bottom line on OTLY
The bottom line: Oatly Group's story right now is First full year of positive adjusted EBITDA, with revenue (fy2025) at ~$862.5M (+4.7% YoY). If you believe that narrative continues, the call is about sizing OTLY sensibly and checking overlap with what you own; if you doubt it (the risk: the plant-based category has cooled from its pandemic-era peak as some consumers return to dairy, which pressures volumes across the segment.), it is not for you. Decide from the thesis, not the ticker. Walnut is not an investment adviser.
Build a basket around OTLY with Walnut
Use Oatly Group as one constituent in a thematic basket Walnut's AI helps you assemble. Describe a thesis you believe in, the AI proposes the holdings and weights, and you approve before any broker order.
FAQ
Is OTLY a good stock to buy right now?
+
The case for Oatly Group right now is First full year of positive adjusted EBITDA, with revenue (fy2025) at ~$862.5M (+4.7% YoY). If you believe that thesis holds, OTLY is a way to own it and the real questions are sizing and overlap, not timing; the main risk to that view is the plant-based category has cooled from its pandemic-era peak as some consumers return to dairy, which pressures volumes across the segment. So it comes down to whether you believe the thesis. Walnut is not an investment adviser and this is not a recommendation.
What does Oatly Group do?
+
Sweden-based maker of oat milk and plant-based dairy alternatives, US-traded as an ADR, pursuing a turnaround toward profitability after a steep post-IPO decline.
What are the main risks of OTLY?
+
The plant-based category has cooled from its pandemic-era peak as some consumers return to dairy, which pressures volumes across the segment. Competition is intense from Danone's Silk and Alpro, Hood's Planet Oat, Califia Farms, private label, and others, and Oatly's past supply problems let rivals win shelf space and foodservice slots. Despite improving margins, the company still posted a large net loss (about $152.8 million in FY2025) and carries a heavy debt load against modest cash (about $64 million at year-end 2025), so the path to sustained net profitability and the risk of further share issuance or refinancing are real concerns. As a small-cap ADR reporting in US dollars while earning much of its revenue abroad, the stock also carries currency translation effects and the structural features of an ADR.
What does Oatly do?
+
Oatly is a Sweden-based plant-based food and drink company best known for oat milk. It makes oat-based drinks, barista products, frozen desserts, yogurt alternatives, spreads, and cooking products, selling them to grocery retailers and foodservice partners such as coffee shops across Europe and International, North America, and Greater China. OTLY trades in the US as an American Depositary Receipt.
Does OTLY pay a dividend?
+
No. Oatly does not pay a dividend. It is a turnaround-stage company still working toward consistent net profitability and reinvesting in the business, so any potential return to shareholders would come from share-price appreciation rather than income.
Is OTLY a good stock?
+
This is descriptive, not advice. The bull case is a turnaround: gross margins have improved sharply, 2025 was the first full year of positive adjusted EBITDA, and revenue and volume are growing modestly. The bear case is a softening plant-based category, intense competition, a still-large net loss, and a heavy debt load. Whether it fits depends on your own goals and risk tolerance.
Is OTLY a good stock to buy right now?
+
This is informational, not a recommendation. OTLY trades like a speculative small-cap turnaround, with sharp swings tied to each quarter's margin and profitability progress against category and balance-sheet pressures. Some investors weigh the improving margins and adjusted EBITDA against the net losses and debt. Walnut provides information, not investment advice.
Walnut is informational and is not an investment adviser. This page is educational and not a recommendation to buy or sell OTLY; figures are approximate and dated, and your own situation, time horizon, and risk tolerance should drive any decision. Verify current data before investing.