Key Highlights
- CELH shares plummeted more than 16% in premarket hours following disappointing Q2 financial results
- Earnings per share of $0.36 fell short of the $0.43 Street estimate by a significant margin
- Quarterly revenue reached $817.9M but missed analyst projections of $885.98M, though up 11% annually
- Core Celsius brand experienced an 11.7% revenue decline compared to the prior-year period
- Alani Nu delivered exceptional performance with retail sales jumping 55.7% year-over-year
Shares of Celsius Holdings (CELH) tumbled over 16% during Thursday’s premarket session following the energy drink company’s second-quarter earnings report that disappointed investors with misses on both revenue and profit metrics.
Premarket activity showed the stock hovering near $24.27, a substantial retreat from its 52-week peak of $66.74.
The company reported adjusted earnings of $0.36 per share, falling $0.07 short of the analyst consensus target of $0.43. Total revenue reached $817.9 million, coming in below Wall Street’s $885.98 million forecast, although this marked an 11% increase from the $739.3 million generated in the comparable quarter of 2024.
The company’s adjusted EBITDA declined 12% on a year-over-year basis to $184.2 million, falling short of the anticipated $198.4 million.
The flagship Celsius energy drink brand faced significant headwinds during the quarter. Sales declined 11.7% compared to last year, pressured by elevated trade and promotional investments, timing issues related to inventory rebalancing efforts, weakness in the wholesale club channel, and product portfolio optimization following recent acquisitions.
Retail performance for the Celsius brand showed a 2% decline in the quarter, while Rockstar Energy experienced a steeper 13% drop.
Alani Nu Emerges as Growth Driver
The Alani Nu brand delivered exceptional results as the portfolio’s top performer. Sales reached $364.4 million throughout the quarter, propelled by robust consumer interest and elevated order volumes as the brand completed its integration into the PepsiCo (PEP) distribution network.
Alani Nu’s retail performance surged 55.7% versus the prior year. A limited-edition Purple Cotton Candy flavor launch provided additional tailwinds to the brand’s quarterly performance.
The Rockstar Energy brand contributed $66.5 million to total quarterly revenue.
Profit margins faced compression as gross margin declined to 48.1% from 51.5% in the year-ago quarter. Management cited intensified promotional spending and unfavorable channel mix as primary factors, with rising aluminum costs adding additional margin pressure.
Overseas Markets Deliver Solid Performance
Revenue from international operations climbed 10% to reach $27.2 million, with Scandinavian markets and emerging territories such as the UK, Ireland, France, and Australia contributing to the expansion.
North American revenue increased 11% to $790.7 million for the period.
Chief Executive Officer John Fieldly highlighted the company’s market position. “With two billion-dollar brands and roughly one in five energy drinks sold in the United States coming from our portfolio, we are a key growth engine for the category,” he stated.
The combined brand portfolio commanded approximately 20.1% dollar share in the domestic ready-to-drink energy drink market during the quarter.
CELH accounted for roughly 30% of the $640 million expansion in the U.S. zero-sugar energy category throughout the reporting period.
Shares of PepsiCo, which maintains an 11% ownership position in CELH, gained 0.5% in premarket trading following the earnings release.
At the time of publication, CELH was changing hands around $24.27 in premarket activity, significantly below its annual high.
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