CELH — Celsius Holdings, Inc.

Summary of Celsius Holdings Q4 2025 Earnings Call

1. Key Financial Results and Metrics

• Full Year Revenue: Record revenue of $2.5 billion, with Q4 revenue approximately $722 million.
• Brand Performance:
  • CELSIUS: $1.46 billion in net sales, up 7.5% year-over-year.
  • Alani Nu: $370 million in Q4 net sales, reflecting a pro forma growth of 136% compared to the prior year.
  • Rockstar: $56 million in net sales for the full year, with additional $13 million recorded as other income due to integration accounting.
• Gross Profit: Increased to $341.8 million in Q4, with a gross profit margin of 47.4%, down from 50.2% year-over-year.
• Net Income: Q4 net income of $24.7 million; full year net income of $108 million.
• Adjusted EBITDA: Q4 adjusted EBITDA of $134.1 million (18.6% margin) and full year adjusted EBITDA of $619.6 million (24.6% margin).
• Cash Position: Ended the year with $399 million in cash and $670 million in total debt.

2. Strategic Updates and Business Highlights

• Portfolio Growth: CELSIUS, Alani Nu, and Rockstar collectively represent about 20% of the U.S. energy market.
• Integration Progress: Alani Nu is transitioning into the PepsiCo distribution system, with substantial completion expected by Q1 2026. Rockstar integration is on track for completion in the first half of 2026.
• Innovation Focus: Introduction of new products, including the Fizz-Free line and limited-time offers (LTOs) to drive consumer engagement and trial.
• Marketing Strategy: Establishment of an in-house brand studio to enhance marketing capabilities and streamline brand messaging across all consumer touchpoints.

3. Forward Guidance and Outlook

• 2026 Expectations: Anticipate continued revenue growth driven by expanded distribution and innovation, with a focus on maintaining brand loyalty and relevance.
• Margin Recovery: Gross margins expected to return to the low 50s by the end of 2026, with operational efficiencies and cost management strategies in place.
• International Expansion: Plans to grow presence in international markets, leveraging local partnerships and disciplined entry strategies.

4. Bad News, Challenges, or Points of Concern

• Margin Pressures: Q4 gross profit margins were impacted by integration costs and tariffs, raising concerns about cost management during the transition phases.
• Sales Variability: There may be ongoing variability in reported sales due to timing and sequencing of inventory movements and promotional activities.
• Competitive Landscape: Increased competition in the energy drink market may pressure pricing and market share, particularly as consumer preferences evolve.

5. Notable Q&A Insights

• Shelf Space Gains: Significant distribution gains for both CELSIUS and Alani Nu, with expectations for improved shelf space in convenience channels. Retailers are optimizing cooler space, which could benefit energy drink sales.
• Velocity Considerations: As new products are introduced and distribution expands, initial velocities may be lower, but the focus remains on building consumer habits and frequency of purchase.
• Inventory Management: The team is committed to tightening inventory management to minimize peaks and valleys in sales data, particularly as the integration with Pepsi continues.
• Consumer Trends: Notable shifts in consumer behavior, particularly among female consumers, are seen as opportunities for growth in the energy drink category.

Overall, Celsius Holdings demonstrated strong financial performance in 2025, with a clear strategy for growth and integration, despite facing challenges related to margins and competitive pressures. The outlook for 2026 remains optimistic, with a focus on innovation and operational efficiency.