ZVIA Q4 2025 Earnings Call Summary

1. Key Financial Results and Metrics

Q4 2025 Results:
- Net Sales: $37.9 million, down 4% year-over-year.
- Adjusted EBITDA: Breakeven, significantly improved from a loss of $3.9 million in Q4 2024.
- Gross Margin: 47.7%, a decline from 49.2% in Q4 2024.
- Net Loss: $1.3 million, improved from a loss of $6.8 million in the prior year.
Full Year 2025 Results:
- Net Sales: $161.3 million, up 4% year-over-year.
- Adjusted EBITDA Loss: $4.7 million, improved from a loss of $15.2 million in 2024.
- Gross Margin: 48%, up from 46.4% in 2024.
- Net Loss: $11.1 million, reduced from $23.8 million in 2024.

2. Strategic Updates and Business Highlights

Strategic Pillars:
- Amplified Marketing: Focused on differentiating Zevia as a clean-label alternative to artificial sodas, with campaigns like "ZTOX" promoting healthier choices.
- Product Innovation: Introduced new flavors such as Strawberry Lemon Burst and Orange Creamsicle, which have resonated well with consumers.
- Distribution Expansion: Achieved a nationwide presence in Walmart and increased shelf space in Albertsons, enhancing visibility and trial opportunities.
Leadership Changes: Andy Rubin appointed as Chair of the Board, with a focus on leveraging his experience in corporate strategy and sustainability.

3. Forward Guidance and Outlook

2026 Guidance:
- Estimated Net Sales: $169 million to $173 million (6% growth at midpoint).
- Expected Adjusted EBITDA: Loss of $1 million to a profit of $0.5 million.
- Anticipated Gross Margins: High 40% range starting in Q2 2026.
- Q1 2026 Net Sales Guidance: $40 million to $42 million, driven by the Costco national program.

4. Bad News, Challenges, or Points of Concern

Sales Decline in Q4: The decrease in net sales was attributed to lapping prior year distribution gains at Walmart and a shift in promotional activities.
Gross Margin Pressure: Margins are expected to be impacted in Q1 due to the Costco program's lower margins and anticipated tariff-related costs.
Tariff Costs: An additional $5 million in aluminum tariffs expected to affect profitability starting in Q2.
Discontinuation of Tea Line: This is expected to negatively impact growth by 1-1.5 percentage points.

5. Notable Q&A Insights

Costco Program: The new national rotation at Costco is expected to drive trial in previously underpenetrated regions, with potential for permanent distribution based on performance.
Tariff Mitigation: Price increases and productivity initiatives are being implemented to offset tariff costs.
Marketing Spend: Expected to increase to 12-13% of revenue in 2026, balancing cost savings with brand visibility investments.
Retail Dynamics: Strong performance at Albertsons is seen as a model for expanding distribution with other retailers, contingent on successful resets and shelf placements.

Overall, Zevia demonstrated significant improvements in financial performance and strategic positioning in 2025, despite facing challenges related to sales fluctuations and cost pressures. The company is optimistic about its growth trajectory moving into 2026, supported by marketing and product innovation initiatives.

ZVIA — Zevia PBC

Q4 2025 Earnings Call Summary