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John Fieldly (Chief Executive Officer)
Before getting into the highlights of our business, I want to thank our employees, our retail and distribution partners and our loyal consumers for their commitment and belief in what we’re building. Their energy continues to drive ours. In August, we announced an important expansion of our long term partnership with PepsiCo, a milestone that deepens our collaboration and establishes Celsius Holdings as PepsiCo’s U.S. strategic energy drink Captain. This new role gives Celsius a leadership position within PepsiCo’s energy portfolio and greater control over the distribution of our leading portfolio of brands including Celsius, Alani Nu and now Rockstar Energy. With the expanded partnership, we’re further increasing our ability to shape planograms, prioritize SKUs, align promotional periods and bring a unified commercial strategy to life across channels. In short, we’re helping lead how energy shows up in retail for the consumer from the aisle to the checkout cooler and everywhere in between. As part of the same transaction, a large portion of the US Alani Nu based DSD network is joining the PepsiCo distribution network starting December 1, 2025, a move that over time is expected to expand Alani Nu’s reach and accelerate its growth trajectory. For Celsius Holdings, this is a meaningful near term catalyst and we intend to execute the transition with the same efficiency that made our original celsius integration into PepsiCo’s leading distribution system a success. We also acquired the Rockstar Energy brand the US and Canada at the end of August, adding one of the most recognizable brands in energy to our total energy portfolio. Rockstar extends our reach into new consumer segments and strengthens our ability to serve a broader spectrum of energy consumers from fitness to lifestyle to culture and music. Together, we believe that these steps Category Accountancy, Alani Nu’s, expanded distribution and the Rockstar acquisition represent a meaningful advancement for our company. It gives us greater scale, control and the platform to compete from a position of strength. Importantly, this also comes with an endorsement of PepsiCo’s increased ownership stake in Celsius Holdings and an additional board representation, a vote of confidence and our shared long term trajectory. In the third quarter of 2025, our combined portfolio represented more than 20% share of the U.S. energy drink market in track channels and grew 31% year over year, according to Nielsen, nearly twice as fast as the overall energy drink category. Only two years ago, Celsius Holdings was celebrating after surpassing a 10% share with the Celsius brand alone. Now, through both organic growth and strategic expansion, we’ve doubled the share position with our total energy portfolio. It’s a remarkable achievement that validates the power of our brands and our disciplined execution. Over the last 52 weeks, our portfolio generated more than 5 billion in retail sales in U.S. track channels, according to Nielsen. That success is supported by strong retailer partnerships and consistent consumer demand for functional, great tasting modern energy innovation across major retail and convenience partners. We continue to expand our space and distribution, winning new displays at Target end caps at Walgreens and CVS and achieving double digit growth in unit sales across Walmart, Circle K and Dollar General, just to name a few. In Walmart alone, Celsius Holdings portfolio gained more than two share points year over year and Aulani recorded its best ever sales week in August. Led by Witch’s Brew, the Celsius brand achieved double digit retail sales growth in the third quarter of 2025 at a 13% year over year. Lonnie New grew triple digits at 115% year over year and Rockstar began selling under our ownership. Together these brands are defining what a modern energy company looks like Inclusive, functional, culturally relevant and growing. Marketing and culture continue to drive how we Win Seasonal flavor offerings once again delivered strong results with Alani Nu’s which is Brew notching record sales, reinforcing the power of flavor and innovation to excite consumers and drive velocity. In October we launched our first Celsius limited time offering Spritz Vibe and we are seeing strong consumer response from US and Canada retailers. Our Celsius Live Fit Go campaign continues to strengthen awareness, trial and repeat purchase for our core brand, connecting performance energy through an inspirational lifestyle and we’re extending the same storytelling across the entire portfolio, ensuring each brand stands for something clear and inspirational. Celsius Fitness and Lifestyle Performance Celsius Essentials High Performance Energy Alani Nu Female Focused Lifestyle Energy and Rockstar Energy: Culture and Music Next Generation Energy Last week I and along with several of our leaders had the opportunity to speak directly to 30,000 PepsiCo employees at one of their national town halls. We showcased our total portfolio approach and shared how Celsius Holdings has become the energy partner capable of powering every consumer occasion. Our goal in the conversation was simple to inspire 30,000 teammates across PepsiCo to rally behind our portfolio and help us win in the category. Together at the national association of Convenience Stores Trade show in mid October, we’ve spent time on the floor meeting with retailers. The excitement around our new portfolio was incredible. You could feel the confidence building for our growth in 2026. We believe that the message from consumers was clear. Celsius Holdings continues to be the growth engine of the energy category and retailers want to partner with us to share in the opportunities that lie ahead. We’re also proud of how we continue to invest in our people and culture. Our annual Celsius University Summit brought more together more than 200 of our student marketing ambassadors from across the US and Canada, the next generation of marketers who are helping us stay culturally connected to our consumers. It’s one of the many ways we build brand advocacy from the inside out. As our business grows, so does the depth of our leadership team. We’ve recently welcomed Rishi Dang as Chief Marketing Officer, who brings more than two decades of global marketing commercial leadership experience, including senior roles at PepsiCo and Marc Anthony Brands. We also had two other important leadership appointments, including Garrett Quigley as President, Celsius International and Gary Shipravad as Chief Human Resource Officer. Each brings valuable experience that complements the strong bench already leading the company. Our approach remains team first, execution driven, focused on empowering our people and integrating new expertise, while at the same time maintaining the entrepreneurial energy that defines Celsius across the organization. We’re executing with focus, advancing Aulani news integration, capturing early synergies, onboarding Rockstar and preparing for what we believe will be an even stronger 2026. The third quarter was another step in a series of transformational moves for our global functional beverage portfolio future. We’re now operating at true scale in the US and we’re currently beginning to build that same foundation internationally. In markets like Australia, performance has continued to exceed our expectations. In the uk, we’ve learned valuable lessons that will make us even stronger as we enter 2026, refreshing the Celsius Fizz Free line and incorporating new limited time offers into Celsius brand portfolio, starting with Spritz Buy, which has now launched in the us, Canada and the Nordics. Aulani’s highly successful Witch’s Brew proved again in the third quarter that limited time offers that create consumer excitement also can lift the whole trademark around them. This week, another Alani fan favorite Winter Wonderland returns for the holidays and we have more great innovation in store for 2026 that I’m excited to share with you soon. We’re optimizing our Rockstar Energy portfolio with a medium term goal of stabilizing the brand and recapturing the magic that makes Rockstar an iconic and powerful force to grow the next generation of energy drink consumers. We’ve entered a new era for Celsius Holdings in 2025, one defined by scale, partnership and purposeful growth. We’re building a portfolio that reaches more consumers during more occasions and we’re doing it with discipline, collaboration and a commitment to organizational excellence. I look forward to what’s ahead in 2026 and beyond. I’ll now turn the call over to Jared to discuss third quarter financial results. Jared
Jarrod Langhans (Chief Financial Officer)
thank you John and good morning everyone. Turning to the financials for the quarter ended September 30, 2025, consolidated revenue was approximately $725 million, up 173% from a year ago. The Celsius brand’s third quarter 2025 US scanner growth rate was 13%, driven by favorable product mix and increases in total distribution points. A number of factors can cause the scanner data to vary from reported results such as promotions and incentives to and the success of such programs, timing of acquisitions and timing of customer orders, which can vary from time to time based on various inventory builds for promotions, cash management programs, limited time offering programs, as well as a number of other factors. The difference between the 44% revenue growth rate at the Celsius brand versus the US scanner growth rate of 13% was primarily driven by year over year inventory movements across the company’s customer base, including a net benefit relative to the inventory optimization program with our largest distributor in the prior year quarter as well as increased promotional activity and our international expansion. Aulani New revenue nearly doubled, up 99%, driven by strong limited time offerings, particularly Witch’s Brew which delivered record sell through as well as organic core SKU growth. Rockstar energy contributed roughly $11 million in revenue in its first month under Celsius ownership. An additional portion of Rockstar sales, roughly $7 million was recorded in other income due to GAAP accounting. Combined, the total impact from Rockstar Energy was about $18 million in Q3. We expect this accounting treatment to continue through Q4 before normalizing in 2026. Year to date, consolidated sales are up roughly 75% or $770 million with with Alani Nu accounting for the majority of that growth and Celsius up 12% through the first nine months of the year. Gross margin for the quarter was 51.3% compared with 46% a year ago. Year to date gross margin was 51.6%, up from 50.2% last year. The improvement reflects the lapping benefits of the prior year inventory optimization, lower net portfolio promotional spending pack mix, favorable channel mix and scale benefits on raw materials from higher volume, partially offset by tariffs and the impact of Aulani Neu and Rockstar Energy’s lower margin profiles. We expect to improve Rockstar Energy margins over time starting in the first half of 2026 as we integrate sourcing and production much like the progress we’ve seen with Aulani New since its acquisition. Sales and marketing expenses were elevated reflecting continued investment behind brand building, including the Celsius Live Fit Go campaign. Sales and marketing represented about 20% of sales consistent with our reinvestment strategy. In connection with Aulani news transition into Pepsi’s DSD network, we recorded approximately $247 million in distributor termination expenses during the quarter. These costs are fully funded by PepsiCo under our long term agreement and while they are recognized in our P and L under gaap, the reimbursements are deferred on the balance sheet and amortized into gross sales over the life of the distribution agreement, making the transactions cash neutral to Celsius holdings. General and administrative expenses remained well controlled at approximately 6% of sales excluding acquisition costs, down from 9% last year, reflecting efficiency initiatives and cost discipline. Operating income benefited from higher margins and overhead efficiency, partially offset by marketing and integration investments. We ended the quarter with a strong balance sheet and cash position giving us flexibility to fund future growth and integration initiatives. Shortly after quarter end, we reduced debt by $200 million and reduced our term note by 75 basis points, bringing total debt to roughly $700 million and reducing our annual interest rate expense by approximately $20 million. Beginning in 2026, our near term priorities remain unchanged, continue investing in brand growth, capture synergies from our acquisitions and further strengthen the balance sheet through debt reduction and disciplined capital allocation. As Aulani begins distribution in the US Pepsi system in December, most of the financial benefit is expected to be realized in Q1 2026 due to a phase load in approach ramping from Q4 into Q1 as retailers reset and inventory builds across the Pepsi network. Looking ahead, we expect continued growth in both Celsius and Aulani Nu with a focus on stabilizing Rockstar Energy as we optimize the product assortment and re establish the identity that makes that brand so relatable to consumers. We anticipate Q4 will be a noisy quarter reflecting year end timing effects from promotions, integration activities and cash management from our largest customers along with some incremental freight and tariff pressure. We are looking at the potential for more pressure on our gross margins in Q4 2025 relative to the prior three ...
