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Celsius Holdings, Inc. (CELH)·Q1 2025 Earnings Summary
Executive Summary
- Q1 2025 revenue of $329.3M declined 7% year over year and missed S&P Global consensus ($342.3M), driven by timing/structure of U.S. distributor incentives, elevated retail promotional allowances, and lapping the ESSENTIALS launch; gross margin expanded to 52.3% and beat consensus (49.6%), supported by sourcing efficiencies .
- GAAP diluted EPS was $0.15; non-GAAP adjusted EPS was $0.18 vs S&P consensus $0.191; adjusted EBITDA was $69.7M (21.2% margin) .
- Alani Nu acquisition closed April 1, adding a second billion-dollar brand; combined portfolio captured 16.2% U.S. category dollar share in Q1 (CELSIUS 10.9%, Alani 5.3%) .
- Management reiterated a ~50% FY25 gross margin for the core business and flagged H1 promotional allowance pressure flipping positive in H2; Q2 will reflect Alani purchase accounting (inventory step-up, higher D&A) and a modeling call is planned to detail pro forma impacts .
What Went Well and What Went Wrong
What Went Well
- Gross margin expanded 110 bps to 52.3% on sourcing efficiencies in raw and packaging materials .
- International revenue grew 41% to $22.8M, with momentum in UK, Ireland, France, Australia and New Zealand; excluding 2024 launches, international grew 9% .
- Management added operational leadership (President/COO), fully integrated the Big Beverages facility, and highlighted strong foodservice expansion (Home Depot, Subway) with foodservice ~13.4% of NA sales through PepsiCo; “We are confident in our strategy… well positioned to lead the modern energy category” .
What Went Wrong
- North America revenue fell 10% and total revenue declined 7% YoY, reflecting early-quarter velocity softness, timing/structure of distributor incentives, and heavier retail promotion weighting later in Q1; lapping major Q1 2024 activations and ESSENTIALS launch compounded pressure .
- EPS declined year over year (GAAP $0.15 vs $0.27; adjusted $0.18 vs $0.27) as SG&A increased 22% on acquisition-related professional services and global headcount investments .
- Retail scanner trends showed CELSIUS retail sales down 3% YoY while allowances created “a couple points” headwind; Costco noise from MVM timing and payment timing affected working capital metrics .
Financial Results
Headline Metrics vs Prior Periods
Segment Revenue Breakdown
KPIs and Market Data
Actual vs S&P Global Consensus (Q1 2025) — Values retrieved from S&P Global
Guidance Changes
Earnings Call Themes & Trends
Management Commentary
- “We saw business fundamentals strengthen through the quarter and are encouraged by the positive momentum heading into Q2… we are confident in our strategy and believe that we are well positioned to lead the modern energy category.” — John Fieldly, CEO .
- “We kind of pegged 50% for the year [gross margin]… in the short term looking out at Q2, we see still strong gross profit numbers.” — Jarrod Langhans, CFO .
- “According to Circana, our average items selling per store within the Celsius brand family increased by 4.1 items in MULO+ w/C during the first quarter.” — CEO .
- “We expanded into more than 1,800 Home Depot locations… began rolling out Celsius in 18,000 Subway locations nationwide.” — CEO .
Q&A Highlights
- Velocity and allowance phasing: Management expects “a couple of points” allowance pressure in Q1–Q2 flipping to benefit in Q3–Q4; depletions in DSD were stable, with non-DSD timing noise around club Q4/Q1 .
- Pricing strategy: Taken in Q4’24; cautious approach given consumer trade-up to multipacks and promo-seeking; pricing provides flexibility to support promotions .
- Shelf space and visibility: Focus on additional placements, especially checkout coolers; co-branded cooler opportunities with Alani where space is constrained .
- Costco dynamics: Scanner data up; MVM led to pipe-fill timing and working capital nuances; no distribution loss .
- Alani synergy: Minimal cannibalization (~15% crossover); opportunity to leverage distribution, Amazon, restaurants, and on-premise .
Estimates Context — Values retrieved from S&P Global
- Revenue missed ($329.3M actual vs $342.3M consensus); EPS modest miss (GAAP $0.15; adjusted $0.18 vs Primary EPS consensus $0.191). Gross margin surprise positive (52.3% vs 49.64% consensus), indicating cost-control and sourcing benefits despite top-line pressure .
- Estimate revision risk: Near term, H1 allowance pressure and Q2 Alani inventory step-up may cap EPS; H2 phasing and category momentum could drive revisions higher on margins and volume as shelf resets and multipacks scale .
Key Takeaways for Investors
- The quarter was a classic “quality vs quantity” print: top-line soft and below consensus, but a notable gross margin beat underscores sourcing/operations strength .
- H1 headwinds are largely timing-related (allowances/incentives) and lapping tough Q1’24 comps; management points to improving velocity exiting Q1 and easier comps from June forward .
- International and foodservice are emerging second engines; 41% international growth and deeper foodservice penetration diversify revenue and smooth DSD timing variability .
- Alani adds scale, female consumer penetration, and category share; expect Q2 purchase accounting noise but medium-term synergy tailwinds (cost and distribution) .
- Watch shelf resets and cooler visibility metrics (items per store +4.1) as leading indicators of velocity recovery into summer .
- Near-term trading: Revenue miss vs margin beat likely creates debate; H2 phasing and category share gains could be catalysts if sell-through trends inflect and promo pressure abates .
- Medium-term thesis: A scaled, sugar-free functional platform (CELSIUS + Alani) levered to better-for-you trends, with improving vertical integration and international runway.
S&P Global consensus data used for “Actual vs Consensus” and “Estimates Context.”