Celsius Holdings shares dropped as much as 18% before the opening bell on Thursday after the company reported second-quarter revenue below what analysts had expected and revealed a decline in sales for its namesake Celsius brand.
For the quarter ending June 30, Celsius Holdings posted revenue of $817.9 million, an 11% increase from the prior-year period that nonetheless fell short of the $872.6 million average analyst estimate, according to Bloomberg
Revenue for the Celsius brand fell approximately 11.7% compared to the same period last year, the company said. Analyst consensus for adjusted earnings per share was 41 cents, according to Bloomberg; the company reported adjusted diluted EPS of 36 cents. The company attributed the Celsius brand decline to increased trade and promotional spending, shipment timing related to inventory rebalancing, softness in the club channel, a planned reduction in new product launches, and SKU optimization efforts tied to the integration of its recent acquisitions.
The company’s gross profit margin narrowed to 48.1% from 51.5% a year earlier, a result the company attributed to elevated promotional and incentive spending relative to revenue as well as shifts in channel mix, the company said. Net income fell 45% to $55.3 million from $99.9 million in the year-earlier period. Results at the company’s other brands were mixed.