Financial Data and Key Metrics Changes - In Q3, the company achieved a net revenue growth of 7%, with international markets contributing approximately 75% of this growth and the U.S. contributing 25% [17][18] - Gross margin reached a record 61.7%, expanding 110 basis points year-over-year, despite an 80 basis point headwind from tariffs [19][20] - Adjusted EBIT margin was 11.8%, with adjusted diluted EPS at $0.34, both exceeding expectations and reflecting a year-to-date growth of approximately 25% [21][28] Business Line Data and Key Metrics Changes - Direct-to-consumer (DTC) sales increased by 9%, with a strong performance in both stores and online, while wholesale net revenues grew by 5% [11][13] - Women's business grew by 12% year-to-date, while men's business saw a solid growth of 5% in Q3 [9][10] - The tops category experienced notable growth, with overall tops up 9% for the quarter and 10% year-to-date [82] Market Data and Key Metrics Changes - The U.S. market grew by 3%, while international business saw a 9% increase, driven by strong performance in Asia [6][14] - In Europe, net revenues were up 3%, with key markets like the U.K. showing high mid-teen growth [22][33] - Asia's net revenues accelerated to a 12% increase, with double-digit growth in both DTC and wholesale channels [22][23] Company Strategy and Development Direction - The company is pivoting to a DTC-first strategy, focusing on becoming a head-to-toe denim lifestyle retailer, which is expected to drive growth [5][7] - Continued investment in impactful marketing campaigns and strategic partnerships is aimed at enhancing brand relevance and expanding market share [6][8] - The company is also focusing on premiumization efforts, with the rollout of the elevated Blue Tab collection [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's momentum, citing a strong product pipeline and effective marketing strategies [6][16] - Despite a complex macro environment, management anticipates continued strong performance and growth opportunities, particularly in international markets [16][28] - The company raised its full-year revenue and EPS guidance, reflecting optimism about future performance [17][27] Other Important Information - The company returned $151 million to shareholders in Q3, marking a 118% increase year-over-year, and declared a dividend of $0.14 per share, up 8% from the previous year [23][24] - Inventory levels were up 12% in dollar terms, driven by investments ahead of the holiday season and higher product costs due to tariffs [24] Q&A Session Summary Question: European momentum and pre-books for next spring - Management noted that Europe grew 3% in Q3, with strong performance in key markets and positive pre-book trends for spring [31][32] Question: Momentum entering the season and demand trends - Management confirmed no material change in demand trends, emphasizing strong underlying business momentum [41][42] Question: Wholesale business growth drivers - Growth in the wholesale channel was primarily driven by existing accounts responding positively to the expanded product pipeline [65][66] Question: Sustainability of low single-digit growth in the Americas - Management expects continued positive growth in DTC, while U.S. wholesale may see a decline due to strong prior year comparisons [70][72] Question: Lifestyle offering growth rates and AUR opportunities - The tops business saw significant growth, with management confident in further expanding this category and improving average unit retail (AUR) [80][84]

Summary of Celsius Holdings Conference Call Company Overview - **Company**: Celsius Holdings Inc. - **Recent Development**: Expanded deal with PepsiCo valued at approximately $585 million [2][6] Key Points from the Conference Call 1. Deal with PepsiCo - **Captaincy Agreement**: Celsius becomes the energy lead within the Pepsi Energy portfolio, allowing for prioritization in distribution and planogram decisions [2][3] - **Distribution Opportunities**: Significant potential for Alani Nu within convenience stores, currently at 65% ACV (All Commodity Volume) [4][5] - **Partnership Strengthening**: New President and COO, Eric Hansen, enhances alignment with Pepsi, including an additional board seat for Pepsi [5][6] 2. Brand Performance and Strategy - **Celsius and Alani Nu**: Both brands are expected to benefit from increased distribution and planogram control, with a focus on high-velocity SKUs [10][12] - **Rockstar Brand**: Aims to stabilize and potentially grow Rockstar, with a focus on consolidating SKUs and leveraging historical brand strengths [20][21] - **Market Share Goals**: Celsius aims for a 20% market share, positioning itself closer to Monster Beverage's 28% share [12][30] 3. Innovation and Product Development - **Innovation Focus**: Plans for limited-time offerings (LTOs) and new product categories, including protein shakes from Alani Nu [22][23] - **SKU Rationalization**: Emphasis on increasing ACV for top-performing SKUs to enhance velocity and market presence [15][16] 4. Market Trends and Category Performance - **Category Growth**: The energy drink category is experiencing double-digit growth, with a shift in consumer preferences from coffee to energy drinks [25][27] - **Consumer Behavior**: Rising coffee prices are driving consumers towards more affordable energy drink options like Celsius [26][27] 5. Financial Outlook and Margins - **Margin Pressures**: Anticipated pressures from aluminum tariffs in Q3 and Q4, with a projected gross margin in the low 50s [29][30] - **Long-term Margin Goals**: Celsius aims to achieve mid-50s gross margins, benchmarking against Monster Beverage [30][31] 6. International Expansion - **Cautious Approach**: Celsius is methodically expanding into international markets, focusing on brand equity and distribution partnerships [35][36] - **Long-term Vision**: Plans for international growth are seen as a 3-5 year play, with potential in health-conscious markets like Scandinavia [36] 7. Investor Insights - **Turnaround Story**: Celsius has stabilized and is poised for growth, with Alani Nu showing triple-digit growth and a strong future outlook [37][38] Additional Important Points - **Food Service Opportunities**: Celsius has seen success in food service, contributing approximately 11-12% of revenue, with Alani Nu expected to tap into this segment [9][18] - **Planogram Resets**: Anticipated resets in major retailers will occur from January to April, impacting distribution strategies [17][18] This summary encapsulates the key insights and strategic directions discussed during the Celsius Holdings conference call, highlighting the company's growth potential and market positioning.

Financial Data and Key Metrics Changes - For Q1 2025, net revenue was $15.4 million, a decline of 24% from $20.2 million in Q1 2024, primarily due to SKU rationalization and reduced consumer demand [7][26] - Adjusted EBITDA loss slightly improved to $2.5 million from $2.6 million year-over-year, despite a 24% sales reduction [7][29] - Gross margin decreased to 61.4% from 65.1% in the previous year, attributed to product mix changes [27] - Operating loss narrowed to $3.7 million from $5.3 million in the year-ago quarter, an improvement of approximately 30% [28][29] - Net loss for Q1 2025 was $3.9 million, improving by approximately 25% from a loss of $5.2 million in Q1 2024 [29] Business Line Data and Key Metrics Changes - The company launched one new product category in Q1 2025, while suspending new product launches from Asia for the year [26] - Launch revenue was $400,000 in both Q1 2025 and Q1 2024 [26] Market Data and Key Metrics Changes - The company experienced softness in consumer demand, particularly in the latter part of the quarter, which was compounded by reduced Amazon traffic due to changes in its affiliate program [7][8] - Inventory levels increased to $18.1 million from $13.7 million at the end of Q4 2024, reflecting a buildup in anticipation of demand for seasonal products [30] Company Strategy and Development Direction - The company is focusing on four strategic initiatives: accelerating manufacturing diversification, expanding into consumables, implementing strategic pricing adjustments, and reducing fixed costs [10][21] - The goal is to manufacture no more than 30% of goods in China by the end of 2025, accelerating the previous target of below 40% by 2026 [12] - The company has paused its share repurchase program to conserve cash amid the current macroeconomic environment [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current volatility without raising equity capital in 2025, despite withdrawing guidance for the year due to uncertainty [19][31] - The company believes that the actions taken now will set the foundation for a return to growth and profitability beyond 2025 [32] - Management acknowledged the challenges posed by the tariff environment but emphasized the importance of agility and resilience in their strategy [9][20] Other Important Information - The company is targeting annualized savings of $5 million to $6 million through fixed cost reduction initiatives, with approximately $4 million expected from headcount reductions [16][25] - Cash preservation remains a priority, with cash levels at approximately $14.3 million as of March 31, 2025 [30] Q&A Session Summary Question: Can you talk about your inventory plans in the near and medium term given the 30% China tariffs? - Management indicated that they have been proactive in managing inventory and have not rushed to bring in products from China, focusing instead on securing stable supply chains [35][36] Question: Can you elaborate on your pricing strategy and consumer reactions? - Management noted that the pricing strategy has led to mixed results, with some products experiencing decreased velocity due to price increases, but overall positioning remains strong [41][42] Question: Is there a way to speed up your diversification strategy in manufacturing? - Management committed to accelerating the diversification strategy as quickly as possible while maintaining product quality [45] Question: Will the company be paying any dividends in the future? - Management stated that cash conservation is a priority due to restructuring plans and the current macroeconomic environment, focusing on long-term growth instead [49] Question: Would management consider revising its policy on granting employee stock options? - Management affirmed that stock options are a tool for incentivizing performance and aligning interests with shareholders, and they will continue to evaluate this policy [52][54]