Summary of Jones Soda (JSDA) 2025 Conference Call Company Overview - **Company**: Jones Soda - **Location**: Seattle, Washington - **Founded**: 1987, approaching thirty years in business - **Categories**: Core, Modern, and Adult beverages [1][2] Strategic Vision and Mission - **Mission**: Redefine craft beverages with a multi-category portfolio including nostalgic sodas, prebiotics, and adult beverages [6] - **Strategic Focus**: Transition from a singular craft soda focus to a diversified beverage company, targeting high-growth segments like reduced sugar and THC-infused drinks [4][5] Market Trends and Opportunities - **Modern Soda Growth**: Expected to grow from $700 million in 2024 to $2 billion by 2029, driven by health-conscious consumers seeking alternatives to traditional sodas [15] - **Adult Beverages**: Anticipated growth in the adult beverage market, with projections indicating that by 2027, 1 out of every 5 dollars spent on alcohol will go to alternative adult beverages [16][17] - **Consumer Shift**: Notable decline in beer and wine sales, with consumers seeking flavorful alternatives [10][17] Product Innovations - **Core Soda**: Focus on health-conscious options, including zero-sugar variants and strategic partnerships (e.g., Nuka Cola collaboration) [11][12] - **Modern Soda**: Introduction of Pop Jones and Fiesta, targeting the convenience market with innovative flavors and packaging [12][13] - **Adult Beverages**: Launch of Spike Jones, a hard craft soda, and THC-infused products to cater to changing consumer preferences [16][18] Financial Performance - **Sales Trends**: Sales rebounded to over $19 million after a decline to less than $17 million in 2022, but significant EBITDA losses were noted due to high innovation spending [21][22] - **Gross Margin Goals**: Aiming to improve gross margins from 21% to the 30s, with a focus on cost control and operational efficiency [21][23] Management and Leadership - **New Leadership**: CEO Scott Harvey and CFO Brian Mills have been focusing on restructuring and cost control since joining the company [3][25] - **Board of Directors**: Comprised of experienced individuals from major CPG companies, providing strategic guidance and support [26][29] Distribution Strategy - **Expansion Plans**: Targeting growth in convenience stores and club channels, with successful launches in Costco and Circle K [12][20] - **Direct-to-Consumer**: Products available through Amazon and the company’s website, enhancing accessibility [20] Marketing and Brand Strategy - **Consumer Engagement**: Plans to leverage digital marketing and brand ambassadors to enhance consumer interaction and brand visibility [46][48] - **Market Positioning**: Acknowledgment of the competitive landscape with emerging brands, emphasizing the need for differentiation [49][50] Conclusion - **Future Outlook**: Jones Soda is positioned to evolve into a multi-category beverage company, focusing on innovation, consumer trends, and strategic partnerships to drive growth [30][31]

Market Trends & Industry Dynamics - Constellation Brands (STC) blames lower demand from Hispanic consumers for its underperformance [1] - The beer industry is facing significant challenges, including tariffs and changing consumer preferences [3] - Molson Coors is a decent company [3] - The rise of cannabis and GLP-1 drugs adds further pressure on the beer market [4] Valuation & Financial Performance - Molson Coors is valued at nine times earnings [2] - Constellation Brands is valued at 12 times earnings [2] - Molson Coors has a valuation of 99 billion [2] - Constellation Brands has a valuation of 26 billion [2] - Molson Coors sells at nine times at 37% [3] Investment Opportunities & Potential Risks - It's possible to argue that STC should be at half of its current valuation [3] - Concerns exist about Constellation Brands' valuation and its ability to maintain its current level [3] - Doubts are raised about the wisdom of investing in Constellation Brands, even if Berkshire Hathaway did [4]

Core Insights - Shock Top and Auntie Anne's have launched a collaborative campaign titled "Beer Kneads Pretzels" to celebrate the pairing of beer and pretzels through various promotional activities [1][3][4] Group 1: Campaign Details - The campaign includes an exclusive sweepstakes offering $300 Auntie Anne's gift cards and co-branded merchandise to three winners [4] - Each 6-pack of Shock Top Twisted Pretzel Wheat includes a promo code for $6 off a $12 purchase at Auntie Anne's, valid through December 2025 or until supplies last [5][6] - Limited-edition merchandise such as sweatshirts and sling bags will be available through social media giveaways [6] Group 2: Product Information - Shock Top's Twisted Pretzel Wheat is recognized for its pretzel aroma and smooth finish, ranking as the 14 new craft beer release in 2024 [3] - Auntie Anne's has over 2,000 locations across 49 states and 25 countries, known for its hand-rolled soft pretzels since 1988 [9] Group 3: Marketing Strategy - The partnership will leverage a multi-faceted social media campaign to engage consumers, including behind-the-scenes content and opportunities for fans to share their experiences [6][7] - The campaign aims to enhance brand visibility and consumer engagement through interactive promotions and exclusive offers [1][6]

Market Position - Vita Coco 在向健康人群销售椰子水方面表现出色，甚至超越了可口可乐和百事可乐等竞争对手 [1] Challenges - Vita Coco 面临着特朗普政府关税冲击的考验 [1]

Company Overview - Celsius has announced a positive transaction with PepsiCo, marking a significant development for the company [1] - The CEO highlighted the excitement surrounding Celsius and the overall energy category, which has shown improvement compared to the previous year [2] Industry Insights - The energy category experienced negative growth last year but stabilized in Q4, with a return to double-digit growth rates in Q1 and Q2 of this year [2] - Celsius currently holds approximately 10% to 11% market share within its portfolio [2] Marketing Initiatives - The company is investing in the "LIVE. FIT. GO." campaign, which includes programming and advertising efforts, particularly around the NFL for the first time [3]

Core Viewpoint - Elliott Investment Management has acquired a $4 billion stake in PepsiCo, aiming to increase the company's stock price by 50% through strategic changes [1][2][6]. Group 1: Investment and Stake - Elliott's investment makes it one of PepsiCo's largest shareholders, contributing to a 6% increase in the company's stock price [1]. - The current stock price of PepsiCo is $151.43, reflecting a recent increase of 1.9% [1]. Group 2: Strategic Plans - Elliott's letter to PepsiCo's board outlines plans to refranchise bottling operations and potentially eliminate under-performing brands [2]. - The activist hedge fund emphasizes the need for PepsiCo to sharpen focus, drive innovation, and enhance efficiency to unlock shareholder value [4]. Group 3: Market Position and Challenges - PepsiCo's soda segment has fallen to fourth place in U.S. sales volume, trailing behind Coca-Cola, Dr Pepper, and Sprite [4]. - The food business, which constitutes 60% of PepsiCo's revenues, is facing pressure due to slowing sales growth and rising costs [7][11]. - The company's market value has decreased to approximately $200 billion, a 25% decline from its peak of $270 billion in May 2023 [11]. Group 4: Historical Context and Comparisons - Previous activist efforts, such as those by Nelson Peltz's Trian Fund Management, have attempted to influence PepsiCo's strategy without success [8]. - Coca-Cola's successful restructuring in 2017 serves as a benchmark for potential changes at PepsiCo, with Coca-Cola's market value now nearing $300 billion [12].

Core Viewpoint - Constellation Brands has lowered its full-year sales and profit outlook due to declining demand from Hispanic consumers, who represent a significant portion of its business [1][2]. Sales and Profit Outlook - The company now expects net sales of beer to decline between 2% and 4% in its fiscal 2026, a shift from a previous forecast of up to a 3% increase [7][9]. - Adjusted earnings per share are now projected to be between $11.30 and $11.60, down from an earlier forecast of $12.60 to $12.90 [7]. Consumer Behavior - Constellation's President and CEO Bill Newlands noted that U.S. purchases of high-end beers have decreased, with consumers making fewer trips to buy beer and spending less per trip [1][6]. - The trend of reduced spending is particularly pronounced among Hispanic consumers, who account for about half of Constellation's business [2][6]. Market Context - The company has been licensed to sell Modelo and Corona in the U.S. since 2013, following AB InBev's acquisition of Grupo Modelo [3]. - Concerns among Hispanic consumers include rising prices for food and essentials, immigration issues, and job market stability, which have contributed to reduced spending on various categories, including beer [5][6]. Stock Performance - Following the announcement of the revised outlook, Constellation's shares fell more than 7% in afternoon trading [8].

Financial Data and Key Metrics Changes - The company reported record revenues and profits, including gross profits and EBITDA in the second quarter [5] - The energy category has shown a recovery with a growth rate of 17% to 18% year-over-year [24][25] - The company has a 20% market share in the energy category, positioning it strongly against competitors [57][81] Business Line Data and Key Metrics Changes - The Celsius portfolio has seen significant growth, with a market share of approximately 10-11% [2] - The acquisition of Elani Nu, a female-focused brand, is expected to enhance the company's offerings and market reach [3][4] - Rockstar Energy is being integrated into the company's portfolio, with plans to optimize and stabilize its performance [46][50] Market Data and Key Metrics Changes - The energy drink category is experiencing a shift, with more consumers transitioning from coffee to energy drinks [26][31] - The company is seeing an increase in female consumers driving growth in the energy drink category [38] - The convenience channel is identified as a significant opportunity for growth, particularly for the Elani brand [34][36] Company Strategy and Development Direction - The partnership with PepsiCo is a strategic move to enhance distribution capabilities and market presence [6][9] - The company aims to optimize its product placement and availability in retail environments to drive sales [10][12] - A total energy approach is being adopted, targeting different consumer segments with distinct brand identities [18][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the energy category's resilience despite economic challenges in other sectors [27][28] - The integration of Elani and Rockstar is expected to provide additional growth opportunities and enhance operational efficiencies [66][70] - The company is focused on building a strong portfolio that aligns with health and wellness trends in consumer preferences [82] Other Important Information - The company is enhancing its marketing and merchandising teams to better execute its strategies within the Pepsi distribution network [64][65] - The transition to PepsiCo's distribution system is anticipated to be smooth, leveraging past experiences with similar transitions [72][75] Q&A Session Summary Question: What does the agreement with Pepsi mean for Celsius' long-term strategy? - The partnership is critical for distribution and product placement, allowing the company to compete effectively in a highly competitive energy category [9] Question: How does the acquisition of Elani Nu impact the company's market reach? - The acquisition is expected to broaden distribution and enhance the company's ability to serve a diverse consumer base [33] Question: What are the expected financial impacts of the deal with Pepsi? - The deal is anticipated to accelerate growth and improve operational efficiencies, although specific numbers were not disclosed [66][69]

Financial Data and Key Metrics Changes - The company reported record revenues, profits, gross profits, and EBITDA in the second quarter [3] - The energy category has stabilized and is now experiencing double-digit growth rates, with Celsius holding approximately a 10-11% market share [1][3] Business Line Data and Key Metrics Changes - The acquisition of Alani Nu, a female-focused brand, has been integrated into the Celsius portfolio, which is expected to enhance growth [2][3] - The partnership with PepsiCo allows Celsius to control planograms and optimize SKU placements, which is anticipated to drive efficiencies and revenue [7][8] Market Data and Key Metrics Changes - The energy drink category has seen a year-over-year growth of 17-18% in the last four weeks, with brands like Red Bull and Monster performing well [15] - The transition from coffee beverages to energy drinks is noted, indicating a shift in consumer preferences [16][19] Company Strategy and Development Direction - The long-term strategy focuses on strategic partnerships for distribution, particularly with PepsiCo, to enhance market presence and product placement [4][5] - The company aims to leverage its portfolio of brands (Celsius, Alani Nu, Rockstar) to target different consumer segments and maximize market opportunities [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the energy category's robustness and the company's ability to adapt to changing consumer behaviors [15][17] - The integration of Alani Nu and the acquisition of Rockstar are seen as pivotal for future growth, with expectations of enhanced distribution capabilities through PepsiCo [23][54] Other Important Information - The company is preparing for the largest convenience store show in the country, which will help set planograms for the upcoming year [27] - The partnership with PepsiCo includes a significant equity investment and an additional board seat, reflecting confidence in Celsius's growth potential [52] Q&A Session Summary Question: What does the agreement with Pepsi mean for Celsius' long-term strategy? - The agreement enhances distribution capabilities and allows for better product placement, which is critical in the competitive energy category [4] Question: How does the acquisition of Alani Nu change the ability to service energy consumers? - The acquisition allows for a total energy approach, targeting different consumer segments effectively [11] Question: What is the expected financial impact of the deal with PepsiCo? - The deal is expected to bring in approximately $250 million of incremental revenue and enhance operational efficiencies [54] Question: How is the transition of Alani Nu to PepsiCo being managed? - The transition is anticipated to be seamless, with a focus on communication and project management to mitigate disruptions [60][62] Question: What does success look like for Celsius in the next two to three years? - Success is defined by a strong portfolio presence in the energy category, aiming for continued growth and market share expansion [65]

Financial Data and Key Metrics Changes - The energy category has stabilized and is experiencing double-digit growth rates, with Celsius showing significant growth and a market share of approximately 10-11% [2][5][26] - Record revenues and profits were achieved in the second quarter, with gross profits and EBITDA also reaching new highs [5][72] Business Line Data and Key Metrics Changes - The acquisition of Elani Nu, a female-focused brand, is expected to enhance the Celsius portfolio and has been integrated since April 1 [3][5][40] - The partnership with Pepsi has positioned Celsius as a category captain in the energy drink sector, allowing for better product placement and stock availability [6][10][12] Market Data and Key Metrics Changes - The energy drink category has seen a year-over-year growth of 17-18%, with brands like Red Bull and Monster continuing to perform well [25][26] - The shift in consumer behavior indicates a transition from coffee to energy drinks, with larger formats becoming more popular among consumers [29][33] Company Strategy and Development Direction - The long-term strategy focuses on strengthening distribution partnerships, particularly with Pepsi, to enhance market presence and product availability [9][10][67] - The company aims to optimize its brand portfolio, including Rockstar, Elani, and Celsius, to cater to diverse consumer segments and drive daily consumption [52][63][85] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the energy category's robustness and the company's ability to leverage its partnership with Pepsi for future growth [25][67] - The integration of Elani and Rockstar is seen as a significant opportunity to enhance market reach and brand performance [36][40][72] Other Important Information - The company is restructuring its teams to focus on convenience, food service, and mass distribution, enhancing its operational capabilities [68][79] - The transition to Pepsi's distribution network is anticipated to be smooth, with a focus on communication and project management to mitigate disruptions [76][80] Q&A Session Summary Question: What does the agreement with Pepsi mean for Celsius' long-term strategy? - The partnership is critical for distribution, allowing better product placement and stock management in a competitive market [9] Question: How does the acquisition of Elani Nu change the ability to service energy consumers? - It provides a modern energy approach, targeting different consumer segments effectively [18] Question: What is the expected financial impact of the deal with Pepsi? - The deal is expected to enhance revenue and operational efficiency, with Rockstar contributing approximately $250 million in incremental revenue [71][72] Question: How is the transition to Pepsi's distribution network being managed? - The company has established processes and a larger key accounts team to ensure a seamless transition [79][80] Question: What does success look like for Celsius in the next two to three years? - Success involves building a strong portfolio with significant market share in the energy category, leveraging Pepsi's distribution capabilities [85]