Celsius Holdings, Inc.

Celsius Holdings, Inc. markets CELSIUS and Alani Nu drinks and owns the Rockstar Energy business in the United States and Canada. It sells through distributors, including PepsiCo, as well as directly to selected customers. Its shares trade on Nasdaq under CELH, and its fiscal year ends December 31.

Quarterly results and the changing brand mix

Rockstar was acquired on August 28, 2025, so the comparative quarter includes only a partial period. The group's 16.8% reported revenue growth includes that change in ownership coverage. Alani Nu was already owned for the full comparative third quarter.

In tracked U.S. retail channels for the 13 weeks ended September 27, 2026, CELSIUS sales fell 7%, Alani Nu rose 57.9% and Rockstar fell 13.2%. These retail measures have different coverage from consolidated company revenue. PepsiCo delivery, promotional allowances, discontinued products and international sales also affect the comparison.

Reported profit benefited from distributor termination expense falling to $3.5 million from $246.7 million. Adjusted EBITDA removes that expense and other items including stock compensation, acquisition and integration costs, reorganization and legal costs. It fell 3.4%, with a 23.4% margin versus 28.4% a year earlier, although the margin improved from 22.5% in the second quarter.

Earlier expectations and the outlook

In August, management expected third-quarter gross margin broadly consistent with the second quarter's 48.1%, in the high 40s at then-current fuel and aluminum prices. September's investor conference added a warning about higher fuel prices. Actual third-quarter margin was 46.8%. Management's longer-term recovery program relies on purchasing, manufacturing, pricing and promotion improvements, with benefits building through 2027 and 2028.

The latest full-year gross-margin expectation remains in the high 40s, subject to commodity costs. Fourth-quarter reported revenue growth is expected to be below the pace in the first nine months. Around $20 million to $25 million of shipments moved into Q3 from Q4; the comparison also includes about $25 million of net inventory-building benefits in Q4 2025. New-product shipments ahead of January launches provide a partial offset.

Management expects CELSIUS to return to growth during 2027. For Alani Nu, it sees the second quarter of 2027 as the cleanest comparison after the transition into PepsiCo's delivery system, with some transition effects remaining in the first quarter. Rockstar's priority remains stabilizing sales after reducing its product range.

Cash generation and financial resources

Operating cash flow in the first nine months was $450.2 million, versus $478.9 million. This already includes cash effects from distributor transitions and the initial $60 million Strong Arm litigation settlement payment. Improved collections and a $171.2 million increase in promotional allowances accrued but not yet paid helped operating cash.

Cash property and equipment spending was $51.2 million, versus $25.5 million. Operating cash after that spending was $399 million, compared with $453.3 million. The cash-flow statement records $167.5 million of share repurchases and $42.4 million of preferred dividends in financing activities; employee tax-withholding repurchases are separate.

Cash and equivalents were $700.6 million at September 30. Borrowings had $693 million of principal outstanding and a $674.7 million carrying value after financing costs, including $6.9 million classified as current. The $100 million revolving credit facility was undrawn.

PepsiCo also holds convertible preferred shares, with dividend and participation rights separate from the ordinary term-loan debt. Those rights explain why income attributable to common shareholders is below consolidated net income.

Completed acquisitions and distribution changes

Celsius completed the Alani Nu acquisition on April 1, 2025. Final acquisition-date consideration was $2.056 billion, comprising $1.322 billion of cash, $722 million of shares and $11.2 million of contingent consideration at its initial fair value. The contingent payment ultimately reached $25 million and was paid in the first quarter of 2026.

The U.S. and Canadian Rockstar acquisition closed on August 28, 2025, alongside expanded PepsiCo distribution arrangements. The transaction involved new convertible preferred shares and changes to existing preferred terms. Its accounting allocated $337 million to the acquired business before working-capital cash received, with a separate $598.8 million noncash upfront customer payment for the distribution arrangement. The resulting net Rockstar purchase consideration was $307.6 million.

The separate distribution asset is amortized as a reduction of revenue. PepsiCo's reimbursements for terminating former distributors were restricted to those obligations and recorded as deferred revenue; the original $275 million and the additional $81.1 million received in 2026 had been fully used by September 30.

Brand leadership and developments to follow

On November 5, Celsius announced three U.S. business units: CELSIUS, Alani Nu, and Rockstar Energy and Emerging Growth. Alex Zigliara was appointed CELSIUS president; Rishi Daing moves from chief marketing officer to lead Rockstar and Emerging Growth. An Alani Nu president is being recruited. International operations retain their existing structure.

The next results will show how fourth-quarter shipment timing, new-product launches and commodity costs interact. Longer-term tests are CELSIUS returning to growth, Alani Nu's distribution expansion translating into profit, and the margin benefits of coordinating the larger portfolio.