Remember that scene in Talladega Nights where the original driver leaves the track and Lucius asks the pit crew if anyone wants to jump in the car and go fast? Well…Celsius Holdings is the energy drinks version of Ricky Bobby! This is only the third quarter that Celsius energy drinks was fully integrated into the PepsiCo DSD distribution system after the August deal announcement. Celsius Holdings (NASDAQ: CELH) had quarterly revenue of $385 million, which was up 104% YoY. According to IRI last 52-week data, Celsius was the number one brand driver of unit and sales growth in the energy drink category. Celsius was responsible for 28% of the category growth, driving $950 million in incremental sales. In addition, according to the trailing 4 weeks of IRI SPINS all tracked channel data for the period ending October 8, 2023, Celsius is now securely the third-largest energy drink brand in the category. Its market share went from 4.4% in the third quarter of last year to 10.5% now. And I don’t want gloss over this accomplishment…because it’s the first time in over a decade that an energy drink not named Red Bull or Monster Energy has had a 10% share in the U.S. market. Celsius energy drinks saw massive growth in convenience stores, foodservice (e.g. fast food restaurants), mass retailers like Walmart, the club channel in retailers like Costco, and the Amazon marketplace. In the quarter, CELSIUS became the best-selling energy drink on Amazon and also number one energy drink brand on Instacart grocery marketplace. So, it’s safe to say that CELSIUS is the official energy drink of the Internet Generation. Additionally, the international expansion groundwork with PepsiCo is getting laid now, so Celsius energy drinks can capture what they believe is a significant opportunity for incremental growth over the next three to five years. Finally, CELSIUS has a household penetration of about 25%, compared to 11.1% a year ago. This makes the energy drink brand the number one growth brand in household penetration. CELSIUS have incurred substantially more in marketing and advertising expenses, but it’s not misaligned with revenue growth. In fact, it’s almost the same with YTD Celsius revenue growth at 104% and the marketing and advertising expenses up 108%. This shows us that marketing strategies (though outsized from years prior) are driving ROI.

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