Energy drink company Celsius (NASDAQ:CELH) missed Wall Street’s revenue expectations in Q2 CY2026, but sales rose 10.6% year on year to $817.9 million. Its non-GAAP profit of $0.36 per share was 13.9% below analysts’ consensus estimates.
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Celsius (CELH) Q2 CY2026 Highlights:
- Revenue: $817.9 million vs analyst estimates of $872 million (10.6% year-on-year growth, 6.2% miss)
- Adjusted EPS: $0.36 vs analyst expectations of $0.42 (13.9% miss)
- Adjusted EBITDA: $184.2 million vs analyst estimates of $198.5 million (22.5% margin, 7.2% miss)
- Operating Margin: 9.2%, down from 19.3% in the same quarter last year
- Market Capitalization: $7.45 billion
Company Overview
With its proprietary MetaPlus formula as the basis for key products, Celsius (NASDAQ:CELH) offers energy drinks that feature natural ingredients to help in fitness and weight management.
Revenue Growth
A company’s long-term sales performance can indicate its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years.
With $3.05 billion in revenue over the past 12 months, Celsius carries some recognizable products but is a mid-sized consumer staples company. Its size could bring disadvantages compared to larger competitors benefiting from better brand awareness and economies of scale. On the bright side, it can still flex high growth rates because it’s working from a smaller revenue base.
As you can see below, Celsius’s sales grew at an incredible 47.4% compounded annual growth rate over the last three years. This shows it had high demand, a useful starting point for our analysis.
This quarter, Celsius’s revenue grew by 10.6% year on year to $817.9 million but fell short of Wall Street’s estimates.
Looking ahead, sell-side analysts expect revenue to grow 12.6% over the next 12 months, a deceleration versus the last three years. Still, this projection is admirable and implies the market sees success for its products.
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Cash Is King
Free cash flow isn’t a prominently featured metric in company financials and earnings releases, but we think it’s telling because it accounts for all operating and capital expenses, making it tough to manipulate. Cash is king.
Celsius has shown robust cash profitability, driven by its attractive business model that enables it to reinvest or return capital to investors. The company’s free cash flow margin averaged 12% over the last two years, quite impressive for a consumer staples business. The divergence from its underwhelming operating margin stems from the add-back of non-cash charges like depreciation and stock-based compensation. GAAP operating profit expenses these line items, but free cash flow does not.
Key Takeaways from Celsius’s Q2 Results
We struggled to find many positives in these results. Its revenue missed and its EBITDA fell short of Wall Street’s estimates. Overall, this was a weaker quarter. The stock traded down 15.9% to $24.52 immediately following the results.
Celsius underperformed this quarter, but does that create an opportunity to invest right now? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).