To what extent will the double-digit price increase on shakes offset input cost inflation, how have retailer discussions progressed, and are similar industry actions expected?

Paul Rode confirmed their double-digit price increase is in line with a major competitor's earlier action and is expected to cover absorbed inflation, allowing for healthier margins and continued investment. Retailer conversations are ongoing, and they are near finalizing the increase, assuming elasticities greater than 1. “The last time we took a price increase on shakes, it will be coming up on 2 years ago. So we really have absorbed inflation really over the last couple of years. And so yes, we do expect that this increase will allow us to get back to healthier margins as well as continue to invest in the business.”

Where are the biggest opportunities for improved execution and how long will it take to achieve them, given the new CEO's focus?

Paul Rode highlighted improving execution in supply plan, demand planning, and system/process improvements, noting the recent reorganization aims to speed up decision-making. Mike Axelrod emphasized supply chain excellence, optimizing procurement, and integrating the supply chain to proactively address inventory issues. “I view it in the context of really supply chain excellence. And so really working with our supply chain partners to really drive to the lowest-cost production and distribution, really optimizing that.”

Details on the targeted regional DSD expansion, including distribution partners, success metrics, and potential materiality over the next 12-24 months.

Paul Rode explained that convenience is a significant white space (10% of RTD category) and new products like 42g Ultimate enable expansion. They are building internal capabilities and plan regional partnerships starting this year, with sales expected in FY27. This doesn't preclude national opportunities, but serves as a starting point for learning. “So first, convenience represents about -- it's a meaningful white space. It's a big opportunity for our business. We have very little sales in convenience today. Overall, the convenience channel for RTDs is about 10% of the category.”

BRBR

BellRing Brands (BRBR) Q3 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q3 FY26)· Consumer Staples· Aug 4, 2026

Source: earnings call transcript

Executive summary

BellRing Brands Q3 FY26 — Strong Sales & Consumption Offset by Margin Pressures

BellRing Brands reported strong Q3 FY26 net sales and consumption, exceeding expectations for both Premier Protein and Dymatize. However, adjusted EBITDA margins were pressured by inventory-related charges and elevated freight costs, leading to a revised full-year outlook. The company is implementing a double-digit price increase for Premier shakes and other initiatives to restore profitability and improve execution, with new CEO Michael Axelrod focusing on supply chain excellence and disciplined investment.

Highlights

Net sales increased 4% in Q3, with both Premier Protein and Dymatize exceeding expectations.
Premier Protein shake volume grew 3% in Q3, with dollar consumption up 6%.
Dymatize net sales were up 27% in Q3, driven by 6% volume growth and 21% price/mix.
Premier Protein household penetration reached almost 23%, with consistently highest repeat rate in category.
Organizational realignment expected to generate $10M-$12M annualized run rate operating expense savings.

Concerns

Adjusted EBITDA margins were below guidance in Q3, reflecting inventory-related headwinds and higher freight costs.
Q3 adjusted gross margin declined to 27.7% from 35.1% a year ago, driven by protein/freight cost inflation and a 180 bps inventory charge.
Full-year adjusted EBITDA outlook includes $28M of unfavorable inventory-related impacts, with $21M recorded in Q2/Q3.
Freight rates have risen sharply, incrementally weighing on second half margins by approximately 140 bps.
Q4 adjusted EBITDA margin expected to be approximately 10%, reflecting seasonal promotions, commodity/freight inflation, and 100 bps inventory actions.

Guidance & targets

Category	Target	Timeline	Confidence
Full-year Net Sales	$2.335 billion to $2.375 billion high materiality	FY26	High
Full-year Adjusted EBITDA	$275 million to $295 million high materiality	FY26	High
Full-year Adjusted EBITDA Margin	approximately 12% high materiality	FY26	High
Q4 Net Sales	flat at the midpoint medium materiality	Q4 · FY26	High
Q4 Premier Protein Sales	up low single digits medium materiality	Q4 · FY26	High
Q4 Premier Shake Consumption	up mid-single digits medium materiality	Q4 · FY26	High
Q4 Dymatize and All Other Sales	down mid-single digits medium materiality	Q4 · FY26	High
Q4 Adjusted EBITDA Margin	approximately 10% high materiality	Q4 · FY26	High
Net Leverage	approximately 4x medium materiality	FY26	High
Premier Shakes Price Increase	double-digit high materiality	Q1 · FY27	High
Powders Price Increase	third round medium materiality	Q1 · FY27	High
Organizational Realignment Annualized Savings	$10 million to $12 million medium materiality	FY27	High

Segment performance

Segment	Revenue	YoY	QoQ	Margin
Premier Protein Sales growth trailed consumption primarily due to e-commerce promotional timing, a greater promotional impact on net sales and retail consumption, and modestly lower trade inventory. Consumption benefited approximately 1 percentage point from a promotional timing shift. Shake volume: up 3%Price/mix: down 2%Dollar consumption: up 6%	increased 1%	1%	—	—
Dymatize Reflected inflation-driven price increases implemented earlier this year. Saw higher consumer demand primarily in e-commerce and international channels and benefited from distribution gains in overseas markets. Volume: up 6%Price/mix: up 21%	up 27%	27%	—	—

Product announcements

Product	Type	Timeline	Details
Premier Protein 42-gram Ultimate Shake	launch	Q4 FY26
Premier Protein Sparkling Soda	launch	Q4 FY26

Capital programs

Organizational realignment completed

Period spend: $5 million charge

Start: late June

Benefit:annualized run rate operating expense savings of $10 million to $12 million

The organizational realignment was announced in late June. A $5 million charge was recorded in Q3 FY26. It is designed to simplify the business, reduce structural costs, and improve execution discipline, with the majority of savings expected in fiscal 2027.

Risks & headwinds

Inventory-related headwinds Q3 FY26, Q4 FY26, FY26

Adjusted EBITDA margins were below our guidance, reflecting inventory-related headwinds. Q3 inventory-related charge was a 180 basis point headwind to gross margin. Full-year adjusted EBITDA outlook includes $28 million of unfavorable inventory-related impacts, $21 million of which have already been recorded in Q2 and Q3. Q4 inventory-related actions expected to be approximately 100 basis points headwind to adjusted EBITDA margin.

Mitigation:Recorded a charge in Q3 on excess bottle shake inventory. Targeted trade spend anticipated in Q4 to support excess bottle inventory sell-through, reflecting a prudent decision to optimize those levels ahead of year-end. Working to strengthen planning capabilities and end-to-end supply chain processes to improve inventory management.

Higher freight costs H2 FY26

Incrementally weighing on second half margins by approximately 140 basis points. Freight rates have risen sharply since May earnings call and are expected to remain elevated.

Mitigation:Incorporated into revised guidance. Expect freight to carry a bit into next year.

Sustained inflationary pressure in key input costs FY26, FY27

Protein and freight cost inflation drove year-over-year decline in adjusted gross margin. Expect whey protein rates to remain elevated throughout next year. Expect milk protein inflation in the mid-single-digit range for FY27.

Mitigation:Announced a double-digit price increase on Premier shakes and additional pricing on powders, both effective in Q1 FY27. These actions are necessary to offset sustained inflationary pressure and support a healthier margin profile.

Highly competitive environment Ongoing

Competition has increased in the attractive, growing category. 70% of RTD shake category volumes were sold on price promotion in Q3.

Mitigation:Focused on restoring a stronger profit trajectory and delivering more consistent results in FY27. Taking decisive actions across pricing, channel mix, productivity, and supply chain capabilities. Investing in advertising, distribution expansion, and innovation.

Cannibalization of bottle business by tetras Q3 FY26

Cannibalization of bottle business by tetras in the e-commerce channel ended up being a bit more than expected, contributing to excess bottle inventory.

Mitigation:Demand team didn't lower demand fast enough; supply team didn't pull down supply fast enough (implying future process improvements). Targeted trade spend in Q4 to sell through excess bottle inventory.

What to watch in Q4 FY26

Premier Protein Shake Pricing Impact

Q1 FY27

Current double-digit price increase announced

Target offset inflation, elasticities >1

Why it matters

Critical for restoring healthier margins and profitability in FY27.

First, we have announced a double-digit price increase on Premier shakes and additional pricing on powders, both effective in our first quarter of fiscal 2027. We believe these actions are necessary to offset sustained inflationary pressure in key input costs and support a healthier margin profile over time. With this price increase, we expect volume-related elasticities to be slightly greater than 1.

Find out whether BRBR delivers this. Inve re-checks your case every morning.

Q&A highlights

Is FY26 a trough in performance and profitability, and where do margins settle in FY27 and beyond, considering ongoing marketing and pricing ability?

Paul Rode stated that FY26 is not the new normal for margins, expecting improvement in FY27 due driven by non-recurring inventory impacts (120 bps headwind in FY26) and initiatives like pricing and productivity. Mike Axelrod added that he needs more time to assess the structural earnings power of the business.

“So we do not see '26, obviously, as our new normal for our margins. In fact, we -- as we said on our prepared remarks, we expect '27, our EBITDA margins will improve.”

asked by Andrew Lazar · answered by Paul Rode

2 min read 5 chapters

Detailed narrative

New CEO's Vision and Focus

Michael Axelrod, in his seventh day as CEO, outlined his focus on improving execution, operations, and speed to market, emphasizing consumer-centricity and strong customer partnerships. He sees significant opportunities to translate category leadership into consistent, profitable growth, particularly through supply chain excellence and disciplined investment. Axelrod plans to spend the coming months listening to employees, customers, and partners to identify improvement areas and empower teams.

Strategic Actions for FY27

The company is taking decisive actions, including a double-digit price increase on Premier shakes and additional pricing on powders, both effective Q1 FY27. These measures are intended to offset sustained inflationary pressure in key input costs and support a healthier margin profile. Management anticipates volume-related elasticities to be slightly greater than 1 following these price increases.

Channel Diversification and Innovation

BellRing is actively diversifying its business across channels, categories, and product segments. They expect meaningful distribution gains in FDM and e-commerce channels in FY27. In convenience, a disciplined regional DSD expansion is underway, targeting core 30-gram shakes and the new 42-gram Premier Protein Ultimate product. The launch of Premier Protein Sparkling Soda further expands into the refreshment category, creating new distribution opportunities.

Productivity and Supply Chain Improvements

Several productivity initiatives, including cost savings programs and an organizational realignment completed in late June, are designed to simplify the business, reduce structural costs, and improve execution discipline. These actions are expected to generate $10M-$12M in annualized operating expense savings, with the majority realized in FY27. Efforts are also focused on strengthening planning capabilities and end-to-end supply chain processes to enhance inventory management.

Category and Brand Health

The protein category maintains healthy fundamentals with strong consumer demand, expecting high single-digit fiscal year growth primarily driven by volume. Premier Protein's household penetration has reached almost 23%, boasting the highest repeat rate in the category. Despite increased competition, 70% of RTD shake volumes were sold on price promotion in Q3, reflecting continued value-seeking behavior and elevated promotional activity during peak seasons.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.