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    MNST
    Earnings call· Mar 2026(Q1 FY26)

    Monster Beverage Q1 FY26 earnings call MNST

    May 7, 2026 Source

    Executive summary

    Monster Beverage Q1 FY26 — Record Net Sales and Strong Global Growth

    Monster Beverage achieved record first-quarter net sales, surpassing $2 billion, driven by robust double-digit growth across all global regions and strong innovation. Despite gross margin pressures from geographic mix and input costs, the company maintained pricing power and saw healthy category expansion, particularly in international markets. Management remains confident in its brand portfolio and strategic initiatives for sustained growth, including new product launches and digital transformation efforts.

    Highlights

    5

    • Net sales crossed $2 billion for the first time in a fiscal first quarter, reaching $2.35 billion, up 26.9% year-over-year.

    • Achieved double-digit sales growth across all geographic regions, with international sales increasing 44.9% to $1.06 billion.

    • Gained share in many global markets, including Monster Energy becoming the fastest-growing FMCG brand by value in EMEA and market leader in Australia.

    • U.S. net sales increased 15.6% in Q1 FY26, driven by strong core product performance and innovation.

    • Adjusted diluted EPS increased 23.7% to $0.58 from $0.47 in the prior year.

    Concerns

    5

    • Gross profit margin decreased to 55.0% from 56.5% year-over-year, primarily due to geographical sales mix and increased aluminum can and freight-in costs.

    • Geographic mix had an approximate 120 basis points adverse impact on gross margin in Q1 FY26.

    • The Alcohol Brands segment net sales decreased 5.9% to $32.7 million.

    • Aluminum headwinds in Q1 FY26 impacted margin by just under 1%, with modest sequential cost increases expected through year-end 2026.

    • Net sales in Argentina decreased 53.5% in dollars and 54.1% on a currency-neutral basis due to an operating model change.

    Segment performance

    9
    SegmentRevenueYoYQoQMargin
    Consolidated
    Net sales crossed the $2 billion threshold for the first time in the company's history for a fiscal first quarter.
    Net sales in Q1 FY25: $1.85BNet sales excluding Alcohol Brands increased 27.5% YoYNet sales on a foreign currency adjusted basis increased 22.1% YoYNet sales excluding Alcohol Brands on a foreign currency adjusted basis increased 22.6% YoYAdjusted gross profit % excluding Alcohol Brands: 55.3% (vs 57.1% in Q1 FY25)Operating income: $730.0M (vs $569.7M in Q1 FY25)Adjusted operating income: $733.5M (vs $591.2M in Q1 FY25)
    		$2.35B26.9%—55.0% (Gross Profit %)
    Monster Energy Drinks segment
    Net sales in Q1 FY25: $1.72BNet sales on a foreign currency adjusted basis increased 22.8% YoY
    		$2.19B27.6%——
    Strategic Brands segment
    Net sales in Q1 FY25: $98.3MNet sales on a foreign currency adjusted basis increased 21.4% YoY
    		$126.7M28.9%——
    Alcohol Brands segment
    Net sales in Q1 FY25: $34.7M
    		$32.7M-5.9%——
    US & North America
    Strong start to the year in the U.S. and Canada, with all channels contributing to sales growth, including e-commerce.
    Ultra brand family grew 20% in Q1 FY26 vs Q1 FY25 (Nielsen)Ultra White energy drink grew 34% in Q1 FY26 vs Q1 FY25 (Nielsen)Monster's full sugar offerings grew 8.5% in Q1 FY26, outpacing overall full sugar energy drink segmentJuice Monster family grew 26% vs prior yearJava Monster (incl. Killer Brew) grew 5.2% despite ongoing softness in energy drink coffee category
    		—15.6%——
    International (total)
    Net sales in Q1 FY25: $733.2MApproximately 45% of total net sales (vs 40% in Q1 FY25)Net sales on a foreign currency adjusted basis increased 32.7% to $973.3M
    		$1.06B44.9%——
    EMEA
    Driven by strong execution, trade marketing, cooler placements, and space gains. Monster growing at over twice the rate of the category.
    Net sales increased 36.5% on a currency-neutral basis YoYGross profit % in Q1 FY25: 35.1%Monster Energy Ultra grew 37.3% (Nielsen, last 13 weeks)Juice Monster grew 23.2% (Nielsen, last 13 weeks)Monster Energy brand retained position as fastest-growing FMCG brand by value and value growth in Q1 FY26Monster is #1 energy drink brand by value in DenmarkPredator and Fury (affordable brands) remain #1 energy drink brand by value in measured countries in Africa
    		—52.5% (in dollars)—35.9% (Gross Profit %)
    Asia Pacific
    Optimistic about long-term prospects and expansion of affordable brands in China and India, despite systems disruption at Japanese distributor.
    Net sales increased 36.7% on a currency-neutral basis YoYGross profit % in Q1 FY25: 42.4%Japan net sales: +3.6% YoY (+4.9% ex-FX)South Korea net sales: +10.3% YoY (+11.8% ex-FX)China net sales: +95.0% YoY (+86.5% ex-FX)India net sales: +94.5% YoY (+104.4% ex-FX)Oceania net sales: +53.2% YoY (+42.1% ex-FX)Monster has overtaken V and Red Bull to become market leader in Australia on a value basis
    		—39.7% (in dollars)—42.8% (Gross Profit %)
    Latin America & Caribbean
    Net sales increased 22.3% on a currency-neutral basis YoYGross profit % in Q1 FY25: 44.6%Brazil net sales: +61.3% YoY (+41.9% ex-FX)Mexico net sales: +24.1% YoY (+6.6% ex-FX), gained market share and remain market leaderChile net sales: +50.3% YoY (+36.3% ex-FX)Argentina net sales: -53.5% YoY (-54.1% ex-FX) due to operating model change, but bottled depletions increased double digits
    		—36.0% (in dollars)—44.1% (Gross Profit %)

    Operational metrics

    15
    Gross Margin Impact - Geographic Mix
    120 bpsadverse impact
    Q1 FY26

    primarily reflecting strong growth in EMEA business

    Gross Margin Impact - Aluminum Headwind
    just under 1%
    Q1 FY26

    impact on margin

    Distribution expenses
    $102.8Mvs $77.6M in Q1 FY25
    Q1 FY26
    Selling expenses
    $195.0Mvs $172.3M in Q1 FY25
    Q1 FY26
    General and administrative expenses
    $265.5Mvs $228.4M in Q1 FY25
    Q1 FY26
    Stock-based compensation
    $28.3Mvs $20.7M in Q1 FY25
    Q1 FY26

    included $4 million related to certain nonrecurring equity awards that contain a retirement clause

    Operating expenses
    $563.4Mvs $478.2M in Q1 FY25
    Q1 FY26
    Adjusted operating expenses
    $549.3Mvs $447.5M in Q1 FY25
    Q1 FY26
    Effective tax rate
    24.1%vs 23.4% in Q1 FY25
    Q1 FY26
    Share repurchase
    $100M1.4 million shares
    Q1 FY26
    Remaining share repurchase authorization
    $400M
    As of May 6, 2026
    April 2026 sales growth
    24.4%YoY
    April 2026

    non-foreign currency adjusted basis

    April 2026 sales growth ex-Alcohol Brands
    24.9%YoY
    April 2026

    non-foreign currency adjusted basis

    April 2026 sales growth ex-FX
    21.6%YoY
    April 2026

    foreign currency adjusted basis

    April 2026 sales growth ex-Alcohol Brands & ex-FX
    22.1%YoY
    April 2026

    foreign currency adjusted basis

    Industry KPIs

    11
    MetricValueDetails
    Category brand sharegained share
    EPS organic EPS growth$0.58USD
    Gross operating margin55.0%%
    Organic revenue growth22.1%%
    Geographic regional mix45%%
    Unit case volume growthdouble digits%
    Aluminum packaging cost impactmodest
    Freight logistics cost pressureincreased freight-in costs
    Energy functional category healthhealthy with continued robust growth
    Pack architecture pricing actionsperforming as expected
    Cold drink equipment distribution reachcooler placements and space gains

    Product announcements

    18
    ProductTypeDetails
    Monster Ultra Punk Punchlaunch
    Juice Monster Voodoo Grapelaunch
    Monster Energy Strawberry Shots (Full Sugar & Zero Sugar)launch
    Lando Norris Zero Sugarlaunch
    FLRTlaunch
    Stormlaunch
    Monster Green and Ultra brand families (package & flavor innovation)update
    Ultra, Juice, Reign, and Bang brand families (America 250 celebrations)update
    Monster Green, Ultra White, Ultra variety pack (club channel)update
    Juice Monster Viking Berry (EMEA)launch
    Monster Energy Ultra Fantasy Ruby Red (EMEA)expansion
    Monster Energy Lando Norris Zero Sugar (EMEA)expansion
    Monster Energy Valentino Rossi Zero Sugar (EMEA)expansion
    Bang (Spain)launch
    Monster Energy Ultra Vice Guava (EMEA)launch
    Oscar Piastri Monster Green and Green Zero Sugar cans (EMEA)launch
    Gold limited edition Monster Energy Lando Norris Zero Sugar Can (EMEA)launch
    Monster Energy Green (Japan)expansion

    Capital programs

    1
    Digital Transformation Initiatives (SAP S/4HANA)underway
    Period spend: $5.8M

    Benefit: modernize enterprise platforms and strengthen end-to-end business capabilities across commercial, operations and supply chain

    General and administrative expenses in the 2026 first quarter included $5.8 million of expenses related to our digital transformation initiatives. The upgrade to SAP S/4HANA has a planned go-live date of January 1, 2028.

    Risks & headwinds

    6
    Tariff landscape complexityongoing

    modest impact on business in Q1 FY26

    Mitigation: implementing hedging strategies where possible

    Increased aluminum can costs due to Midwest Premiumcontinued modest sequential increase through at least end of 2026

    just under 1% of margin impact in Q1 FY26

    Mitigation: implementing hedging strategies

    Increased freight-in costsQ1 FY26

    resulted in out-of-orbit production costs

    Mitigation: back to operating within orbits

    Adverse impact of geographical sales mix on gross marginQ1 FY26

    approximate 120 basis points adverse impact

    Systems disruption at Japanese distributorQ4 FY25 and Q1 FY26

    impacted prior quarter, but Q1 FY26 Japan net sales still grew 3.6% in dollars and 4.9% on a currency-neutral basis

    Ongoing softness in the energy drink coffee categoryQ1 FY26

    Java Monster, including Killer Brew, increasing 5.2% despite ongoing softness

    Q&A highlights

    6

    Inquired about the company's ability to manage costs and potential for incremental pricing given strong sales momentum and expected cost increases.

    Hilton Schlosberg acknowledged Q1 gross margin headwinds from geographic mix and out-of-orbit production. Rob Gehring and Guy Carling confirmed pricing actions from late 2025 are working, and they continuously evaluate market conditions for future pricing, noting the category's resilience.

    “you don't bank percentages, you bank actual dollars.”

    asked by Chris Carey · answered by Hilton Schlosberg

    2 min read6 chapters

    Detailed Narrative

    01

    Global Energy Drink Category Health

    The global energy drink category remains healthy with continued robust growth, driven by increasing household penetration, functionality, lifestyle positioning, diverse offerings, and affordable value propositions. Monster's portfolio is well-positioned to capitalize on this growth across geographies, price points, and need states. The category is becoming more mainstream, with increasing buy rates and expanding usage occasions across dayparts.

    02

    Innovation Strategy and Performance

    Innovation continues to be a key contributor to category growth, with Monster maintaining a robust pipeline. The company's strategy is for innovation to drive its core business, as seen with new entries like FLRT for the female energy category and Storm for wellness, alongside core brand extensions. In EMEA, Juice Monster Viking Berry was the most successful innovation launch ever, contributing 45% of regional growth, with existing SKUs accounting for the remaining 55%.

    03

    Marketing and Sponsorships

    Monster maintained strong marketing momentum in Q1 FY26, leveraging high-profile sponsorships. Highlights included UFC's transition to a new broadcast partner, resulting in a 3x increase in television viewers for Monster signage. The company also saw success in MotoGP, Motocross, and Formula 1 with sponsored athletes and teams, and was the main sponsor of the WHOOP UCI Mountain Bike World Series, alongside X Games and Winter Olympics medal wins.

    04

    Digital Transformation & SAP S/4HANA

    The company is undergoing a digital transformation to modernize its enterprise platforms and strengthen end-to-end business capabilities across commercial, operations, and supply chain. This initiative includes an upgrade to SAP S/4HANA, with a planned go-live date of January 1, 2028. This transformation is expected to enhance efficiency and operational effectiveness.

    05

    Pricing Strategy & Cost Management

    Pricing actions implemented in late 2025 continue to perform as expected, with the energy drink category showing resilience to modest inflation. Management continuously evaluates opportunities for further price increases both domestically and internationally, balancing the cost environment, particularly for aluminum and freight, with consumer tolerance and overall category performance. The company aims to optimize growth while managing input costs.

    06

    Multipack Strategy and Channel Expansion

    As the energy drink category becomes more mainstream, the opportunity for multipacks is increasing. Monster has expanded its multipack offerings, including 12-pack variety packs and 24-packs of 12-ounce cans in club channels, which are driving higher household consumption rates. The company is also focused on expanding sales in non-Nielsen tracked channels and its FSOP (Food Service On-Premise) business.

    AI-generated summary of the company’s earnings call. Not investment advice.