Monster Beverage Corporation Reports Second Quarter 2024 Financial Results
Intellectia.AI2024-08-08
Monster Beverage Corporation Reports Second Quarter 2024 Financial Results
Monster Beverage Corporation (NASDAQ: MNST) today reported its financial results for the second quarter ending June 30, 2024.
Key Financial Metrics
| Metric | Q2 2024 | Q1 2024 | Q2 2023 | YoY Change | QoQ Change | Consensus Estimate |
|---|---|---|---|---|---|---|
| Total Revenue | $1.90B | $1.91B | $1.85B | +2.5% | -0.5% | $2.01B |
| Diluted EPS | $0.41 | $0.42 | $0.39 | +5.0% | -2.4% | $0.45 |
| Net Income | $425.4M | $442.0M | $413.9M | +2.8% | -3.7% | - |
Monster Beverage reported a modest growth in revenue and earnings per share (EPS) year-over-year. However, the company fell short of Wall Street's expectations, with revenue and EPS coming in below consensus estimates. This resulted in a negative sentiment in the market, causing a minor 0.53% dip in the stock price post-earnings release.
Revenue Performance by Segment
| Segment | Q2 2024 | Q2 2023 | YoY Change | Excl. Currency Impact |
|---|---|---|---|---|
| Monster Energy® Drinks | $1.74B | $1.69B | +3.3% | +6.5% |
| Strategic Brands | $109.2M | $99.7M | +9.6% | +23.6% |
| Alcohol Brands | $41.6M | $61.1M | -31.9% | - |
| Other | $7.0M | $7.3M | -4.2% | - |
Despite the overall revenue growth, Monster Beverage's Alcohol Brands segment experienced a significant decline, while the Strategic Brands segment showcased strong growth, especially when adjusted for foreign currency impacts.
Operational Data
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Gross Margin | 53.6% | 52.5% |
| Operating Expenses | $492.3M | $450.4M |
| Effective Tax Rate | 22.9% | 23.2% |
Improvements in gross margin were noted, attributed to decreased freight-in costs, selective pricing actions, and lower aluminum can costs. However, operating expenses rose, partially offsetting the gains in gross margin.
Management Commentary
Vice Chairman and Co-CEO Hilton H. Schlosberg noted, "The energy drink category in the United States and in certain other countries experienced lower growth rates in the second quarter." He highlighted the impact of reduced foot traffic in convenience stores and a shift towards mass and dollar channels as factors influencing the results. However, Schlosberg remained optimistic about the global growth of the energy drink category, citing it as an “affordable luxury” among consumers.
Chairman and Co-CEO Rodney C. Sacks emphasized the role of innovation in the company’s strategy, with plans to release new products such as Monster Energy® Ultra Vice Guava™ and continued expansion of the Predator Energy® brand in China.
Share Repurchase Program
Monster Beverage continued its robust share repurchase program, executing a $3.0 billion modified Dutch auction and repurchasing a significant number of shares in the open market. As of August 6, 2024, $342.4 million remained available under the authorized repurchase program.
Forward Guidance
The company did not provide specific forward guidance in the earnings release but mentioned an anticipated 5% price increase on core brands and packaging in the U.S. effective November 1, 2024.
Stock Price Movement
Following the earnings release, Monster Beverage's stock saw a minor decline of 0.53%, reflecting the market's reaction to the financial performance lagging behind consensus estimates.
For further information, investors are encouraged to listen to the earnings call replay, available on the company's website.
This structured breakdown offers a comprehensive summary while ensuring every section is accurately reported based on the provided data.
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