Monster Beverage Corporation (MNST) FY2025 10-K and Q2 FY2026 10-Q Summary

Business

From the FY2025 Form 10-K, accession 0001104659-26-020831.

Monster Beverage Corporation is a holding company based in Corona, California that conducts no operating business except through its consolidated subsidiaries. Those subsidiaries primarily develop and market energy drinks, and to a lesser extent craft beers, flavored malt beverages ("FMBs") and hard seltzers.

Segments. The Company reports four operating and reportable segments:

• Monster Energy® Drinks, Monster Energy® drinks, Reign Total Body Fuel® high-performance energy drinks, Reign Storm® total wellness energy drinks and Bang Energy® drinks. Revenue comes primarily from selling ready-to-drink packaged drinks to bottlers and full-service beverage distributors, and in some cases directly to grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience and gas chains, drug stores, foodservice, value stores, e-commerce retailers and the military. This segment generates higher net revenue per case but lower gross margin percentages than Strategic Brands.
• Strategic Brands, the energy brands acquired from The Coca-Cola Company ("TCCC") in 2015 (including NOS®, Full Throttle®, Burn®, Mother®, Relentless®, Nalu®, BU®, Play®/Power Play®, Samurai®, Ultra Energy®, Live+®, BPM®) plus the affordable energy brands Predator® and Fury®. Revenue comes primarily from selling concentrates and/or beverage bases to authorized bottling and canning operations, which combine them with sweeteners, water and other ingredients. Concentrate sales fluctuate more sharply period to period than finished-goods sales because they follow bottler production schedules.
• Alcohol Brands, craft beers, FMBs and hard seltzers (Cigar City®/Jai Alai®, Oskar Blues®/Dale's Pale Ale®, Deep Ellum, Squatters®, Wasatch®, Perrin, Wild Basin® hard seltzers, The Beast, Beast® Tea, Blind Lemon®, Blinder Lemon), sold primarily to U.S. beer distributors. This segment carries lower gross margin percentages than Monster Energy® Drinks.
• Other, certain products sold by American Fruits and Flavors, LLC ("AFF"), a wholly-owned subsidiary, to independent third-party customers.

Segment mix, FY2025 vs. FY2024 (percent of net sales): Monster Energy® Drinks 92.4% / 91.6%; Strategic Brands 5.7% / 5.8%; Alcohol Brands 1.6% / 2.3%; Other 0.3% / 0.3%.

History. The business traces to Hansen's juices in the 1930s. Hansen Natural Corporation acquired the Hansen's® brand in 1992, renamed itself Monster Beverage Corporation in 2012, acquired various energy brands from TCCC and divested its non-energy business in 2015, acquired flavor supplier AFF in 2016, acquired Monster Brewing Company in 2022 (entry into alcohol), and acquired the Bang Energy® drink business in 2023.

Manufacturing and supply. In 2025 the Company continued to outsource manufacturing of the majority of its finished-goods energy drink products to third-party bottlers and contract packers. It manufactures Bang Energy® drinks and certain other energy drinks at owned facilities in Phoenix, Arizona and Norwalk, California. AFF develops and manufactures the primary flavors for the Monster Energy® Drinks segment at facilities in California and Athy, Ireland. Alcohol products are made largely at owned or leased facilities (Longmont, Colorado; Brevard, North Carolina; Grand Rapids, Michigan) or at third-party co-packers. Principal raw materials are aluminum cans in several formats, kegs, cartons, to a limited extent PET bottles, plus flavors, juice concentrates, glucose, sugar, sucralose, milk, cream, coffee, tea, hops, malt, yeast, ethanol and supplement ingredients. Purchase agreements with key packaging and ingredient suppliers cover roughly one to three years of anticipated volume. For certain flavors the third-party supplier owns the formula and the Company does not hold the ingredient list, limiting substitution.

Distribution. Distribution agreements with bottlers/distributors run initial terms of up to twenty years. All U.S. distribution territories and substantially all international territories have been transitioned to TCCC network bottlers/distributors. Strategic Brands are distributed under distribution coordination agreements with TCCC. Alcohol products are distributed through Monster Brewing Company's separate beer-distributor network. Products are distributed in approximately 158 countries and territories.

Customers and concentration. Non-alcohol customers include Coca-Cola Europacific Partners, Coca-Cola Consolidated, Coca-Cola Bottling Company United, Coca-Cola Canada Bottling, Reyes Holdings, Swire, Liberty Coca-Cola, Coca-Cola Hellenic, Coca-Cola FEMSA, Swire Coca-Cola (China), COFCO Coca-Cola, Coca-Cola Beverages Africa, Coca-Cola İçecek, Asahi Soft Drinks, Wal-Mart (including Sam's Club), Costco and Amazon. Alcohol customers include Reyes Beverage Group, Ben E. Keith, J.J. Taylor Distributing and Admiral Beverage. Coca-Cola Europacific Partners accounted for approximately 15%, 14% and 13% of net sales in 2025, 2024 and 2023; Coca-Cola Consolidated accounted for approximately 10% in each of those years.

Market and competition. Beverage Marketing Corporation estimates domestic U.S. wholesale sales of the "alternative" beverage category at approximately $76.8 billion in 2025, up about 2.4% from approximately $75.0 billion in 2024. Domestically, Monster's energy drinks compete directly with Red Bull, CELSIUS, Alani Nu, C4, Ghost, 5-Hour Energy, Rockstar, Bloom, V8 + Energy and Venom; internationally with Red Bull, Rockstar, V-Energy, Lucozade and numerous local brands. Java Monster® competes with Starbucks ready-to-drink coffee, Black Rifle Coffee and others. Alcohol brands compete with Molson Coors, Constellation Brands, AB InBev, The Boston Beer Company and The Mark Anthony Group. The 10-K notes competitor consolidation, including Keurig Dr Pepper's distribution agreement with Black Rifle Coffee and its definitive agreement to acquire GHOST Lifestyle LLC and GHOST Beverages LLC, Celsius Holdings' acquisition of Alani Nutrition LLC, and PepsiCo's 2022 long-term distribution arrangement with Celsius.

Intellectual property. More than 21,600 registered trademarks and pending applications worldwide. The Company also owns the intellectual property of its most important flavors for certain Monster Energy® brand energy drinks in perpetuity.

Marketing. Strategy centers on brand awareness through image-enhancing programs and sampling, supported by promotions, endorsements of athletes, teams, series, bands and esports, influencer partnerships, and "push-pull" methods for shelf and cooler space. Sales and marketing expenditures rose approximately 6.3% in 2025 versus 2024.

Seasonality. The second and third calendar quarters carry the highest sales volumes, though energy drinks appear less seasonal than traditional beverages and international growth may further dampen the effect.

Regulation. The Company operates under a broad and tightening regulatory overlay: the FD&C Act, California Proposition 65, alcohol licensing and excise regimes (federal, state and local, plus the TTB), environmental statutes and data privacy laws. The 10-K flags specific developments, the January 2026 U.S. Dietary Guidelines for Americans urging limits on energy drinks; state removals of such products from SNAP; West Virginia's 2025 additive ban (stayed by preliminary injunction pending legal challenge) and Texas's 2025 warning law covering roughly 44 enumerated ingredients (also under challenge); an FDA proposed rule on front-of-pack nutrition labeling and a planned post-market review of food ingredients and GRAS reform; age restrictions on energy drink sales already in force in Honduras, Latvia, Lithuania, Poland, Romania, Hungary, Turkey, Armenia, Bahrain and Kuwait (under 18), Norway (under 16) and Kazakhstan (under 21); caffeine content limits in Canada (180mg per single-serving container), the Netherlands (35mg/100ml) and Norway (32mg/100ml); and excise taxes on sweetened or energy beverages in France, the U.K., Ireland, South Africa, Mexico, Poland, Colombia, Slovakia and Hungary, with a 100% selective tax on energy drinks in Bahrain, Saudi Arabia, the UAE, Qatar and Oman. Latvia has announced an energy drink excise rate effective January 1, 2028. U.S. tariff and trade measures, and possible retaliatory measures, are identified as a cost and disruption risk.

Human capital. As of December 31, 2025 the Company had 6,891 employees across 80 countries, 4,559 in North America, 448 in Latin America, 308 in Asia Pacific (including Oceania) and 1,576 in EMEA. 5,773 are full-time and 1,118 part-time; 2,336 work in corporate and operational capacities and 4,555 in sales and marketing.

Risk factors

From the FY2025 Form 10-K, accession 0001104659-26-020831.

Dependence on The Coca-Cola Company

The Company has transitioned all third-party rights to distribute its energy drinks in the U.S. to TCCC's network, and except for a handful of countries TCCC is its preferred distribution partner globally. Distributor diversification has been reduced accordingly, and performance is now substantially dependent on TCCC's domestic and international platforms. TCCC does not control all members of its system, many are independent companies making their own decisions, and disagreements over the interpretation of the parties' agreements have arisen and may arise again.

TCCC is also a large shareholder: as of February 13, 2026 it owned approximately 20.9% of common stock and has nominated one director; Messrs. Sacks and Schlosberg together may be deemed to beneficially own or control approximately 8.1%. TCCC must vote shares above 20% proportionally on a change-of-control proposal, but if it opposed such a transaction a bidder would need support from holders of more than 62.5% of the shares TCCC does not own. TCCC would also not need to pay a control premium on its own shares, and either party could terminate the distribution coordination agreements after a change in control, with a termination fee payable to TCCC in specified circumstances.

Operational and industry

• Reliance on third-party bottlers and co-packers. Most non-alcohol finished goods are made by third parties. Co-packer consolidation has left the Company relying on fewer groups, some of which account for a large share of Monster Energy® co-packing capacity. Alternative facilities with adequate long-term capacity may not be available at commercially reasonable rates or within a reasonable time or distance.
• Concentrated owned production. Primary flavors come from AFF's Southern California and Athy, Ireland facilities; Bang Energy® and certain other drinks from Phoenix and Norwalk; alcohol from Longmont, Brevard and Grand Rapids. Disruption at any of these could halt production of the affected products.
• Distributor and retailer decisions. Bottlers/distributors are typically affiliated with competing products. Unilateral decisions by distributors, buying groups, convenience and gas chains, grocery chains, mass merchandisers, club stores or e-commerce retailers to discontinue, restrict or de-prioritize the Company's products, including delisting arising from trading disputes, could hurt the business.
• Revenue concentration in energy drinks. Most revenue derives from energy drinks; any decline in Monster Energy® brand sales would significantly affect revenue and net income. Competition includes both new category entrants and limited retail and cooler shelf space.
• Product perception. Unfavorable reports or publicity on caffeine or other energy-drink ingredients, regardless of scientific merit, could reduce demand; management believes U.S. category growth may already have been dampened by such coverage. Alcohol faces parallel scrutiny over drunk driving, underage drinking and health effects.
• Growth strategy and acquisitions. Integration of acquired businesses (Bang Energy®, Monster Brewing Company) may not deliver expected benefits. In 2025 the Company recognized impairment charges of $38.4 million on certain finite-lived intangible assets and $15.3 million on property and equipment in the Alcohol Brands segment (the FY2025 consolidated statement of cash flows instead reports impairment of property and equipment of $12.0 million; the 10-K does not reconcile the two presentations).
• International expansion. Net sales outside the U.S. were approximately 41%, 40% and 38% of consolidated net sales in 2025, 2024 and 2023. International gross margins are expected to be lower than U.S. margins. Risks include political and economic instability, currency movements, repatriation restrictions and taxes, tariffs, local compliance and staffing, higher product damage rates on long shipments, higher incidence of fraud or corruption such as invoicing fraud or kickback schemes, and local customer credit risk.
• Input costs. Aluminum cans, ingredients, fuel, co-packing fees and tariffs may rise without a corresponding ability to raise prices; certain co-packing arrangements let packers pass through their own cost increases. Derivatives are used for a portion of aluminum exposure but generally not for other commodities.
• Demand estimation and inventory. Demand forecasting is imprecise, especially for new products and in fast-growing or new markets; industry-wide ingredient and packaging shortages have occurred and could recur. Excess inventory risks write-offs; high distributor or retailer inventory suppresses reorders.
• Seasonality. Results for any quarter may not indicate full-year results.
• Catastrophic events and climate. Headquarters and much of operations sit in California, exposed to earthquakes and wildfires. Hurricanes Helene and Milton affected retail sales in certain states in late 2024, and Helene flooding closed the Brevard, North Carolina brewery for one week with reduced capacity for about a month; the AFF Southern California facility was temporarily closed in early 2025 because of air pollution from the Los Angeles wildfires. Management characterized the impact of those events as ultimately immaterial.
• Workforce. The Company maintains no key-person life insurance; loss of key senior management could affect the business until replacements are found.
• Reputation. Brand image can be damaged by claims about product safety or quality, sponsorship-related misconduct, social-media campaigns, or human-rights and environmental allegations, whether or not warranted.
• Artificial intelligence. The Company relies on AI technologies in products, services and internal operations; inaccurate, biased or unpredictable outputs, or failures in data quality, design or oversight, could cause operational disruptions and privacy or security incidents. Divergent and evolving AI regulation across markets could raise compliance costs or force product and process changes.

Government regulation and litigation

• Restrictive legislation on energy drink sales, caffeine and ingredient content, labeling and warnings, excise taxes, product size and age limits, enacted or proposed at U.S. federal, state and municipal level and abroad, could reduce demand or availability where a significant volume of product is sold.
• Alcohol beverages are heavily regulated as to licensing, warehousing, trade and pricing practices, labeling, advertising and wholesaler/retailer relations, with particular scrutiny of non-alcohol companies expanding into alcohol because of crossover appeal.
• Environmental laws governing air emissions, water discharge and use, waste, recycling and extended producer responsibility apply to the Company and its co-packers, and greenhouse-gas and water-scarcity rules are expected to expand.
• Inquiries and enforcement actions by state attorneys general and other agencies into production, advertising, marketing, promotion, labeling, ingredients, usage or sale of the products could result in fines, reformulations, container changes or advertising restrictions.
• Litigation exposure spans intellectual property, fraud, unfair business practices, false advertising, product liability, breach of contract, claims from prior distributors, labor and employment, personal injury, consumer class actions, securities actions, data protection matters and shareholder derivative actions. The Monster Brewing acquisition adds alcohol-marketing and alcohol-abuse claims.
• Product recalls: limited recalls have occurred in recent years in Canada, Europe and the United States. The Company does not maintain recall insurance.

Intellectual property, information technology and data privacy

• Trademark and copyright rights are described as critical; the Company has been, and may be, unable to use certain marks, trade names, designs or trade dress in certain countries.
• The Company has been the subject of cybersecurity incidents and may be again. It maintains cybersecurity insurance that may be insufficient to cover all losses. It is upgrading its enterprise resource planning system, implementing SAP S4 HANA with a planned go-live date of January 1, 2028; delays or failures in that project could disrupt operations. Third-party service providers and partners present a parallel exposure the Company does not control.
• Data privacy regimes including the EU GDPR, U.S. state privacy laws and China's Personal Information Protection Law impose operational requirements and penalties.

Financial

• Effective tax rate. 2022–2025 U.S. federal returns remain open to IRS examination, state returns generally for 2021–2025, and U.K. and Ireland returns for 2021–2025. The One Big Beautiful Bill Act was enacted July 4, 2025, and the OECD agreed a BEPS global minimum tax framework as recently as early January 2026; both could affect the provision for income taxes.
• Impairment. As of December 31, 2025 goodwill totaled approximately $1.33 billion and other intangible assets approximately $1.38 billion. Goodwill impairment charges of $86.3 million were recorded in 2024 against the Alcohol Brands reporting unit, after which no goodwill remained for that unit; the accumulated goodwill impairment balance at December 31, 2025 was $86.3 million, entirely Alcohol Brands. Indefinite-lived intangible impairments were $40.8 million in 2024 and $38.7 million in 2023, with none in 2025.
• Foreign currency. Aggregate foreign currency transaction losses were $(11.9) million, $(26.4) million and $(60.2) million for 2025, 2024 and 2023. Forward contracts hedge only part of the exposure.
• Macroeconomic and counterparty exposure. Global economic uncertainty, inflation, interest rates and geopolitical tension affect forecasting and consumer purchasing power. Large cash, investment and derivative balances held with financial institutions expose the Company to counterparty default.
• Stock price volatility. The Company states that its stock price is subject to significant volatility and that stockholders may not be able to sell at attractive prices, and that periods of volatility could prompt securities class action litigation. The Company does not provide guidance on future performance, including revenues, margins, product mix, operating expenses, net income or earnings per share, and may not meet analyst forecasts.

Legal proceedings. The Company is named from time to time in litigation including mediation, arbitration, administrative proceedings, labor and employment, personal injury, consumer class actions, intellectual property, data privacy and claims from prior distributors. Management believes such litigation in aggregate will likely not have a material adverse effect on financial position or results of operations. Loss contingencies included in the consolidated balance sheets were $36.2 million at December 31, 2025 and $16.8 million at December 31, 2024.

Management's discussion and analysis, fiscal year 2025

From the FY2025 Form 10-K, accession 0001104659-26-020831. All figures are for the years ended December 31.

Value drivers management identifies

International growth (products distributed in approximately 158 countries and territories); profitable growth through "functional" value-added brands supported by marketing and innovation; cost management focused on reducing per-case input and production costs, co-packing fees and freight through strategically localized co-packing, and on lowering promotional allowances and selling and administrative costs as a percentage of net sales; and an efficient capital structure optimizing working capital, with accounts receivable days outstanding and inventory days on hand a continuing focus.

Results

Net sales were $8.29 billion in 2025, up approximately $801.6 million or 10.7% from $7.49 billion in 2024, driven primarily by increased worldwide sales of Monster Energy® brand energy drinks on increased consumer demand. Currency movements were an unfavorable $3.0 million; on a foreign-currency-adjusted basis net sales also rose 10.7%. Record annual net sales.

By segment:

Strategic Brands growth came primarily from Predator®, Burn® and NOS®. The Alcohol Brands decline was driven primarily by lower sales of Beast® Tea and The Beast.

International. Net sales to customers outside the United States were $3.44 billion, up from $2.96 billion, or approximately 41% of net sales versus 40%. Currency was an unfavorable $3.0 million; on a currency-adjusted basis international net sales rose 16.2%.

Volume and price per case. Energy drink case sales in 192-ounce case equivalents were 959.0 million, up 112.3 million or 13.3% from 846.7 million. Average net sales per case for energy drinks (excluding Alcohol Brands and Other) declined 1.6% to $8.48 from $8.62, primarily on adverse currency movements and geographical sales mix. Craft beer, FMB and hard seltzer case sales fell 22.6% to 9.7 million cases (0.47 million barrels).

Gross profit was $4.63 billion, up approximately $583.3 million or 14.4% from $4.05 billion. Gross margin rose to 55.8% from 54.0%, primarily on the Pricing Actions and supply chain optimization, partially offset by higher promotional allowances and geographical sales mix. Price increases were implemented in the fourth quarters of fiscal 2025 and fiscal 2024 for core U.S. brands and packages, and at various times in certain international markets during 2025 and 2024 (the "Pricing Actions"). Gross profit is not necessarily comparable across companies: Monster includes out-bound freight and warehouse costs in operating expenses rather than cost of sales.

Operating expenses were $2.21 billion, up approximately $94.3 million or 4.4%, primarily on $80.4 million of increased payroll expense. Operating expenses fell to 26.7% of net sales from 28.3%. Operating expenses included Alcohol Brands impairment charges of $53.7 million in 2025 (primarily finite-lived intangibles and property and equipment) versus $138.8 million in 2024 (primarily goodwill, other indefinite-lived intangibles and property and equipment).

Operating income was $2.42 billion, up approximately $489.1 million or 25.3%, with operating margin rising to 29.2% from 25.8%. International operations excluding Canada contributed operating income of $659.3 million versus $536.3 million. Segment operating results, before corporate and unallocated expenses: Monster Energy® Drinks $2.98 billion (+20.9%); Strategic Brands $240.8 million (+3.0%); Alcohol Brands an operating loss of $127.0 million, narrowed 36.6% from a $200.3 million loss, primarily on lower impairment charges, excluding those impairments the Alcohol Brands operating loss widened to $73.3 million from $61.6 million; Other $3.4 million (−25.9%).

Below the operating line. Interest and other income, net, was $63.2 million versus $59.2 million; interest income fell to $85.2 million from $115.0 million while interest expense fell to $6.6 million from $27.9 million. The provision for income taxes was $577.1 million, up 20.1%, at an effective combined federal, state and foreign rate of 23.2% versus 24.1%, the decrease primarily attributable to a larger stock-based compensation deduction.

Net income was $1.91 billion, up $396.4 million or 26.3% from $1.51 billion.

Non-GAAP measures management reports

Gross billings, amounts invoiced to customers net of cash discounts, returns and excise taxes, before promotional items, were $9.83 billion, up approximately $1.09 billion or 12.5% from $8.74 billion. Segment gross billings: Monster Energy® Drinks $9.12 billion (+13.3%); Strategic Brands $545.4 million (+11.1%); Alcohol Brands $139.8 million (−20.9%); Other $25.2 million (+6.5%). Promotional allowances, commissions and other expenses were $1.57 billion, up $290.5 million or 22.6%, rising to 16.0% of gross billings from 14.7%.

Liquidity and capital resources

At December 31, 2025 the Company held $2.09 billion in cash and cash equivalents, $677.1 million in short-term investments and $487.3 million in long-term investments (commercial paper, certificates of deposit, municipal securities, U.S. treasuries and corporate bonds). Of the cash, $1.00 billion was held by foreign subsidiaries, and no investments were held by foreign subsidiaries. Working capital was $3.91 billion versus $2.54 billion a year earlier, the increase primarily from higher cash and short-term investments.

Cash provided by operating activities was $2.10 billion versus $1.93 billion, driven by net income of $1.91 billion plus non-cash items of $129.8 million depreciation, amortization and non-cash lease expense, $125.7 million stock-based compensation, $38.4 million intangible impairment and $12.0 million property and equipment impairment; working capital sources included a $98.3 million increase in accrued promotional allowances, $81.3 million in accrued liabilities, $78.5 million in accounts payable, $27.8 million in income taxes payable and $17.8 million in accrued compensation, against a $300.6 million increase in accounts receivable, $39.3 million in prepaid expenses and other assets, $34.9 million in inventories, a $23.0 million decrease in deferred revenue and a $21.1 million increase in prepaid income taxes. Net cash used in investing activities was $1.32 billion, versus $733.7 million provided in 2024, driven both years primarily by purchases and sales of available-for-sale investments. Cash used in financing activities was $324.4 million versus $3.33 billion in 2024; purchases of common stock held in treasury were $103.6 million in 2025 against $3.77 billion in 2024.

Debt. The May 2024 credit agreement with JPMorgan Chase Bank, N.A. as administrative agent originally provided $1.50 billion of senior unsecured facilities, a $750.0 million term loan and up to $750.0 million of multicurrency revolving commitments. The term loan was repaid in April 2025 with no further borrowing permitted, and Amendment No. 1 dated October 17, 2025 reduced revolving capacity to $500.0 million. The revolver matures in May 2029. No borrowings were outstanding at December 31, 2025 and the Company was in compliance with all covenants; as of February 26, 2026 the revolver had $500.0 million of remaining availability.

Outlook items. Management stated it expected capital expenditures, excluding common stock repurchases, to be less than $250.0 million through December 31, 2026, and expected cash from operations plus cash resources and access to credit to be sufficient for working capital needs for at least the next twelve months. Approximately $3.2 million of unrecognized tax benefits were recorded as liabilities at December 31, 2025, with $0.9 million of accrued interest and penalties. Inflation did not have a significant impact on 2025 results, in contrast to 2024, which management attributes in part to the Pricing Actions.

Market risk. Principal exposures are commodity and input costs (aluminum cans, sweeteners, juice concentrates, dairy, coffee, tea, hops, malt, yeast), energy and fuel prices, tariffs and raw-material availability. The Company does not use derivatives to manage interest rate risk and, except for aluminum, generally does not hedge commodity prices. During 2025 it entered forward currency exchange contracts, all with terms of three months or less at year-end, to economically hedge part of the non-functional-currency asset and liability exposure of certain subsidiaries; these are not designated as hedges under ASC 815, so gains and losses run through interest and other income, net.

Current quarter, three months ended June 30, 2026

From the Q2 FY2026 Form 10-Q, accession 0001104659-26-092193, and the earnings release furnished as Exhibit 99.1 to the Form 8-K dated August 6, 2026, accession 0001104659-26-092046.

Note on basis: the 10-Q presents both three-month and six-month income statement columns, but its condensed consolidated statement of cash flows covers the six months ended June 30, 2026 only. Cash flow figures below are therefore six-month figures and are labeled as such.

The quarter

Net sales were $2.54 billion for the three months ended June 30, 2026, up approximately $425.9 million or 20.2% from $2.11 billion in the same period of 2025, primarily on increased worldwide sales of Monster Energy® brand energy drinks driven by consumer demand. Currency was a favorable $48.5 million; on a foreign-currency-adjusted basis net sales rose 17.9%.

By segment for the three months ended June 30, 2026: Monster Energy® Drinks $2.36 billion, up $418.8 million or 21.6% (+19.3% currency-adjusted); Strategic Brands $143.7 million, up $13.8 million or 10.6% (+8.1% currency-adjusted), on higher Fury®, Predator® and Burn® sales partially offset by lower NOS®; Alcohol Brands $32.2 million, down $5.8 million or 15.2%, primarily on lower sales of The Beast; Other $5.4 million, down $1.0 million or 15.3%. Segment mix shifted toward the core: Monster Energy® Drinks was 92.8% of net sales versus 91.7% a year earlier, Strategic Brands 5.7% versus 6.2%, Alcohol Brands 1.3% versus 1.8%, Other 0.2% versus 0.3%.

International was the standout. Net sales to customers outside the United States were $1.16 billion, up approximately $298.9 million or 34.6% from $864.2 million, reaching approximately 46% of net sales versus 41% a year earlier. Currency was a favorable $48.5 million; on a currency-adjusted basis international net sales rose 29.0%.

Volume. Energy drink case sales in 192-ounce case equivalents were 304.9 million, up 55.6 million or 22.3% from 249.3 million. Average net sales per case for energy drinks decreased marginally to $8.20 from $8.29, volume, not price, carried the quarter, and the reported per-case decline came despite a favorable currency effect on the average. Craft beer, FMB and hard seltzer case sales fell 16.1% to 2.3 million cases (0.11 million barrels).

Margins. Gross profit was $1.42 billion, up approximately $243.2 million or 20.7%. Gross margin edged up to 55.9% from 55.7%, primarily on the Pricing Actions and product sales mix, partially offset by increased aluminum can costs, geographical sales mix and increased freight-in costs. (The Pricing Actions in the current-year framing are the fourth-quarter 2025 U.S. increases on core brands and packages plus international increases at various times during 2025.)

Operating expenses were $679.2 million, up approximately $134.4 million or 24.7%, and rose to 26.8% of net sales from 25.8%. The increase came primarily from $72.3 million more selling and marketing expense, $36.8 million more distribution expense and $18.0 million more payroll. Management attributes the selling and marketing increase to greater social, digital, media and other marketing spend, including sponsorships and endorsements, to reach a broader consumer audience and increase household penetration. The earnings release breaks the line out: distribution expenses $118.8 million, or 4.7% of net sales, versus $82.0 million or 3.9%; selling expenses $269.2 million, or 10.6%, versus $196.9 million or 9.3%; general and administrative expenses $291.2 million, or 11.5%, versus $265.9 million or 12.6%, with stock-based compensation of $35.7 million versus $33.2 million.

Operating income was $740.4 million, up approximately $108.8 million or 17.2%, but operating margin slipped to 29.2% from 29.9% as operating expense growth outpaced sales growth. International operations excluding Canada produced operating income of $247.5 million versus $164.1 million. Segment operating results before corporate and unallocated expenses: Monster Energy® Drinks $875.7 million, up $118.2 million or 15.6%; Strategic Brands $66.3 million, down $1.5 million or 2.2% on higher operating expenses; Alcohol Brands an operating loss of $7.3 million, half the $14.6 million loss a year earlier, primarily on lower general and administrative expenses; Other an operating loss of $0.2 million versus $1.3 million of operating income.

Below the operating line. Interest and other income, net, was $27.8 million versus $15.1 million; interest income nearly doubled to $36.0 million from $18.1 million while interest expense fell to $0.8 million from $1.8 million, and foreign currency transaction losses widened to $6.0 million from $2.1 million. The provision for income taxes was $183.7 million versus $157.9 million, at an effective combined rate of 23.9% versus 24.4%.

Net income was $584.5 million, up $95.7 million or 19.6% from $488.8 million. The earnings release reports net income per diluted share of $0.59, up 19.0% from $0.50, on the pre-split share count; on a non-GAAP adjusted basis it reports net income of $590.5 million (+15.7%), adjusted operating income of $748.1 million (+13.3%) and adjusted diluted EPS of $0.60 (+15.2%). Chief Executive Officer Hilton H. Schlosberg said the Company "delivered a strong 2026 second quarter," pointed to international net sales growth of 34.6% to approximately 46% of total, described a 2026 marketing strategy of increased investment across social, digital and media platforms and partnerships to reach a broadening consumer base, and said the Company remains focused on growth of existing core offerings and continued product innovation.

Gross billings (non-GAAP) were $2.99 billion for the three months, up approximately $491.7 million or 19.7%, and $5.76 billion for the six months, up approximately $1.10 billion or 23.5%. Promotional allowances, commissions and other expenses were $464.9 million for the quarter, up $65.9 million or 16.5%, but declined as a share of gross billings to 15.5% from 16.0%, allowances grew more slowly than billings in the quarter, the reverse of the full-year 2025 pattern.

Customer concentration in the quarter: Coca-Cola Europacific Partners accounted for approximately 16% of net sales versus 15% a year earlier; Coca-Cola Consolidated approximately 9% versus 11%.

Six months ended June 30, 2026

Net sales were $4.89 billion, up approximately $924.6 million or 23.3% from $3.97 billion, with a favorable $137.8 million currency effect and a 19.8% currency-adjusted increase. Gross margin decreased to 55.5% from 56.1%, primarily on geographical sales mix, increased aluminum can costs and increased freight-in costs, partially offset by the Pricing Actions and product sales mix, the opposite direction from the quarter alone. Operating expenses were $1.24 billion, up $219.6 million or 21.5% (selling and marketing +$95.0 million, distribution +$62.0 million, payroll +$46.4 million), improving to 25.4% of net sales from 25.8%. Operating income was $1.47 billion, up $269.0 million or 22.4%, at a 30.1% margin versus 30.3%. The effective tax rate was 24.0% versus 23.9%. Net income was $1.15 billion, up $222.2 million or 23.9% from $931.8 million; the earnings release reports six-month net income per diluted share of $1.17 versus $0.95, pre-split. Energy drink case sales were 579.4 million, up 25.3%, at an average of $8.31 per case versus $8.39.

Product and portfolio developments

New products sold during the three months ended June 30, 2026 were Bang Energy® American Berry, Bang Energy® White Gummy Bear, Burn® White Gummy Bear, Fury® Wild Berry, Monster Energy® Nitro Blue Flash and Reign Total Body Fuel® Liberty & Justice for Apple. The 10-Q's description of the Monster Energy® Drinks segment now names Storm and FLRT total wellness energy drinks alongside Reign Storm®, brands not listed in the segment description in the FY2025 10-K.

Liquidity at June 30, 2026

Cash and cash equivalents were $2.19 billion, short-term investments $1.23 billion and long-term investments $781.3 million (commercial paper, municipal securities, U.S. government agency securities, U.S. treasuries and corporate bonds). Of the cash, $912.8 million was held by foreign subsidiaries, and no investments were held by foreign subsidiaries.

For the six months ended June 30, 2026, cash provided by operating activities was $1.11 billion versus $973.6 million in the prior-year six months, attributable primarily to net income of $1.15 billion plus $65.9 million of depreciation, amortization and non-cash lease expense and $64.0 million of stock-based compensation, with a $192.2 million increase in accounts payable, $56.5 million in accrued promotional allowances, $25.8 million in income taxes payable and $18.4 million in accrued liabilities, offset by a $290.4 million increase in accounts receivable, $73.8 million in inventories, $62.3 million in prepaid expenses and other assets and a $27.1 million decrease in accrued compensation. Cash used in investing activities was $929.3 million for the six months versus $357.7 million, primarily purchases of available-for-sale investments. Cash used in financing activities was $58.7 million for the six months versus $309.0 million, primarily repurchases of common stock in 2026 versus credit facility repayments in 2025.

No borrowings were outstanding under the Credit Facilities at June 30, 2026 and the Company was in compliance with all covenants; as of August 5, 2026 the revolver had $500.0 million of remaining availability. Purchase commitments were approximately $218.9 million and contractual obligations, related primarily to sponsorships and other marketing activities, approximately $746.6 million. Unrecognized tax benefits recorded as liabilities were approximately $3.6 million, with $1.1 million of accrued interest and penalties. Loss contingencies included in the balance sheet were $30.3 million at June 30, 2026 versus $36.2 million at December 31, 2025. Management estimates capital expenditures, excluding common stock repurchases, will be less than $250.0 million through June 30, 2027, and states inflation did not have a significant impact on results for the three and six months ended June 30, 2026.

Share repurchases. No shares were repurchased under either the August 2024 Repurchase Plan or the May 2026 Repurchase Plan during the three months ended June 30, 2026. As of August 5, 2026 approximately $400.0 million remained available under the August 2024 plan and approximately $500.0 million under the May 2026 plan, $900.0 million in aggregate. Separately, 1,358 shares were purchased from employees during the quarter in lieu of cash for option exercise prices or withholding taxes, totaling $0.1 million; these are not counted against the authorized programs.

Risk factors. The 10-Q reports no changes, directing readers to the risk factors in the FY2025 Form 10-K, and reports no material changes in market risks during the three and six months ended June 30, 2026 relative to Item 7A of that Form 10-K.

Subsequent events

From Note 18 to the condensed consolidated financial statements in the Q2 FY2026 Form 10-Q, accession 0001104659-26-092193, and from the Form 8-K dated July 8, 2026, accession 0001104659-26-081842, as noted below.

Note 18 records that the Company's Board of Directors approved and declared a two-for-one split of its common stock, to be effected in the form of a 100% stock dividend, with the stock dividend to be distributed after the close of trading on August 10, 2026, and the Company anticipating its common stock beginning to trade at the split-adjusted price on August 11, 2026. The record date comes from Item 8.01 of that Form 8-K dated July 8, 2026, which announced the split: each stockholder of record on July 24, 2026 will receive a dividend of one additional share of common stock for each then-held share.

The 10-Q presents unaudited pro forma weighted-average shares and per-share amounts giving effect to the split as if it had been effective for all periods presented: pro forma basic weighted-average shares of 1,957,325 thousand for the three months ended June 30, 2026 (1,951,499 thousand in the prior-year quarter) and 1,956,973 thousand for the six months (1,949,383 thousand); pro forma diluted shares of 1,976,957 thousand for the three months ended June 30, 2026 (1,967,995 thousand in the prior-year quarter) and 1,976,911 thousand for the six months (1,965,496 thousand). On that pro forma split-adjusted basis, net income per diluted share was $0.30 for the three months ended June 30, 2026 versus $0.25, and $0.58 for the six months versus $0.47; pro forma basic was $0.30 versus $0.25 for the quarter and $0.59 versus $0.48 for the six months.

The subsequent events note discloses no acquisitions, divestitures, financings or litigation outcomes after June 30, 2026.