Monster Beverage missed Wall Street estimates for third-quarter sales and profit on Thursday as cost-conscious customers cut back on spending on higher-priced beverages.
Shares of the company were down about 3% after the bell.
Consumers – especially those from low to middle-income groups – have been opting for private label alternatives to branded non-alcoholic drinks.
Monster is not the only company feeling the pinch – other companies such as Keurig Dr Pepper and PepsiCo have seen their sales hurt by cautious spending.
Competitor Coca Cola, however, was able to attract customers with tight budgets in the US.
For the third quarter, the company posted net sales of $1.88 billion compared with analysts’ average estimate of $1.91 billion, according to date from the London Stock Exchange Group.
On an adjusted basis, it posted profit of 40 cents per share, below estimates of 43 cents per share.
Speaking about other factors, CEO of Monster Hilton Schlosberg said, “Hurricanes Helene and Milton impacted sales at retail in certain states in September and October, however, we cannot determine the impact on our business.”
However, benefits from taking 5% prices during the quarter ending 30 September, coupled with lower output costs helped the company’s margins.
Monster’s quarterly gross profit as a percentage of sales was 53.2% compared with 53.0% a year ago.
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