How Monster Beverage Performed in 3Q17

1 2 3 4 5
Part 2
How Monster Beverage Performed in 3Q17 PART 2 OF 5

What Drove Monster Beverage’s Higher Sales in 3Q17?

Sales beat expectations

Monster Beverage (MNST) generated net sales of $909.5 million in 3Q17, beating the consensus analyst estimate of $904.6 million. The company’s net sales grew by an impressive 15.4% on a year-over-year basis in 3Q17. The company’s 3Q17 sales growth rate was an improvement compared to the 9.6% sales growth rate in 2Q17 and the 4.1% growth in 3Q16 sales.

What Drove Monster Beverage’s Higher Sales in 3Q17?

Interested in MNST? Don't miss the next report.

Receive e-mail alerts for new research on MNST

Success! You are now receiving e-mail alerts for new research. A temporary password for your new Market Realist account has been sent to your e-mail address.

Success! has been added to your Ticker Alerts.

Success! has been added to your Ticker Alerts. Subscriptions can be managed in your user profile.

Key growth drivers

Monster Beverage’s sales growth in 3Q17 was driven primarily by the strong performance of its Monster Energy Drinks segment. The segment’s sales grew 16.6% to $827.7 million in 3Q17 owing to higher domestic and international consumer demand.

Net sales of the company’s Strategic Brands segment rose 6.2% to $76.6 million in 3Q17. This segment consists of the energy drink brands acquired from Coca-Cola (KO). Net sales of the company’s Other segment fell to $5.2 million in 3Q17 from $5.7 million in 3Q16. The Other segment includes certain products sold by American Fruits & Flavors to independent third-party customers. Monster Beverage acquired its long-time flavor supplier American Fruits & Flavors in April 2016.

Monster Beverage’s international net sales continued to be strong and grew 36.3% to $260.1 million in 3Q17. Currency headwinds had a favorable impact of about $0.7 million on the company’s 3Q17 net sales.

Sales of rivals

Monster Beverage delivered stronger sales growth than its peers in 3Q17. PepsiCo’s (PEP) revenue grew 1.3% to $16.2 billion in 3Q17, mainly driven by increased pricing. Coca-Cola’s (KO) revenue fell for the tenth straight quarter by 14.6% to $9.1 billion in 3Q17. This decline mainly reflected the impact of the company’s refranchising efforts. Dr Pepper Snapple (DPS) reported 3.6% sales growth in 3Q17 driven by a favorable product and package mix, Bai Brands sales, and higher shipments.

Despite strong sales, Monster Beverage’s margins contracted in 3Q17. We’ll discuss this in the next part of this series.


Please select a profession that best describes you: