What Is The One Risk Every Celsius Investor Should Know?
If you own Celsius (CELH), your worry probably sounds like this. The energy drink company grew very fast. Lately, something has started to slip. The worry is fair, and it is narrower than it looks. One part of Celsius is going backwards. Management said so plainly on its latest call. So where is Celsius losing ground?
Where Is Celsius Losing Ground?
The trouble sits in the flagship Celsius drink. Its reported net sales fell about 12% from a year earlier in fiscal Q2 2026. Retail sales in tracked stores fell only 2% in the same quarter. The drop is much bigger in what Celsius books than in what shoppers buy. Either way, the product the company is named after is the one going backwards.
Management described a category with more competition than ever before. It said there are more new entrants and more established players.
Some of the damage was self-inflicted. The company cut too many products from the flagship line. Management said it went too deep, and that looking back it would have cut far fewer products.
The drink was also stocked in about 7% fewer places in the second quarter than in the first. But each of those places sold about 16% more of it. An analyst asked management whether the drink’s sales could fall further from here. What you do not know is how much of the company rides on that one drink.
How Much Of Celsius Does This Touch?
Celsius sold about $3.0 billion of drinks over the last twelve months. It has no separate reporting segment to ring-fence the weak brand. So weakness in the flagship drink shows up in the whole company.
Revenue in fiscal Q2 2026 was $818 million. That was about 11% higher than a year earlier. Growth averaged about 50% a year over the past three years.
The growth that is left does not come from the flagship. Alani Nu brought in about $364 million of that quarter. Its reported sales grew about 21% from a year earlier. In tracked stores its sales grew about 56%. An analyst pointed out that Alani Nu faces a very big comparison of its own.
The price has come down, but it still asks for growth. You pay 58 times the company’s earnings for the stock. The S&P 500 trades at 22.6 times its earnings.
The shares are 55% below where they peaked over the past year. So the market is not ignoring the problem. Even so, the price appears to assume the flagship drink returns to growth. So how worried should you be?
How Worried Should You Be?
Worried enough to treat this as a stock that can fall a long way. Not worried enough to call the business broken. Celsius has taken hard falls before, though not in every market drop.
The stock lost 46% from its peak to its low between January 2022 and October 2022. The S&P 500 lost 24% over that window. In the market drop of July and August 2024, the stock lost 33%. The index lost 7.8% then. Between February and June 2025 the stock lost only 2.6%. The index lost 19.0% then.
Think about that in money. Put $10,000 into the stock. A fall like the 2022 one would leave about $5,400.
What would settle the question is close at hand. Management expects the flagship drink in the third quarter to look a lot like the second. It expects that same drink to exit the year back into growth.
New products for the 16-ounce line arrive in early 2027. On its August call management said a second manufacturing line in North Carolina begins producing in the back half of fiscal 2026. Management also said it will give more detail on the next call, after third quarter results.
For the risk to be worth taking, two things have to hold. Alani Nu has to keep growing through its harder comparison. The flagship drink has to stop shrinking. If it is still shrinking after the third quarter, the risk has not passed.
How To Act On CELH?
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