Zevia PBC NYSE: ZVIA raised its full-year sales and adjusted earnings outlook after third-quarter revenue rose 18.4%, helped by stronger-than-expected club-channel sales and online demand. The beverage company also outlined plans to use a $20 million equity investment to fund product innovation and expand its distribution.
Third-quarter net sales rose to $48.3 million, while the adjusted EBITDA loss narrowed to $900,000 from $1.7 million a year earlier. Both results exceeded management’s expectations, Chief Financial Officer Girish Satya said on the earnings call.
Satya said approximately 14 percentage points of the quarter’s sales growth came from volume and four points from pricing. Sell-through during a national club-channel rotation and digital sales were stronger than anticipated, while the company did not need to increase promotions as much as it had expected.
Higher outlook and lower cost expectations
Zevia raised its 2026 net sales guidance to $177 million to $179 million, representing approximately 10% growth at the midpoint. Its revised adjusted EBITDA outlook calls for a result between break-even and a $400,000 loss.
The updated profitability forecast includes approximately $8.5 million in incremental fuel and aluminum costs, down from a prior estimate of $11 million. Satya said third-quarter fuel costs were approximately $900,000 lower than initially expected.
For the fourth quarter, Zevia expects net sales of $37.5 million to $39.5 million and an adjusted EBITDA loss of $500,000 to $900,000. Satya said the guidance accounts for potential retailer changes to shipment timing and inventory levels during what is typically the company’s seasonally slowest quarter.
Third-quarter gross margin increased to 46.4% from 45.6% a year earlier. The prior-year quarter included an $800,000 inventory write-down associated with a packaging redesign, while the latest period was affected by higher aluminum costs.
Investment to support new products
Zevia closed a $20 million growth equity investment from GP Investments after the quarter ended. It had approximately $29.5 million in cash and cash equivalents at quarter-end, plus an undrawn $20 million revolving credit line. Following the investment, Satya said the company would have approximately $50 million in cash on hand.
President and CEO Alexandre Ruberti said Zevia plans to introduce two to three products outside traditional carbonated soft drinks digitally in the second half of 2027, with a full rollout planned for 2028. The company is already testing one or two products and sees opportunities in functional and wellness beverages, he said.
Satya said the company expects the new products to carry higher gross margins than its current offerings, but will spend more on marketing and launch support in the short term. Zevia also expects $3 million to $5 million in additional cost savings beginning in the first quarter of 2027, which it plans to reinvest in its strategic reset.
Retail expansion and marketing
Zevia is preparing test programs at Target and Sam’s Club. A limited-edition offer is scheduled to receive end-cap placement in more than 900 Target stores beginning in February, while a three-month Sam’s Club rotation is set to begin in March across 80 locations. Ruberti also said another Costco rotation had been confirmed.
The company plans to begin rolling out more single-serve products in the first quarter, supported by merchandising, promotions and cold placement. Ruberti described singles as an entry point for new customers and said 2027 would be a year to prove the format before a faster rollout.
Zevia is also investing in its Western direct-store-delivery network and third-party merchandising support outside that network. A new partnership with Dot Foods is intended to expand its reach into food service and other nontraditional channels.
On marketing, Ruberti said the initial awareness phase of Zevia’s Cardi B campaign generated more than 1.8 billion impressions and over 70,000 email signups. A flavor collaboration is planned for January. He said it was too early to quantify the campaign’s effect on conversion and retail sales velocity.
About Zevia PBC (NYSE:ZVIA)
Zevia PBC is a beverage company that develops and markets zero-sugar, zero-calorie drinks made without artificial sweeteners. Its portfolio is centered on Zevia Soda, a line of naturally sweetened carbonated soft drinks available in flavors such as cola, citrus, root beer and ginger ale.
The company also offers Zevia Energy drinks and other beverage products designed for consumers seeking alternatives to traditional soft drinks. Zevia products use plant-based sweeteners, including stevia, and are generally positioned as beverages with simple ingredients and no artificial colors.
Founded in 2007, Zevia sells its products primarily in the United States and Canada through grocery stores, mass merchants, warehouse clubs, natural and specialty retailers, convenience stores, online channels and food-service distributors.
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