Celsius Holdings, Inc.: Form 10-Q for the period ended Sep 30, 2025

When used in this Quarterly Report, unless otherwise indicated, the terms the “Company,” “Celsius,” “we,” “us” and “our” refer to

Celsius Holdings, Inc. and its consolidated subsidiaries.

Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report contains forward-looking statements that are based on the current expectations of our Company and management

about future events within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 27A of the

Securities Act, and Section 21E of the Exchange Act, and are made in reliance of the safe harbor protections provided thereunder. While

we have specifically identified certain information as being forward-looking in the context of its presentation, we caution you that all

statements contained in this Quarterly Report that are not clearly historical in nature are forward looking. They inherently involve risks

and uncertainties that could cause actual results to differ materially from those predicted in any such forward-looking statement. Such

risks and uncertainties include, but are not limited to: our ability to successfully integrate Alani Nu and Rockstar; the strategic

investment by and long term partnership with Pepsi; anticipated financial performance; management’s plans and objectives for

international expansion and future operations globally; the successful development, commercialization, and timing of new products;

business prospects; outcomes of regulatory proceedings; market conditions; the current and future market size for existing or new

products; and any stated or implied outcomes with regards to the foregoing.

Without limiting the generality of the preceding sentences, any time we use the words “expects,” “intends,” “will,” “anticipates,”

“believes,” “confident,” “continue,” “propose,” “seeks,” “could,” “may,” “should,” “estimates,” “forecasts,” “might,” “goals,”

“objectives,” “targets,” “planned,” “projects,” and, in each case, their negative or other various or comparable terminology, and similar

expressions, we intend to clearly express that the information deals with possible future events and is forward-looking in nature.

However, the absence of these words or similar expressions does not mean that a statement is not forward-looking. Particular

uncertainties that could cause our actual results to be materially different than those expressed in our forward-looking statements include,

without limitation:

• Our ability to accurately estimate the termination fees payable to former distributors in connection with the A&R U.S.

Distribution Agreement;

• Our ability to successfully execute our responsibilities under our Captaincy with Pepsi;
• The potential for brand dilution or cannibalization within Celsius’s brand portfolio;
• The increased ownership stake and additional board representation by Pepsi may allow it to exert greater influence over

our strategic and governance decisions;

• Our ability to successfully integrate Alani Nu, Rockstar or other businesses that we may acquire;
• Our ability to achieve the benefits that we expect to realize as a result of the Alani Nu Acquisition, Rockstar Acquisition

or other businesses that we may acquire;

• The potential negative impact that we could realize as a result of the Alani Nu Acquisition, Rockstar Acquisition or other

businesses that we may acquire;

• Liabilities of Alani Nu, Rockstar or other businesses that we may acquire that are not known to us;
• Our ability to maintain a strong relationship with Pepsi or any of our other distributors;
• The impact of the consolidation of retailers, wholesalers and distributors in the industry;
• Our reliance on key distributor partnerships;
• Our ability to maintain strong relationships with co-packers to manufacture our products;
• Our ability to maintain strong relationships with our customers;
• Our failure to accurately estimate demand for our products;
• The impact of increases in cost or shortages of raw materials or increases in costs of co-packing;
• Our ability to successfully achieve the benefits of our acquisition of Big Beverages, a co-packer;
• Our ability to successfully estimate and/or generate demand through the use of third-parties, including celebrities, social

media influencers, and others, may expose us to risk of negative publicity, litigation, and/or regulatory enforcement

action;

• The impact of additional labeling or warning requirements or limitations on the marketing or sale of our products;
• Our ability to successfully expand outside of the U.S. and the impact of U.S. and international laws, including export and

import controls and other risk exposure;

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• Our ability to successfully complete or manage strategic transactions, successfully integrate and manage our acquired

businesses, brands or bottling operations, or successfully realize a significant portion of the anticipated benefits of our

joint ventures or strategic relationships;

• Our ability to protect our brand, trademarks, proprietary rights, and our other intellectual property;
• The impact of internal and external cyber-security threats and breaches;
• Our ability to comply with data privacy and personal data protection laws;
• Our ability to effectively manage future growth;
• The impact of global or regional catastrophic events on our operations and ability to grow;
• The impact of any actions by the U.S. Food and Drug Administration regarding the manufacture, composition/ingredients,

packaging, marketing/labeling, storage, transportation, and/or distribution of our products;

• The impact of any actions by the Federal Trade Commission on our advertising;
• Our ability to effectively compete in the functional beverage product industry and the strength of such industry;
• The impact of changes in consumer product and shopping preferences;
• The impact of changes in government regulation and our ability to comply with existing regulation concerning energy

drinks;

• Compliance with California’s climate disclosure laws may subject us to increased regulatory scrutiny, potential penalties

and legal risks, which could adversely affect the our operations, financial condition and reputation;

• Other statements regarding our future operations, financial condition, prospects and business strategies; and
• Those factors contained in this Quarterly Report under the heading, "Risk Factors".

Forward-looking statements and information involve risks, uncertainties and other factors that could cause actual results to differ

materially from those expressed or implied in, or reasonably inferred from, such statements, including without limitation, the risks and

uncertainties disclosed or referenced in Part I, Item 1A Risk Factors of our Annual Report. Therefore, caution should be taken not to

place undue reliance on any such forward-looking statements. Much of the information in this Quarterly Report that looks toward future

performance is based on various factors and important assumptions about future events that may or may not actually occur. As a result,

our operations and financial results in the future could differ materially and substantially from those we have discussed in the forward-

looking statements included in this Quarterly Report. We assume no obligation (and specifically disclaim any such obligation) to

publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as

required by law.

Our Business

Executive-Level Overview

Celsius is a functional energy drink company operating in the U.S. and internationally. We currently market three brands within our

portfolio: CELSIUS®, our flagship functional energy brand; Alani Nu, a wellness-focused energy and nutritional product brand acquired

in April 2025; and Rockstar, a classic energy drink with a rich brand heritage acquired in August 2025. Together, these brands position

us to serve a broad and growing base of consumers seeking functional performance, better-for-you formulations and active lifestyle

support.

Celsius is available in two convenient forms: ready-to-drink and an on-the-go powder form. Additionally, we offer our CELSIUS

ESSENTIALS™ line, featuring 16-ounce cans enriched with aminos. In 2025, we introduced CELSIUS® Hydration, a line of non-

caffeinated, zero-sugar hydration powders, featuring electrolytes in a variety of fruit-forward flavors. Our product range is widely

available across the U.S. and in select territories in Canada in various retail outlets, including grocery stores, natural product stores,

convenience stores, fitness centers, mass retailers, vitamin specialty stores and through e-commerce platforms. Moreover, our products

are offered in select markets in Europe, the Middle East and the Asia-Pacific region as we have continued to expand our global presence.

Alani Nu expands our reach beyond energy into wellness and nutrition with a product range spanning energy drinks, pre-workout

formulas, protein beverages and supplements. With a strong following among Gen Z and female consumers, Alani Nu adds depth to our

innovation pipeline and provides meaningful opportunities for global expansion.

Through our addition of Rockstar, we also participate in the classic energy segment, offering beverages in both full-sugar and zero-sugar

formats. Rockstar complements our portfolio with its established brand equity and appeal to traditional energy drink consumers.

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Collectively, our brands position Celsius to meet the diverse preferences of consumers seeking functional performance, wellness benefits

and better-for-you energy options.

We engage in various aspects of developing, manufacturing, processing, marketing, selling, and distributing Celsius, Alani Nu and

Rockstar products. Our operational model strategically relies primarily on co-packers for the manufacture and supply of our products,

leveraging their specialized expertise and scalable production capabilities. Additionally, we utilize our in-house manufacturing facility to

complement our strategic use of co-packers. This approach allows us to maintain flexibility in responding to market demands and to

focus our resources on innovation, marketing, and expanding our distribution channels. We continuously assess and work to optimize our

supply chain to ensure quality, consistency and timely delivery to our customers.

On August 28, 2025, building on the long-term distribution agreement originally established with Pepsi in August 2022, we entered into

a series of transactions that expanded our strategic partnership. These included (i) the Rockstar Acquisition, (ii) the issuance of Series B

Preferred Stock and amendment of the existing Series A Preferred Stock, and (iii) the execution of the A&R U.S. Distribution

Agreement, which designates Pepsi as the primary distributor of our Alani Nu and Rockstar products in the U.S. (excluding Puerto Rico

and the U.S. Virgin Islands) and Canada. Under the enhanced commercial arrangement, Pepsi has agreed to use its commercially

reasonable efforts to sell and distribute our full portfolio of products in accordance with the Captaincy.

Impact of Tariffs and Macroeconomic Trends

The imposition of tariffs including U.S. tariffs imposed or threatened to be imposed on other countries and any tariffs imposed by such

countries have impacted and could continue to impact our supply chain, including the cost of certain raw materials and packaging. In

addition, any supply chain constraints, inflationary impacts or reduced consumer demand for our products as a result of such tariffs or

ongoing macroeconomic uncertainty could impact our results. The rapidly changing nature of global trade policies and tariff regulations

introduces uncertainty, making it difficult to reasonably estimate potential future impacts from such policies and regulations.

Impact of One Big Beautiful Bill Act

On July 4, 2025, the OBBBA was signed into law in the U.S. The legislation introduced a wide array of changes to the U.S. corporate tax

system, including permanent extensions of certain provisions of the Tax Cuts and Jobs Act of 2017 and substantial modifications to the

international tax regime applicable to U.S. multinational corporations. Key international provisions include changes to the Global

Intangible Low-Taxed Income regime, the treatment of foreign tax credits, and interest expense limitations under Section 163(j). While

certain provisions take effect in 2025, others are phased in over subsequent years. The OBBBA did not materially impact our estimated

annual effective tax rate as of September 30, 2025.

Interest Rate Risk

Fluctuations in market interest rates may cause future cash flows to vary. Interest rates are highly sensitive to many factors, including

fiscal and monetary policies and domestic and international economic and political considerations, as well as other factors beyond our

control. This can affect both our borrowing costs and the fair value of our debt obligations. We are subject to interest rate risk in

connection with the term loan facility, which bears interest at variable rates based on benchmark reference rates plus a fixed margin. For

additional information see Note 6. Debt in the notes to the condensed consolidated financial statements included in this Quarterly Report.

Results of Operations

Three months ended September 30, 2025 compared to three months ended September 30, 2024

Revenue

For the three months ended September 30, 2025, revenue was approximately $725.1 million, an increase of $459.4 million, or 172.9%,

from $265.7 million for the three months ended September 30, 2024.

For the three months ended September 30, 2025, revenue in North America increased by $454.9 million, or 184.1%, compared to the

three months ended September 30, 2024. The increase was primarily attributable to the Alani Nu Acquisition, which contributed

approximately $332.0 million of revenue, reflecting the impact of limited-time offer programs and an overall strong organic

performance. In addition, higher Celsius brand revenue reflected continued distribution gains and improved scanner trends. Celsius brand

results also benefited from lower revenue comparables in the third quarter of 2024, which was adversely impacted by inventory timing

and reduced sell-in to our largest distributor; however, this favorable comparison was tempered as distributor inventory levels, while

higher than the prior-year period, remained below historical levels. Gains for the Celsius brand were partially offset by the timing of

promotional expenses during the quarter, which negatively impacted revenue.

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European revenue for the three months ended September 30, 2025 was approximately $17.7 million, representing an increase of $1.4

million, or 8.9%, from the three months ended September 30, 2024. Asia-Pacific revenue generated approximately $3.5 million for the

three months ended September 30, 2025, with other international markets contributing an additional $1.9 million in revenue for the three

months ended September 30, 2025. The international markets continued to expand during the quarter, driven by recent market launches

and continued investment in distribution, marketing, and strategic partnerships to support long-term growth.

The following table sets forth the amount of revenue by geographical location for the three months ended September 30, 2025 and

September 30, 2024:

(Amounts in thousands)

Gross Profit

For the three months ended September 30, 2025, gross profit increased by $250.1 million to $372.3 million, an increase of 204.6% from

$122.2 million for the three months ended September 30, 2024. This increase was driven primarily by the Alani Nu Acquisition. Gross

profit margin was 51.3% for the three months ended September 30, 2025 and 46.0% for the three months ended September 30, 2024.

This margin improvement was primarily driven by lower net portfolio promotional spend, pack mix, favorable channel mix, scale

benefits on raw materials from higher volume, negative impacts from tariffs and the impact of comparatively lower margin contributions

from Alani Nu and Rockstar.

Selling, General and Administrative Expenses

Selling, general and administrative expenses for the three months ended September 30, 2025 were $205.6 million, an increase of

$80.2 million, or 64.0%, from $125.4 million for the three months ended September 30, 2024.

The change in selling, general and administrative expenses included:

An increase of $47.9 million in marketing and selling expense. This increase was primarily due to:

• $19.3 million attributable to Alani Nu, primarily related to sales and marketing employee costs, marketing investments to

support brand growth, and storage and distribution expenses associated with the brand’s commercial expansion;

• $17.8 million in marketing expenses, primarily attributable to the ongoing "Live. Fit. Go." campaign, our largest

marketing initiative to date, designed to support long-term brand development;

• $4.8 million in employee-related costs, primarily reflecting the expansion of our workforce through continued investment

in sales and marketing personnel to support our strategic growth initiatives; and

• $6.0 million in other selling expenses, including storage and distribution costs associated with expanded sales volume and

channel growth.

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An increase of $32.3 million in administrative expenses. This increase was primarily due to:

• $15.3 million in acquisition and integration-related costs, primarily consisting of legal and professional service fees

incurred in connection with the Rockstar Acquisition and Alani Nu Acquisition and their subsequent integration;

• $12.5 million attributable to Alani Nu, primarily related to administrative employee costs, amortization of intangible

assets, and other general administrative expenses; and

• $4.5 million in other administrative expenses, including administrative employee related costs, amortization of

intangibles, and stock-based compensation.

Distributor Termination Fees

In addition to the selling, general and administrative expense changes described above, we also incurred termination fees of $246.7

million for the three months ended September 30, 2025, due to the termination of certain former Alani Nu distributors. There were no

such expenses in the comparable period in 2024.

Other (Expense) Income

Total other expense for the three months ended September 30, 2025 was $8.0 million compared to other income of $11.4 million for the

three months ended September 30, 2024, reflecting an unfavorable change of $19.4 million. This increase in other expense was primarily

driven by $18.2 million of interest expense related to our outstanding debt, whereas no such debt existed in the prior-year interim period.

Additionally, interest income decreased compared to the prior period, partially offset by income recognized in connection with Rockstar.

Provision for Income Taxes

In general, the Company uses an estimated annual effective tax rate, which is based on expected annual income and statutory tax rates in

the various jurisdictions in which it operates, to determine its quarterly provision for income taxes. Certain discrete items are recognized

separately in the quarter in which they occur and may cause variability in the effective tax rate from quarter to quarter. The Company’s

effective tax rate may change from period to period due to recurring and nonrecurring factors, including the geographic mix of earnings,

enacted tax legislation, and state and local income taxes.

For the three months ended September 30, 2025, the Company’s effective tax rate was 30.7%, reflecting a tax benefit, compared to

22.3%, reflecting a tax expense, for the same period in 2024. The higher effective tax rate for the current quarter, which contributed to a

greater income tax benefit, primarily reflects the favorable impact of distributor termination expenses on state income taxes and higher

tax benefits from foreign operations included in the Company’s forecasted annual effective tax rate, partially offset by income tax

expense associated with stock-based compensation shortfalls and other non-deductible items. The current period’s effective tax rate

exceeded the U.S. federal statutory rate of 21.0%, primarily due to the aforementioned effects of distributor termination expenses and

state income taxes on the Company’s forecasted annual effective tax rate. In the prior-year quarter, the effective tax rate exceeded the

statutory rate primarily due to disallowed stock-based compensation expense and state income taxes.

We are subject to U.S. federal income tax as well as income tax in multiple state and foreign jurisdictions. Our tax returns for tax years

beginning 2020 remain subject to potential examination by the taxing authorities.

Net (Loss) Income Attributable to Common Stockholders

Net loss attributed to common stockholders for the three months ended September 30, 2025 was $70.7 million, representing basic loss

per share of $(0.27) based on a basic weighted average of 257.8 million shares outstanding. In comparison, for the three months ended

September 30, 2024 our net loss attributed to common stockholders was $0.6 million, representing basic loss per share of $(0.00) based

on a weighted average of 233.7 million shares outstanding. Diluted loss per share was $(0.27) and $(0.00) for the three months ended

September 30, 2025 and 2024, respectively. The increase in net loss attributable to common stockholders for the three months ended

September 30, 2025 was primarily driven by distributor termination fees incurred in connection with transitioning Alani Nu to the Pepsi

distribution network, higher selling, general and administrative expenses and interest expense related to the debt issued in the second

quarter of 2025. These unfavorable factors were partially offset by positive net income generated by Alani Nu. The results for the three

months ended September 30, 2025 also benefited from comparison to a softer prior-year period, when Pepsi’s inventory optimization

negatively impacted our results.

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Nine months ended September 30, 2025 compared to Nine months ended September 30, 2024

Revenue

For the nine months ended September 30, 2025, revenue was approximately $1,793.6 million, an increase of $770.2 million, or 75.3%,

from $1,023.4 million for the nine months ended September 30, 2024.

For the nine months ended September 30, 2025, revenue in North America increased by $754.0 million, or 77.8%, compared to the nine

months ended September 30, 2024. The increase was driven primarily by the Alani Nu Acquisition, which contributed approximately

$633.2 million following the acquisition. The remainder of the growth reflected higher revenue for the Celsius brand, which increased

12.5% compared to the prior-year period, from expanded distribution, new product innovation and broader brand awareness. The year to

date comparison for the Celsius brand also benefited from lower revenue in the third quarter of 2024, when Pepsi's inventory

optimization reduced sell-in while promotional programs remained active.

European revenues for the nine months ended September 30, 2025 were approximately $54.7 million, representing an increase of $7.6

million, or 16.1%, from the nine months ended September 30, 2024. Asia-Pacific revenues generated approximately $10.1 million for the

nine months ended September 30, 2025, with other international markets contributing an additional $5.9 million in revenue for the nine

months ended September 30, 2025. The international markets continued to expand during the quarter, driven by recent market launches

and continued investment in distribution, marketing, and strategic partnerships to support long-term growth.

The following table sets forth the amount of revenues by geographical location for the nine months ended September 30, 2025 and

September 30, 2024:

(Amounts in thousands)

Gross Profit

For the nine months ended September 30, 2025, gross profit increased by $412.0 million to $925.5 million, an increase of 80.2%, from

$513.5 million for the nine months ended September 30, 2024. Gross profit margin increased to 51.6% for the nine months ended

September 30, 2025 from 50.2% for the nine months ended September 30, 2024. This gross profit margin increase was primarily driven

by lower net portfolio promotional spend, favorable channel, price and pack mix which were partially offset by the impact of

comparatively lower margin contributions from Alani Nu and Rockstar and inventory valuation step-up adjustments following our

acquisitions.

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Selling, General and Administrative Expenses

Selling, general and administrative expenses for the nine months ended September 30, 2025 were $563.8 million, an increase of

$224.5 million, or 66.2%, from $339.3 million for the nine months ended September 30, 2024.

The change in selling, general and administrative expenses included:

An increase of $110.9 million in administrative expenses. This increase was primarily due to:

• $40.4 million in acquisition and integration-related costs, primarily consisting of legal and professional service fees

incurred in connection with the Alani Nu Acquisition and the Rockstar Acquisition and the integration of those businesses

into our operations;

• $28.3 million attributable to Alani Nu, primarily related to administrative employee costs, amortization of intangible

assets, and other general administrative expenses;

• $16.4 million in other administrative expenses, including depreciation, amortization of intangibles, and stock-based

compensation;

• $13.8 million due to the remeasurement of contingent consideration related to the Alani Nu Acquisition, reflecting

stronger-than-expected revenue performance and an upward revision to forecasted results; and

• $12.0 million in general administrative costs, including legal, consulting, and other professional service expenses.

An increase of $113.6 million in marketing and sales expenses. This increase was primarily due to:

• $49.0 million attributable to Alani Nu, primarily related to sales and marketing employee costs, marketing investments to

support brand growth, and storage and distribution expenses associated with the brand’s commercial expansion;

• $38.1 million in marketing expense, reflecting continued execution of the "Live. Fit. Go." campaign, which launched

earlier in the year and remained our largest marketing initiative to date;

• $15.9 million in employee-related costs, primarily reflecting the expansion of our workforce through continued

investment in sales and marketing personnel to support our strategic growth initiatives; and

• $10.6 million in other selling expenses, including storage and distribution costs associated with expanded sales volume

and channel growth.

Distributor Termination Fees

In addition to the selling, general and administrative expense changes discussed above, we also incurred termination fees of $246.7

million for the nine months ended September 30, 2025 due to the termination of certain former Alani Nu distributors. There were no

such expenses in the comparable period in 2024.

Other (Expense) Income

Total other expense was $12.6 million for the nine months ended September 30, 2025, compared to other income of $31.0 million for the

nine months ended September 30, 2024, reflecting an unfavorable change of $43.6 million. This change was primarily driven by

$36.3 million of interest expense recognized in 2025 related to our outstanding debt, whereas no such debt existed in the prior-year

period. Additionally, interest income decreased compared to the prior period, partially offset by income recognized in connection with

Rockstar.

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Provision for Income Taxes

For the nine months ended September 30, 2025, our effective tax rate was 18.7%, as compared to 20.1% for the same period in 2024.

The decrease was primarily driven by deferred state income tax benefits arising from distributor termination expenses, combined with

favorable tax benefits from foreign operations. These factors were partially offset by income tax expense related to stock award shortfalls

and non-deductible expenses associated with the issuance of stock-based compensation. The effective tax rate for the current period was

below the U.S. federal statutory rate of 21.0%, primarily due to the deferred state income tax benefits recognized in connection with

distributor termination expenses, as well as favorable foreign tax impacts. The prior-year effective tax rate was also below the statutory

rate, primarily reflecting windfall benefits from stock-based compensation, partially offset by disallowed stock-based compensation

expenses and state income taxes.

We are subject to U.S. federal income tax as well as income tax in multiple state and foreign jurisdictions. Our tax returns for tax years

beginning 2020 remain subject to potential examination by the taxing authorities.

Net Income Attributable to Common Stockholders

Net income attributed to common stockholders for the nine months ended September 30, 2025 was $54.7 million, representing basic

earnings per share of $0.22 based on a basic weighted average of 250.3 million shares outstanding. In comparison, for the nine months

ended September 30, 2024 our net income attributed to common stockholders was $131.0 million, representing basic earnings per share

of $0.56 based on a weighted average of 233.2 million shares outstanding. Diluted earnings per share was $0.22 and $0.55 for the nine

months ended September 30, 2025 and 2024, respectively. The decrease in net income attributable to common stockholders for the nine

months ended September 30, 2025 was primarily driven by distributor termination fees incurred in connection with transitioning Alani

Nu distribution to the Pepsi distribution network, higher selling, general and administrative expenses, and interest expense related to

newly incurred debt. These unfavorable factors were offset by positive net income from the Alani Nu Acquisition and interest income

from our money market accounts.

Liquidity and Capital Resources

General

As of September 30, 2025, we had unrestricted cash and cash equivalents of approximately $806.0 million, restricted cash of $126.5

million and net working capital of $912.6 million.

Our primary sources of liquidity are cash flows from operations and our existing cash balances. We believe that cash available from

operations, together with our $100.0 million Revolving Credit Facility, will be sufficient for our working capital needs, including

purchase commitments for raw materials and inventory, increases in accounts receivable and other assets, and purchases of capital assets

and equipment for the next twelve months and beyond.

Purchases of inventories, increases in accounts receivable and other assets, equipment purchases (including coolers), advances to certain

co-packers and distributors, and payments of accounts payable and income taxes are expected to remain our principal recurring uses of

cash and material cash requirements.

On April 1, 2025, we completed the Alani Nu Acquisition for total consideration comprising (i) $1,275.0 million in cash paid at closing,

subject to adjustment as set forth in the Membership Interest Purchase Agreement, (ii) an aggregate of 22,451,224 shares of our common

stock, and (iii) up to $25.0 million in additional cash consideration, payable only if revenue from Alani Nu’s products meets or exceeds

an agreed-upon target for 2025. Any such contingent consideration is expected to be paid in 2026. For the nine months ended September

30, 2025, we recorded a measurement period adjustment primarily related to property, plant and equipment for $2.9 million, and the total

cash consideration paid, net of cash received, is reflected in our cash flows from investing activities. For additional information, see Note

5. Acquisitions in the notes to the condensed consolidated financial statements.

In connection with our Alani Nu Acquisition, we, together with certain of our subsidiaries as guarantors, the lenders and issuing banks

from time to time party thereto and UBS AG, Stamford Branch, as administrative agent and collateral agent, entered into the secured

Credit Agreement. The Credit Agreement provides for the Term Loan Facility in an aggregate principal amount of up to $900.0 million,

which was fully drawn to fund a portion of the purchase price for Alani Nu, and a Revolving Credit Facility in an aggregate principal

amount of up to $100.0 million, which may include the issuance of letters of credit in a stated face amount of up to, but not exceeding,

$50.0 million. The Term Loan Facility matures on April 1, 2032, and the Revolving Credit Facility matures on April 1, 2030. For

additional information see Note 6. Debt in the notes to the condensed consolidated financial statements.

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On October 2, 2025, subsequent to the end of the reporting period, Celsius Holdings, Inc. and Celsius, Inc. entered into the First

Refinancing Amendment. This amendment reduced the applicable interest rates under both the Term Loan Facility and the Revolving

Credit Facility by 0.75%. All other material terms of the Credit Agreement remained unchanged. In connection with the First

Refinancing Amendment, we repaid the remaining outstanding balance of our $900.0 million term loan facility using a combination of

approximately $198.8 million of cash on hand and the proceeds from a new $700.0 million term loan under the Term Loan Facility,

which bears interest at the reduced interest rate provided in the First Refinancing Amendment. No prepayment penalties were incurred in

connection with the refinancing.

Cash flows for the nine months ended September 30, 2025 and 2024

Cash flows provided by operating activities

Cash flows provided by operating activities totaled $478.9 million for the nine months ended September 30, 2025, which compares to

$187.2 million cash provided by operating activities for the nine months ended September 30, 2024. The $291.7 million increase was

primarily driven by strong operational performance, including the addition of net income and revenue from Alani Nu and higher

accounts payable and accrued liabilities resulting from the timing of payments. The increase also reflects cash received from Pepsi

related to the termination of existing Alani Nu distributors under the A&R U.S. Distribution Agreement, which had not yet been paid to

terminated distributors as of September 30, 2025.

Cash flows used in investing activities

Cash flows used in investing activities totaled $1,278.7 million for the nine months ended September 30, 2025, compared to cash used in

investing activities of $21.0 million for the nine months ended September 30, 2024. The $1,257.7 million increase was primarily

attributable to cash paid as part of the Alani Nu Acquisition as well as increased capital expenditures related to investment in machinery

and equipment at our wholly owned manufacturing facility, Big Beverages. For more information, see Note 5. Acquisitions in the notes

to the condensed consolidated financial statements.

Cash flows provided by financing activities

Cash flows provided by financing activities totaled $839.9 million for the nine months ended September 30, 2025, compared to $18.5

million cash flows used in financing activities for the same period in 2024, representing an $858.4 million increase. The increase was

primarily driven by debt incurred in connection with the Alani Nu Acquisition whereas no such debt existed in prior year. For more

information, see Note 6. Debt in the notes to the condensed consolidated financial statements.

Off Balance Sheet Arrangements

As of September 30, 2025 and December 31, 2024, we had no off balance sheet arrangements.

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Critical Accounting Policies and Estimates

Our condensed consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United

States of America, which requires us to make estimates and assumptions that affect the reported amounts in our condensed consolidated

financial statements. Critical accounting estimates are those that management believes are the most important to the portrayal of our

financial condition and results and require the most difficult, subjective or complex judgments, often as a result of the need to make

estimates about the effect of matters that are inherently uncertain and that have had, or are reasonably likely to have, a material impact on

our financial condition or results of operations. Judgments and uncertainties may result in materially different amounts being reported

under different conditions or using different assumptions. Except for those described below, there have been no material changes to our

critical accounting policies or estimates from those described in Part II, Item 7, Management's Discussion and Analysis of Financial

Condition and Results of Operations included in our Annual Report.

Business Combinations

We account for acquisitions using the acquisition method, under which, upon obtaining control, we recognize each identifiable asset

acquired and liability assumed at its acquisition date fair value. The determination of those fair values requires significant judgment and

the use of valuation techniques when observable market inputs are unavailable. We value intangible assets using models such as the

income approach (relief-from-royalty model) and other cost-based techniques. Key unobservable inputs include but are not limited to

forecasted revenue growth rates, discount rates, royalty rates and estimated useful lives. We engage third-party valuation specialists to

review these critical assumptions and prepare detailed fair value analyses for material acquisitions.

Any excess of the purchase consideration over the fair values of identifiable net assets is recorded as goodwill. During the measurement

period, up to one year from the acquisition date, significant provisional amounts are adjusted with a corresponding offset to goodwill.

Preferred Stock

On the Closing Date of the Pepsi Transactions, we measured the fair value of our Preferred Stock using a Monte Carlo simulation

because these instruments include path dependent features, multiple redemption and conversion decision dates, an automatic conversion

and a 10-day VWAP test. The model used observable market data at the measurement date, such as the price of our common stock. Since

the valuation required significant unobservable inputs, including the probability of meeting certain triggering conditions, equity volatility

and discount rates for redemption cash flows, the measurement is classified within Level 3 of the fair value hierarchy.

We engaged third-party valuation specialists to review these critical assumptions and prepare detailed fair value analyses for our

Preferred Stock. Key assumptions included the probability of meeting triggering conditions, equity volatility, the time horizon to

decision dates and discount rates. These estimates were judgmental and could materially affect results.

Commodity Price Risk

In the normal course of business, our financial position is routinely subject to a variety of risks. The principal market risks (i.e., the risk

of loss arising from adverse changes in market rates and prices) to which we are exposed are fluctuations in commodity and other input

prices affecting the costs of our raw materials (including, but not limited to, increases in the costs of the price of aluminum cans,

sucralose and other sweeteners, as well as other raw materials contained within our products). We do not currently use hedging

agreements or other financial instruments to manage the risks associated with securing sufficient ingredients or raw materials, although

we may consider doing so in the future as part of our risk management strategy. We are also subject to market risks with respect to the

cost of commodities and other inputs because our ability to recover increased costs through higher pricing is limited by the competitive

environment in which we operate.

Interest Rate Risk

We may be subject to market risk from exposure to changes in interest rates based on our financing, investing, and cash management

activities. As of September 30, 2025, the interest rate on our $897.8 million term loan incurred in connection with the Alani Nu

Acquisition was 7.29%. Based on the outstanding balances as of September 30, 2025, if our applicable interest rate increased by 1%,

then our debt service on an annual basis would increase by approximately $8.8 million. For more information, see Note 6. Debt in the

notes to the condensed consolidated financial statements.

We do not use derivative financial instruments to protect ourselves from fluctuations in interest rates.

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Except as described herein, there have been no material changes to the information regarding market risk provided in Item 7A.

Quantitative and Qualitative Disclosures about Market Risk contained in our Annual Report.

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) are designed to ensure that

information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is recorded, processed,

summarized and reported within the time periods specified in the rules and forms adopted by the SEC. These controls also ensure that

information required to be disclosed in the reports that are filed or submitted under the Exchange Act are accumulated and

communicated to the Company’s management, including our Chief Executive Officer (our principal executive officer) and our Chief

Financial Officer (our principal financial and accounting officer), or persons performing similar functions, as appropriate, to allow timely

decisions regarding required disclosure.

Our Chief Executive Officer, as well as our Chief Financial Officer, evaluated the effectiveness of the design and operation of our

disclosure controls and procedures as of September 30, 2025. Based on that evaluation, our Chief Executive Officer and our Chief

Financial Officer concluded that our disclosure controls and procedures were effective as of such date.

On April 1, 2025, we completed the Alani Nu Acquisition. In accordance with interpretive guidance issued by the SEC staff,

management is permitted to exclude an acquired business from its assessment of internal control over financial reporting in the first year

post-acquisition. Given the overlapping nature of internal controls and disclosure controls and procedures, we have excluded the portion

of disclosure controls and procedures that are subsumed within the internal control over financial reporting of Alani Nu from

management's evaluation of our disclosure controls and procedures as of September 30, 2025.

Alani Nu, excluding the effects of purchase accounting, represented approximately 12.6% of our consolidated total assets as of

September 30, 2025 and 35.3% of consolidated revenue for the nine months ended September 30, 2025. We will include Alani Nu in our

assessment of internal controls over financial reporting and disclosure controls and procedures no later than the first anniversary of the

acquisition date, as required.

On August 28, 2025, we completed the Rockstar Acquisition. In accordance with interpretive guidance issued by the SEC staff,

management is permitted to exclude an acquired business from its assessment of internal control over financial reporting in the first year

post-acquisition. Given the overlapping nature of internal controls and disclosure controls and procedures, we have excluded the portion

of disclosure controls and procedures that are subsumed within the internal control over financial reporting of Rockstar from

management's evaluation of our disclosure controls and procedures as of September 30, 2025.

Rockstar, excluding the effects of purchase accounting, represented approximately 0.5% of our consolidated total assets as of

September 30, 2025 and 0.7% of consolidated revenue for the nine months ended September 30, 2025. We will include Rockstar in our

assessment of internal controls over financial reporting and disclosure controls and procedures no later than the first anniversary of the

acquisition date, as required.

Changes in Internal Control Over Financial Reporting

Except as discussed above, there were no changes in our internal control over financial reporting (as defined in Exchange Act Rule

13a-15(f)) during the quarter ended September 30, 2025 that have materially affected, or are reasonably likely to materially affect, our

internal control over financial reporting.

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We face a variety of risks that are inherent in our business and our industry, including operational, legal, regulatory and product risks.

Such risks could cause our actual results to differ materially from our forward-looking statements, expectations and historical trends.

Except for the risks discussed elsewhere in this Quarterly Report, during the reporting period covered by this Quarterly Report, there

have been no material changes to our risk factors as set forth in Part I, Item 1A Risk Factors in our Annual Report.