Release Date: April 01, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Jones Soda Co (JSDA, Financial) reported a 15% increase in net revenue for 2024, reaching $19.1 million compared to $16.7 million in the prior year.
- The company saw strong growth in its hemp-derived HD9 products, generating $1.7 million in net revenues during 2024.
- Jones Soda Co (JSDA) expanded its distribution network to 81 partners, enhancing its presence in key national and regional retailers across 37 states.
- The company launched innovative products like zero colas and limited edition collaborations, such as the exclusive agreement with Crayola.
- Jones Soda Co (JSDA) is optimistic about the future of the functional soda segment, with new products like Popp Jones and Fiesta Jones gaining traction.
Negative Points
- Gross profit as a percentage of revenue decreased to 21.3% from 29.1% in the prior period, primarily due to a $1.2 million one-time inventory impairment charge.
- Total operating expenses increased significantly to $14 million in 2024 from $9.7 million in 2023, driven by higher selling and marketing expenses.
- The company reported a net loss of $9.9 million for 2024, up from a net loss of $4.9 million in 2023.
- Jones Soda Co (JSDA) faced operational challenges and poor financial discipline in the latter half of the year, impacting growth.
- The company experienced a decrease in adjusted EBITDA, which was negative $8.7 million compared to negative $4.6 million in the previous year.
Q & A Highlights
Q: With broader concerns about a slowdown in the economy, do you think you'll be able to accomplish your growth objectives if consumer spending continues to slow down or things get worse?
A: Scott Harvey, CEO: We understand the concerns around the broader economy, but we have not seen a material slowdown in our operating categories. We are confident in our growth opportunities and are actively working to improve our cost bases and supply chain to enhance our margin profile and manage our P&L effectively.
Q: How does Jones intend to navigate the shifting landscape of the HD9 playing field with many state attorney generals and congressional bodies taking steps to address this growing category?
A: Scott Harvey, CEO: We are closely monitoring the evolving regulatory landscape of the HD9 category. We are committed to ensuring compliance with all regulations and are proactively engaging with regulatory bodies to understand potential impacts on our business, allowing us to adapt our strategy as needed.
Q: What is the status of the Mary Jones launch in Michigan that was announced months ago? Are there any plans to expand into new states?
A: Scott Harvey, CEO: Mary Jones launched in Michigan during Q4 2024, and our sodas launched on March 12, 2025. The launch broke our distributor's record for all KPIs except average order value. We are evaluating several other states and plan to launch in additional high-value states in 2025.
Q: Where do you see the company in 5 years, and why should investors believe in this management team over the previous ones?
A: Scott Harvey, CEO: In 5 years, we envision Jones evolving into a full-fledged beverage company, expanding beyond core offerings to capture new markets. Our management team is committed to financial discipline and operational excellence, ensuring smarter investments, improved margins, and long-term profitability.
Q: Are you comfortable with your current liquidity position?
A: Brian Meadows, CFO: We secured a new $5 million credit facility in February 2025 to support our growth initiatives. This facility allows us to borrow off a larger base of assets, providing flexibility to capitalize on growth opportunities. We will seek the best capital sources if further expansion is needed.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
