How CELH (Celsius Holdings) Makes Money in 2025: A Deep-Dive With Income Statement

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Understanding how a beverage and energy drink company like Celsius Holdings (CELH) makes money is essential for investors and anyone interested in the business of functional beverages. In this post, we break down Celsius Holdings' quarterly income statement (Q2 2025) using a Sankey chart to visualize the financial flows — what comes in, where it goes, and what's left as profit.[1][2]

Quick Celsius Holdings Overview

Celsius Holdings operates in the rapidly growing functional beverage market, primarily producing and distributing energy drinks and performance beverages. The company's flagship Celsius brand has become a leading player in the fitness and wellness-focused energy drink segment. Revenue comes predominantly from the sale of Celsius energy drinks through various distribution channels, including retail stores, convenience stores, and online platforms. The company has experienced explosive growth as consumer demand for healthier, functional beverage alternatives continues to surge.

Revenue Breakdown

• Total Revenue (Q2 2025): $739.3M (+83.9% YoY)
  • Celsius' revenue nearly doubled year-over-year, demonstrating exceptional market demand and successful market penetration
  • Growth is powered by increased consumer adoption of functional beverages, expanded retail distribution, and strong brand momentum in the energy drink category

The dramatic 83.9% year-over-year revenue growth reflects Celsius Holdings' position as one of the fastest-growing beverage companies. This explosive expansion indicates robust demand for the company's products and successful execution of its distribution and marketing strategies.

Gross Profit and Margins

• Gross Profit: $380.9M (51.5% gross margin)
  • Cost of Revenue: $358.4M (+84.5% YoY)
  • Celsius maintains strong gross margins of 51.5%, which is robust for the beverage industry and reflects the company's pricing power and operational efficiency
• Most costs come from manufacturing, packaging, and distribution of beverages, which scale proportionally with production volume

The 51.5% gross margin demonstrates that Celsius retains approximately half of every revenue dollar after accounting for direct production costs. This healthy margin provides substantial room for operating expenses and profit generation, a key strength of the business model.

Operating Income and Expenses

• Operating Income: $143.0M (+51.7% YoY, 19.3% margin)
• Operating Expenses: $237.9M (+109.7% YoY)
  • SG&A (Sales, General & Administrative): $237.9M (+110.1% YoY, 32.2% of revenue)
  • Celsius continues to invest heavily in growth while managing operational efficiency, with SG&A expenses scaling with the company's rapid expansion

The operating expense growth of 109.7% outpaces revenue growth of 83.9%, indicating that Celsius is making strategic investments in sales, marketing, and administrative infrastructure to support its rapid expansion. This is typical for high-growth companies scaling their operations.

Net Income

• Pre-Tax Income: $129.5M (+23.7% YoY, 17.5% margin)
• Income Tax: $29.6M (22.9% effective tax rate)
• Net Income: $99.9M (+25.2% YoY, 13.5% net margin)
• Celsius converts a significant portion of sales into profit, with a 13.5% net margin reflecting strong operational leverage and the scalability of its business model

The 13.5% net margin is particularly impressive for a beverage company experiencing hypergrowth, indicating that despite aggressive investments in expansion, Celsius maintains strong bottom-line profitability. This demonstrates the fundamental strength of the business.

What Drives Celsius Holdings' Money Machine?

• Energy Drink Sales: The overwhelming majority of revenue comes from Celsius energy drink sales across multiple flavors and product lines
• Distribution Expansion: Rapid growth driven by expanding retail presence in major grocery chains, convenience stores, and online channels
• Brand Momentum: Strong consumer demand for functional, fitness-oriented beverages with clean ingredients and performance benefits
• Market Tailwinds: Growing consumer shift away from traditional sugary energy drinks toward healthier functional alternatives

Visualizing Celsius Holdings' Financial Flows

The Sankey chart below visualizes how each dollar flows from gross revenue, through costs and expenses, down to net income. This helps investors spot where value is created, what areas weigh on profits, and how efficiently the company operates.[1]

• Most revenue flows into gross profit at a healthy 51.5% rate, with cost of revenue consuming the remaining 48.5%
• Operating expenses, particularly SG&A spending at 32.2% of revenue, represent the largest deduction from gross profit
• Even after substantial investments in sales, marketing, and administrative functions, 13.5% of revenue drops to the bottom line as net income

The visualization demonstrates that Celsius operates an efficient business model where strong gross margins provide ample cushion for operating investments while still delivering meaningful profitability.

Key Takeaways

• Celsius Holdings' revenue comes overwhelmingly from energy drink sales, with 83.9% year-over-year growth demonstrating exceptional market demand
• Strong 51.5% gross margins illustrate the power of the company's branded beverage business model and pricing power
• Heavy investment in SG&A expenses (32.2% of revenue) reflects aggressive expansion of sales and marketing to capture market share
• Ongoing growth is driven by expanding distribution, brand momentum, and favorable consumer trends toward functional beverages
• The 13.5% net margin shows that despite rapid scaling, Celsius maintains strong profitability

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FAQ About Celsius Holdings' Income Statement

1. What is the main source of Celsius Holdings' revenue in 2025?

Celsius Holdings generates substantially all of its revenue from the sale of Celsius energy drinks and related functional beverages. The company's product portfolio focuses on fitness-oriented energy drinks marketed to health-conscious consumers seeking alternatives to traditional sugary beverages. Revenue growth of 83.9% year-over-year in Q2 2025 reflects strong consumer demand and successful market expansion.

2. How profitable is Celsius Holdings in Q2 2025?

Celsius Holdings reported net income of $99.9M in Q2 2025, with a net margin of approximately 13.5%, reflecting strong profitability driven by robust gross margins, operational leverage, and the scalability of the beverage business model. The 25.2% year-over-year growth in net income demonstrates improving profitability despite aggressive investments in expansion.

3. What are the largest expense categories for Celsius Holdings?

The biggest expenses on Celsius Holdings' income statement are operating expenses, particularly Sales, General & Administrative (SG&A) costs at $237.9M in Q2 2025, representing 32.2% of revenue. These expenses include marketing, sales commissions, distribution costs, and administrative overhead necessary to support the company's rapid growth and market expansion.

4. Why are operating expenses growing faster than revenue?

Operating expenses grew 109.7% year-over-year compared to revenue growth of 83.9%, indicating that Celsius is making strategic investments in sales, marketing, and infrastructure to support its hypergrowth trajectory. This is a deliberate choice by management to capture market share and expand distribution during a period of strong consumer demand, typical of high-growth companies in expansion mode.

5. How does Celsius Holdings' effective tax rate compare to previous years?

Celsius Holdings' effective tax rate in Q2 2025 was 22.9%, a reasonable rate that reflects the company's profitability and tax position. This moderate rate allows the company to retain a substantial portion of pre-tax income as net income, contributing to the strong 13.5% net margin.