Shares of energy drink company Celsius Holdings (NASDAQ: CELH) rose 74% in 2025, significantly outpacing the S&P 500's 16% gain. This followed a difficult 2024 when the stock fell 52%.
On December 22, 2024, an investor wrote that once growth numbers improved, investors could start believing in the long-term growth story again. Growth did pick back up in 2025, with the company reporting 75% top-line growth through the first three quarters.
In the third quarter of 2024, Celsius experienced its first year-over-year quarterly revenue decline in years. Management attributed this to inventory fluctuations with its largest distributor, PepsiCo. Investors reacted negatively, with many interpreting the 31% Q3 revenue drop as a sign of declining consumer interest.
However, market data showed Celsius' market share was increasing, products were getting greater distribution, and end-consumer sales volume remained strong. Management maintained the inventory issue was temporary and could be resolved.
On January 17, 2025, an investor bought more shares of Celsius stock, believing it would rebound. The stock did recover strongly throughout 2025.
Celsius acquired beverage brand Alani Nu for $1.65 billion in April 2025, contributing to growth. The company's namesake brand also performed well, with retail sales growing 13% year over year in the 13 weeks leading to September 28.
Alani Nu's third quarter net sales increased 115% year over year. The brand entered PepsiCo's distribution system after the quarter ended, which management expects will expand its reach and accelerate growth.
International expansion represents another growth opportunity for Celsius. Third quarter international revenue accounted for only 3% of total revenue, indicating significant potential for growth abroad.
The Motley Fool Stock Advisor analyst team recently identified what they believe are the 10 best stocks for investors to buy now, and Celsius was not among them. The team noted that when Netflix made their list in December 2004, a $1,000 investment would have grown to $474,578. When Nvidia made their list in April 2005, a $1,000 investment would have grown to $1,141,628.
Stock Advisor's total average return is 955%, compared to 196% for the S&P 500. Jon Quast has positions in Celsius. The Motley Fool has positions in and recommends Celsius.