Monster Beverage (NASDAQ:MNST) reported second-quarter earnings that fell short of analyst expectations, sending shares down 9% in after-hours trading.
The energy drink maker posted adjusted earnings per share of $0.41, missing the consensus estimate of $0.45. Revenue for the quarter came in at $1.90 billion, below analysts' projections of $2.02 billion but up 2.5% YoY.
Net sales for Monster's core energy drinks segment increased 3.3% to $1.74 billion. However, the company faced headwinds from unfavorable foreign exchange rates, which had a $67.7 million negative impact on overall net sales.
"The energy drink category in the United States and in certain other countries experienced lower growth rates in the second quarter," said Hilton H. Schlosberg, Vice Chairman and Co-Chief Executive Officer.
"Retailers have reported a reduction in convenience store foot traffic and we have seen a shift at retail towards more mass and dollar channels."
Despite the challenges, gross profit margins improved to 53.6% compared to 52.5% in the same quarter last year, driven by decreased freight costs and pricing actions in certain markets.
The company plans to implement a 5% price increase on its core brands and packages in the United States, effective November 1.
Monster Beverage's international sales grew 4.3% to $746.0 million, representing 39% of total net sales. On a foreign currency adjusted basis, international sales increased 13.7%.