Flow Beverage (FLOW) Q1 2025 earnings summary

Executive summary

• Net revenue for Q1 2025 increased 38% year-over-year to $11.4 million, driven by a 216% surge in co-pack revenue, while Flow brand revenue declined 5% due to exited unprofitable channels and production disruptions.

• Gross margin improved to 21% from negative 15% last year, reflecting operational efficiencies and a focus on higher-margin channels.

• Adjusted EBITDA loss narrowed to $2.6 million from $9.7 million year-over-year, with SG&A expenses down 35% to $5.5 million and G&A expenses halved.

• Operational milestones include partnerships with Inter Miami CF and Las Vegas Lights FC, and the addition of José Bautista as a strategic advisor and investor.

• Retail presence expanded to over 80,000 doors in North America.

Financial highlights

• Co-pack net revenue surged 216% to $5.2 million, offsetting a 5% decline in Flow brand net revenue to $6.2 million.

• Gross profit reached $2.4 million, reversing a loss of $(1.3) million in the prior year.

• Net loss for Q1 2025 was $8.4 million, a significant improvement from $15.4 million in Q1 2024.

• EBITDA loss for Q1 was $4.6 million, compared to $10.9 million in the prior year period.

• General and administrative expenses decreased 50% year-over-year to $2.5 million.

Outlook and guidance

• Full-year 2025 targets: net revenue of $72–82 million, gross margin of 38–48%, and adjusted EBITDA of $6–11 million.

• Q2 expected to remain challenged with a mild EBITDA loss, but Q3 anticipated to show significant improvement as a new production line comes online, with Q4 projected to deliver full profitability.

• Sparkling mineral water launch in glass bottles is on track for Q3, with initial revenue in Q2 and full rollout in summer.

• Growth to be driven by Flow Sparkling launch, co-pack scale, and increased capacity utilization.

• Management anticipates sequential profitability improvements in fiscal 2025, focusing on profitable channels and co-pack agreements.