(Reuters) – Monster Beverage missed Wall Street expectations for fourth-quarter revenue on Thursday, as budget-conscious consumers turned wary of purchasing the company’s higher priced beverages and energy drinks.
With consumers in the U.S. battling higher costs of essentials like food and fuel, spending on pricier beverages has turned conservative, hurting sales for companies such as Monster Beverage, as well as rivals like Keurig Dr Pepper and PepsiCo.
Beverage companies resorted to several rounds of price hikes last year to offset higher costs of freight, aluminum and raw materials such as sugar.
While prices of freight and aluminum have cooled, higher sugar costs have continued to weigh.
The company’s net revenue rose 14.4%, to $1.73 billion in the fourth quarter, falling short of analysts’ estimate of a 16% rise to $1.75 billion.
Gross profit as a percentage of net sales for the fourth quarter was 54.2%, compared with 53% last quarter.
Excluding items, the company earned 35 cents per share, compared with LSEG estimates of 38 cents per share.
(Reporting by Juveria Tabassum; Editing by Pooja Desai)
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