v3.26.1
RELATED PARTY TRANSACTIONS
 6 Months Ended
Jun. 30, 2026
Related Party Transactions [Abstract]  
RELATED PARTY TRANSACTIONS RELATED PARTY TRANSACTIONS
In August 2022, the Company and Pepsi entered into multiple agreements, including the Original Purchase Agreement, the Original U.S. Distribution Agreement and the Original Transition Agreement. Under the Original Purchase Agreement, the Company issued approximately 1.5 million shares of non-voting Series A Preferred Stock to Pepsi for an aggregate purchase price of $550.0 million. The fair value of the Series A Preferred Stock at issuance was estimated at $832.5 million, resulting in $282.5 million of excess fair value recorded as deferred costs within the Condensed Consolidated Balance Sheets. As a result of these transactions, Pepsi became a related party based on its equity ownership in the Company and its Board representation.

In August 2025, the Company entered into a series of strategic transactions with Pepsi. As part of these transactions, the Series A Preferred Stock was modified to align key terms, such as conversion and redemption dates, with those of the newly issued Series B Preferred Stock. The Company recorded an increase of $27.9 million to the Series A Preferred Stock carrying value as part of the overall Pepsi Transactions.

Under the Series B Purchase Agreement, which was also entered into in August 2025, the Company issued 390,000 shares of Series B Preferred Stock to Pepsi. Each share of Series B Preferred Stock is convertible, subject to certain conditions and adjustments, into approximately 29 shares of Common Stock and Pepsi obtained the right to designate one additional Board member for a total of two Board seats, which number may in certain circumstances be ratably increased upon a subsequent expansion of the number of persons serving on the Board. The Series B Preferred Stock issued in connection with the Pepsi Transactions had a stated purchase price of $585.0 million and a fair value $907.9 million on the issuance date. The total non-cash consideration of $935.8 million comprised the fair value of the newly issued Series B Preferred Stock and the modified Series A Preferred Stock. The total non-cash consideration was allocated among the various components of the Pepsi Transactions, including the implicit upfront payment to Pepsi for the Captaincy, considering the allocation measurement principles of ASC 606, and the Rockstar Acquisition, based on the estimated value of Rockstar. The implicit upfront payment to Pepsi is being amortized as a reduction of revenue over the term of the A&R U.S. Distribution Agreement in accordance with ASC 606.

As part of these arrangements, the Company and Pepsi also entered into the A&R Distribution Agreements under which Pepsi became the primary distributor of Celsius, Alani Nu and Rockstar products in the U.S. and Canada. Pursuant to such agreement, Pepsi agreed to reimburse the Company for distributor termination fees up to $275.0 million to facilitate the transition of certain Alani Nu distribution rights to Pepsi. As of June 30, 2026, the Company had received the entire $275.0 million from Pepsi. The Company recorded the amount received as deferred revenue and recognizes it as an increase to revenue on a straight-line basis over the term of the A&R U.S. Distribution Agreement.
On May 21, 2026, the Company entered into the Channel Transition Amendment which transferred additional territory rights of certain former Alani Nu distributors to Pepsi. Pepsi agreed to reimburse the Company $81.1 million for related distributor termination fees, with amounts received by the Company from Pepsi contractually restricted for use solely to satisfy the related termination obligations. As of June 30, 2026, the Company had received the entire $81.1 million from Pepsi and utilized substantially all of such amounts in accordance with the Channel Transition Amendment. The Company recorded the amount received as deferred revenue and recognizes it as an increase to revenue on a straight-line basis over the remaining term of the A&R U.S. Distribution Agreement.

The following table presents deferred revenue and deferred other cost balances related to the 2026, 2025 and 2022 transactions entered into with Pepsi. Each of these amounts is included within the respective line item on the Condensed Consolidated Balance Sheets as of June 30, 2026 and December 31, 2025.
June 30, 2026
Balance sheet line item2026 Transaction
2025 Transaction
2022 Transaction
Total
Deferred other costs-current$— $35,348 $14,124 $49,472 
Deferred other costs-non-current— 533,708 213,029 746,737 
Deferred revenue-current4,992 16,256 9,513 30,761 
Deferred revenue-non-current$75,299 $245,066 $143,491 $463,856 
December 31, 2025
Balance sheet line item
2025 Transaction
2022 TransactionTotal
Deferred other costs-current$35,040 $14,124 $49,164 
Deferred other costs-non-current551,544 220,091 771,635 
Deferred revenue-current16,815 9,513 26,328 
Deferred revenue-non-current$252,954 $148,201 $401,155 

For the three and six months ended June 30, 2026, amortization of deferred other costs recognized as a reduction of revenue was approximately $12.3 million and $24.6 million, respectively. For the three and six months ended June 30, 2026, amortization of deferred revenue recognized as an increase to revenue was approximately $7.3 million and $13.7 million, respectively.

For the three and six months ended June 30, 2025, amortization of deferred other costs recognized as a reduction of revenue was approximately $3.5 million and $7.1 million, respectively. For the three and six months ended June 30, 2025, amortization of deferred revenue recognized as an increase to revenue was approximately $2.4 million and $4.8 million, respectively.
For more information on the components of the Pepsi Transactions, the A&R Distribution Agreements and the Channel Transition Amendment, see Note 4. Revenue, Note 5. Acquisitions and Note 12. Mezzanine Equity.