Jones Soda Co. increased revenue in Q2 on the back of a number of new product launches and partnerships across the beverage industry, even as immediate net losses widened.
According to the company’s latest earnings report released today, revenue was $7.2 million during the quarter, a 49% increase compared to the same period last year. Gross margin was 35%, a 3% improvement year-over-year.
“Since coming on board a year ago, I knew that Jones was destined for greatness,” said president and CEO David Knight in prepared remarks. “Within our Jones Soda Beverage Products division, we’ve made progress diversifying our offerings through new formats, new branding and new categories…and we believe we are only just getting started.”
Innovation has always been a key value proposition for the 27-year-old drink maker as it invests in a variety of categories to grow out of its craft soda roots. In March, the company crossed over into the RTD cocktail space with Spiked Jones and followed that with its first move away from glass-packaged soda with a line of 7.5 oz. Mini Jones cans.
In April, the drink brand partnered with Amazon on Nuka Cola, a LTO launched in conjunction with Prime Video’s Fallout television show. That was followed by a collaboration with rallycross racing league Nitrocross on canned Craft Cola and Craft Zero Cola varieties.
Jones Soda also continues to expand its hemp-derived THC division Mary Jones with investment in its distribution network across regions and formats. That division generated about $1.2 million in revenue, a 100% improvement from Q1 and 200% gain year-over-year.
That expansion has driven up costs. Jones Soda reported a net loss of -$1.6 million, up from about -$1 million in Q2 2023. Adjusted EBITDA was -$1.1 million compared to -$729,000 in the prior year period.
“We do expect our bottom line to continue to improve,” Knight said to investors on the call. “We’re very committed to being good stewards of capital, and have intentionally ramped up our investments in the short term to accelerate growth and increase profitability over the long term.”
The company is not planning to slow down its innovation stream but is targeting “higher margin beverage categories” to drive bottom-line improvements, Knight added.
There are five new product lines that will launch in the back half of the year including a lower-calorie, Latin-inspired fruit juice-flavored soft drink, Fiesta Jones, and its anticipated Pop Jones prebiotic soda. Pop Jones will roll out in 280 stores in the South and Midwest regions early next month.
Jones Soda will also be entering the craft mixer category with a similar rollout to the Mini Jones line. The “premium craft mixers” will be offered in 4-packs of 7.5 oz. cans and be available in six flavors, Knight said.
The Jones Craft Cola and Zero Cola will extend into the Mary Jones division as 5mg and 10mg varieties next month. Finally, Jones is extending its zero-calorie offerings with a Berry Lemonade and Zero Root Beer in the next 90 days as well.
Since Q2 ended June 30, Jones Soda closed a private placement offering of new securities of $3.2 million which will help fund all the new product launches and line extensions.