Zevia Q3 2026 Earnings: Sales Rise 18.4% as Losses Narrow

Zevia (NYSE: ZVIA) reported Q3 2026 net sales of $48.3 million, up 18.4% from $40.8 million, while diluted loss per share narrowed to $0.03 from $0.04. Volume growth, pricing, and the absence of last year’s inventory write-down lifted gross margin, although increased marketing investment limited the improvement in operating profitability.

Core Performance Data

Sales growth included a 14.4% increase in volume, associated with a national rotation in the club channel and strength in e-commerce, as well as pricing actions. Gross profit increased faster than revenue, while both the GAAP net loss and non-GAAP adjusted EBITDA loss narrowed.

Zevia remained loss-making, but its operating loss improved by approximately $0.7 million and its adjusted EBITDA loss improved by approximately $0.8 million from a year earlier.

Adjusted EBITDA is a non-GAAP measure. Parentheses indicate losses.

Volume and Pricing Expanded Gross Profit, While Brand Spending Limited Leverage

Gross margin rose to 46.4% as pricing actions and the comparison against a $0.8 million obsolete-inventory write-down in Q3 2025 more than offset higher aluminum costs. Because part of the improvement came from lapping the write-down related to Zevia’s package redesign, the margin increase did not come solely from current-period operating efficiencies.

Marketing expense increased by $2.2 million to $7.2 million as Zevia invested in brand awareness. Marketing represented 14.8% of sales, up from 12.1%, while total selling and marketing expense rose to $15.1 million from $12.7 million. Higher volume and fuel rates also increased freight expense, partially offset by lower warehousing costs.

General and administrative expense increased to $8.3 million from $7.7 million, primarily because of personnel costs and higher accrued variable compensation. However, G&A declined as a percentage of sales to 17.1% from 18.8%, showing some overhead leverage from the larger revenue base. Overall, much of the approximately $3.8 million increase in gross profit was absorbed by higher marketing and other operating expenses, limiting the reduction in operating losses.

Cash Flow and Balance Sheet

Zevia’s cash flow figures cover the nine months ended September 30 rather than Q3 alone. Operating activities generated $5.5 million during the first nine months of 2026, compared with a $4.2 million cash outflow in the same period of 2025. The improvement reflected a smaller net loss and favorable working-capital movements, including a $5.3 million reduction in inventory.

Inventory stood at $15.1 million on September 30, down from $20.4 million at the end of 2025. Cash and cash equivalents increased to $29.5 million from $25.4 million over the same period. Zevia had no outstanding debt and had not drawn on its $20 million revolving credit facility.

After the quarter ended, Zevia announced an October 22 definitive agreement for a $20 million growth-equity investment from a fund managed by GP Investments. The transaction involves convertible preferred stock, and the announced capital is separate from the reported September 30 cash balance. Management plans to use the additional resources to support innovation, portfolio expansion, distribution, and brand building.

2026 Guidance

Zevia raised its full-year net sales and adjusted EBITDA outlook, although the release did not include the prior numerical guidance ranges. The company also issued Q4 guidance that anticipates continued sales growth efforts but another adjusted EBITDA loss.

The full-year outlook assumes approximately $8.5 million of incremental costs related to elevated fuel prices and higher aluminum costs, compared with the prior assumption of $11 million. That represents about $2.5 million less anticipated cost pressure.

Zevia did not provide a GAAP equivalent for its adjusted EBITDA guidance because equity-based compensation, taxes, litigation expenses, and potential restructuring or cost-saving charges remain uncertain. The company noted that these reconciling items could materially affect future GAAP results.

Risks Investors Need to Watch

• Aluminum and fuel costs: Higher aluminum costs already offset part of the gross-margin benefit, while increased fuel rates raised freight expense. The guidance still assumes $8.5 million of incremental cost pressure from these items.
• Continued spending ahead of profitability: Marketing rose faster than sales and reached 14.8% of revenue. Zevia also expects an adjusted EBITDA loss in Q4, so the timing and returns from brand investment remain important.
• Dependence on channel execution: The quarter’s 14.4% volume increase was linked to the club-channel rotation and e-commerce strength. Sustaining growth will depend partly on continued execution across these channels.
• Difference between adjusted and GAAP results: Full-year profitability guidance is based on adjusted EBITDA without a forward-looking GAAP reconciliation. Equity compensation, litigation, and restructuring-related items could produce a different GAAP outcome.

Summary

Zevia’s Q3 2026 results combined 18.4% sales growth with a higher gross margin and narrower losses, driven by volume, pricing, and an easier inventory comparison. Higher marketing and freight expenses absorbed much of the additional gross profit, but year-to-date operating cash flow and liquidity improved. The main areas to monitor are delivery against the raised 2026 outlook, aluminum and fuel costs, the effectiveness of brand spending, and the capital-structure implications of the planned growth-equity investment.