BellRing (BRBR) Q3 Revenue Rises 6%

BellRing Brands (BRBR -0.87%), a leader in the convenient nutrition space, released its third-quarter earnings for fiscal 2025 on August 4, 2025. The company topped both top- and bottom-line expectations, with GAAP revenue of $547.5 million and non-GAAP EPS of $0.55 exceeding analyst estimates, with GAAP revenue climbing to $547.5 million against an analyst consensus of $531.7 million, and adjusted earnings per share (non-GAAP) reaching $0.55 versus the $0.50 estimate. However, investors noted a sharp fall in reported GAAP net earnings, which dropped to $21.0 million from $73.7 million in Q3 FY2024, mostly due to a $68.1 million legal provision tied to legacy product litigation. While underlying consumer demand remained robust and core brand metrics hit record levels, the quarter exposed cost pressures and legal risks. The results reflected ongoing brand momentum, but also highlighted key risks and the importance of operational discipline in coming quarters.

Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q2 2025 earnings report.

Business Overview and Strategic Focus

BellRing Brands is a U.S.-based nutrition company focused on ready-to-drink (RTD) protein shakes, powders, and other health-focused food products. Its portfolio centers on the Premier Protein and Dymatize brands, which meet demand for convenient, protein-rich nutrition options for both everyday consumers and athletes.

Recent years have seen the company emphasize growth within the health and wellness category, which is expanding as consumers seek high-protein and on-the-go nutrition. The majority of BellRing’s U.S. sales come through major retail customers like Walmart, Amazon, and Costco, emphasizing the importance of these partnerships. Key success factors include maintaining strong brand health and household penetration, continual innovation and launches of new product lines, and navigating supply chain reliability and manufacturing quality. Strategic autonomy gained following its spin-off from Post Holdings has allowed BellRing to allocate capital flexibly, increase marketing, and focus on new initiatives.

Quarterly Highlights: Sales Growth, Margin Pressure, and Legal Impact

Revenue (GAAP) rose 6.2% year over year, supported by a combination of 3.5% higher sales volumes and a 2.7% positive shift in mix and pricing. This growth exceeded analyst expectations, reflecting “the strength and continued momentum of our business.” according to management. Premier Protein, BellRing's flagship ready-to-drink shake brand, grew net sales by 6.0%, also driven mostly by volume gains and modest pricing increases aimed at offsetting higher input costs. The Dymatize brand, which focuses on sports nutrition powders and pre-workout products, delivered a 5.4% sales increase, primarily on the back of new products and international growth.

Despite robust top-line and consumption trends, profit metrics came under pressure. Adjusted gross profit margin declined from 36.4% to 35.1% year over year, due to input cost inflation and increased promotional activity. Adjusted EBITDA, which measures earnings before interest, taxes, depreciation, and amortization and excludes one-time expenses, increased only slightly by 0.7%, indicating margin constraints. Operating profit fell as a hefty $68.1 million provision was recorded for the anticipated settlement of the discontinued Joint Juice brand litigation. This one-off legal expense was the key driver behind the sharp reduction in reported net earnings to $21.0 million. Adjusted net earnings (non-GAAP) were $70.8 million, a 1.5% decrease from the prior year.

Consumption data remained a bright spot, with Premier Protein RTD shakes and powders reported 18.6% and 27.2% increases, respectively, for the 13-week period ended June 29, 2025, based on dollar consumption metrics. Dymatize powder and RTD products were up 4.5% for the 13-week period ended June 29, 2025, compared to the same period in 2024. Management noted that these high underlying consumption rates outpaced shipment growth, in part due to a reduction in retailer inventory levels—a normalization following last year’s stock build amid supply constraints. The company described this “destocking” as a timing event, emphasizing “no softness, no concern around consumption.”

Another operational signal was the stability of supply chain performance, which allowed the company to support increased promotional activity and new product launches. Share buybacks were active, with 1.3 million shares repurchased at an average price of $65.07, though this and the legal settlement contributed to a rise in long-term debt (GAAP) to $1,009.0 million from $833.1 million at FY2024 fiscal year-end. The business does not pay a dividend, keeping its focus on reinvestment and buybacks.

Brand, Product, and Channel Developments

Premier Protein—BellRing's largest brand—anchors the company’s position in “convenient nutrition.” This product family includes ready-to-drink shakes and powder supplements targeting both breakfast replacement and snacking occasions. In the quarter, the brand posted record levels of household penetration and distribution. Management called out “industry-best loyalty metrics” and highlighted momentum from new flavors and pack sizes, as well as broader expansion across key retail and eCommerce channels. The recently launched “indulgence” line, aimed at satisfying snack and treat occasions, showed early incremental gains and attracted new consumers to the brand and category.

Dymatize, the company’s sports nutrition line, reported sales growth and category share gains, especially internationally. The product lineup includes protein powders, ready-to-drink shakes, and pre-workout beverages. New launches, such as Dymatize RTD shakes and its Energize pre-workout, contributed to volume increases. Management emphasized international momentum and the addition of new athlete endorsements as positive tailwinds. In the U.S. Dymatize continues to target performance-driven consumers, with eCommerce remaining its primary sales channel.

Distribution and channel health remained core themes. BellRing’s reliance on a concentrated set of large retailers—Walmart, Costco, and Amazon, which accounted for approximately 74.8% of FY2024 net sales—means that inventory management choices by these partners can create order variability from quarter to quarter. This period’s revenue growth was slightly held back by a normalization in retail inventory, which management described as a one-time restock adjustment related to last year's supply constraints. Despite this, noted consumption trends and record shelf penetration metrics suggest strong ongoing demand at the consumer level.

Legal risk surfaced with a $68.1 million expense tied to settling claims related to the discontinued Joint Juice brand. Management stated that “reached a class-wide settlement in principle” and expects the settlement to fully resolve the legacy product risk. Although characterized as a one-off, this underscores legal risks associated with discontinued products and the need for ongoing risk management vigilance.

Looking Ahead: Guidance and Future Watch Points

Management narrowed its FY2025 financial guidance and now expects net sales of $2.28 billion to $2.32 billion, and adjusted EBITDA (non-GAAP) of $480 million to $490 million. If achieved, these ranges represent year-over-year growth of 14–16% for sales and 9–11% for adjusted EBITDA compared to FY2024. Leaders cited shipment timing shifts—mainly between Q3 and Q4 FY2025—as well as persistent cost pressures from input prices and promotional outlays. Capital expenditures are forecast at $9 million for FY2025. No material near-term impact from new input tariffs is anticipated; management indicated that potential cost increases would not begin to affect results until FY2026.

Management signaled ongoing commitment to marketing investment, innovation pipelines, and share repurchases. Future analyst attention should focus on margin trends in response to sustained cost inflation and higher promotional spending, the sustainability of high consumption rates, inventory management at top retail partners, and updates on legal exposure and capital allocation strategies.

Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.