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What's happening?
Shares of Sodastream (SODA +0.00%) are trading 20% lower on Tuesday after the company issued preliminary third-quarter results that came in below expectations.
Why it's happening
Sodastream's third-quarter revenue is now expected to reach $125 million. This is not only below the year-ago quarter's $144 million top line, it's also far beneath Wall Street's expectations for $154.4 million in revenue. Analysts had also expected $17.5 million in operating earnings, and Sodastream's anticipated $8.5 million is less than half that. Sodastream made no bones about its miserable performance -- CEO Daniel Birnbaum said that the company is "very disappointed in our recent performance," which was blamed on weak U.S. demand due to a lack of customer growth.
The company is in the middle of a strategic shift toward focusing more on health and wellness, and will share more details on this strategy during the third quarter's conference call later in the month.
