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Guru Organic Energy Corp (GURU) reported its financial results for the second quarter of 2025, highlighting a significant improvement in gross margins and a reduction in net loss. Despite missing revenue forecasts, the company’s stock saw a slight increase in value, reflecting investor confidence in its strategic initiatives. According to InvestingPro data, GURU maintains an EXCELLENT financial health score of 3.78, with the stock delivering an impressive 19.65% return over the past year.
Key Takeaways
- Guru Organic Energy reported a net revenue of $6.5 million.
- Gross margin reached a record high of 59.7%.
- The company managed to reduce its net loss by 46.5% to $1.4 million.
- Stock price increased by 0.52% following the earnings report.
- Guru launched new Zero Sugar flavors, expanding its product line.
Company Performance
Guru Organic Energy’s performance in Q2 2025 showcased a strategic focus on improving profitability and expanding its product offerings. The company achieved a record gross margin of 59.7%, a significant milestone that underscores its operational efficiency and focus on high-margin products. Despite a drop in revenue compared to forecasts, the company reduced its net loss by nearly half, indicating progress towards financial stability.
Financial Highlights
- Net revenue: $6.5 million
- Gross profit: $3.9 million
- Gross margin: 59.7%
- Net loss: $1.4 million, improved by 46.5%
- Adjusted EBITDA loss: $1.2 million, improved by 55%
- Cash position: $25.3 million with no debt
Earnings vs. Forecast
Guru Organic Energy’s actual EPS of -$0.05 met the forecast, resulting in no earnings surprise. However, the company reported a revenue of $6.5 million, falling short of the $8.67 million forecast by 25.03%. This discrepancy highlights the challenges the company faces in aligning its sales strategies with market expectations.
Market Reaction
The company’s stock price increased by 0.52% to $1.93 following the earnings announcement, suggesting that investors are optimistic about Guru’s strategic direction and operational improvements. With a current market capitalization of $47.73 million and a year-to-date return of 5.12%, the stock has demonstrated resilience despite market challenges. InvestingPro subscribers can access detailed valuation metrics and expert analysis through the comprehensive Pro Research Report, one of 1,400+ available for top US stocks.
Outlook & Guidance
Looking ahead, Guru Organic Energy aims to drive profitable growth in the U.S. market, scale its Zero product line, and maintain cost discipline. The company is on track to accelerate its return to profitability in the latter half of the year, focusing on executing its direct distribution model and expanding its market presence.
Executive Commentary
CEO Karl Goyette emphasized the company’s commitment to long-term success, stating, "We are building a stronger, more agile Guru focused on long-term success." CFO Angie Sarraf highlighted the company’s path to profitability, noting, "We’re taking the right steps to go back and make sure that we’re returning to profitability."
Risks and Challenges
- Distribution Transition: The recent shift to a direct distribution model may pose short-term challenges in maintaining sales momentum.
- Revenue Miss: The significant revenue shortfall against forecasts could impact investor confidence if not addressed in future quarters.
- Market Competition: As the only organic zero sugar energy drink without sucralose or aspartame, Guru faces stiff competition from larger, established brands.
Q&A
During the earnings call, analysts inquired about the impact of the distribution transition on shipment volumes and the company’s strategies to sustain reduced operating expenses. Executives assured that the transition was progressing smoothly, with no major challenges anticipated in wholesale club rotations.
Full transcript - Guru Organic Energy Corp (GURU) Q2 2025:
Conference Operator: Good morning. Welcome to Guru Organic Energy’s Second Quarter twenty twenty five Results Conference Call and Webcast being recorded today, 06/12/2025 at 10AM Eastern Time. At this time, all participants are in a listen only mode. Following management’s presentation, there will be a question and answer session with financial analysts. Instructions will be provided at that time for you to queue up for questions.
Guru’s press release, MD and A and financial statements are available in the Investors section of the website and on SEDAR plus. During the call, the company may refer to certain non GAAP measures. Reconciliations are available in its MD and A. Also note that all financial figures are expressed in Canadian dollars unless otherwise indicated. I would also like to remind you that today’s presentation may contain forward looking statements about GluRo’s current and future plans, expectations and intentions, results, level of activity, performance, goals or achievements, or other future events or developments.
Please take a moment to read the disclaimer on the forward looking statement on Slide two of the presentation. I will now turn the conference over to Karl Goyette, Gurus’ Chief Executive Officer. Please go ahead, sir.
Karl Goyette, Chief Executive Officer, Guru Organic Energy: Thank you operator. Good morning everyone and welcome to Guru’s fiscal twenty twenty five second quarter results conference call. Joining me this morning is our CFO, Angie Sarraf. Let’s turn to slide five. Q2 marked the pivotal quarter in our transformation journey, one that feels especially energizing for myself and the team.
It’s the quarter where we took back control of our destiny in Canada. With 100% focus on Guru, we now have a direct relationship with retailers, more agility, more control and more opportunity to go on the offense. We transitioned back to our direct distribution model in Canada and the response from retailers has been very positive. Many are enthusiastic to work against with again with a local agile and flexible partner and they’re ready to support and grow with us. At the same time, we delivered recent record gross margins and strong US growth, reinforcing our confidence in the model and our progress towards sustainable profitability.
Our results showed clear progress. In The US, sales rose 38.9% excluding last year’s $1,400,000 wholesale club rotations. Amazon US hit a new monthly sales high in March and recorded 50 growth year to date. Repeat purchase rates increased to record levels signaling strong brand loyalty. Whole Foods Market also hit two record months in the quarter.
Amazon Canada saw 41% growth while Guru’s website realized its best month of 2025 in May with 30% year over year growth. Gross margins reached a recent record at 59.7% driven by pricing discipline, reductions in promotions by our exclusive distributor and supply chain efficiencies. Net loss was nearly cut in half to $1,400,000 our lowest since Q2 of twenty twenty one and adjusted EBITDA loss improved 55% to $1,200,000 These results confirm that our business fundamentals are not only strong, but continue to improve. And our cash position remained as strong as prior quarters at $25,300,000 with no debt, plus $10,000,000 in unused credit facilities. These results in this quarter strength of our brand, our disciplined approach to profitability.
Turning to Slide six, our Zero lineup continues to win with consumers. In Q2, we launched two new Zero Sugar flavors in Canada. In June, we launched Strawberry Watermelon online in Canada, and in Quebec retail stores just in time for the summer. Early results exceeded expectations, Wild Ice Pup outpaced Guru Original in its weeks on the shelf, quickly becoming the top performing Guru product in Quebec’s leading convenience store chain, a strong signal of consumer demand for our Zero Innovation. Our new products also are performing in The US.
Zero WildBerry is already outselling last year’s Tropical Punch launch in Whole Foods in The US. Turning to Slide seven, we officially launched our direct distribution model in Canada on May 22. This move marks our return to a proven model that fuels Guru’s growth from 1999 to 2021, allowing us to invest smarter, respond faster, and drive better execution at shelf with a singular focus on the Guru brand. All major retailers representing 98% of our volumes are now secured. We’ve built a robust network of over 25 distributors and brokers to reach retailers across the country.
Most partners have already delivered their orders in the past few weeks. Field activation is well underway with over 120 sales professionals from our partners and internal teams, now representing Guru in stores nationwide. We are very confident in the long term value of this transition in sales and distribution will unlock for Guru. Turning to slide eight, The US market remains a major growth engine for Guru. Retail sales and natural channel in Whole Foods grew 26% year over year.
Whole Foods posted its best two month streak. Our Zero Line continues to be a key growth driver in The US, helping expand both trial and loyalty. With stronger velocity, growing repeat rates, and solid new products, we are building a foundation for sustainable growth in The US. As the only organic zero sugar energy drink with no sucralose and no aspartame, Guru continues to offer a unique better for you modern alternative in an industry still dominated by artificial ingredients and chemicals. I will now turn the call over to Imjee Sarath, our CFO, to discuss our financial results in more detail.
Imjee, over to you.
Angie Sarraf, Chief Financial Officer, Guru Organic Energy: Thank you, Karl, and good morning, everyone. Turning to Slide 10. Let’s look at the numbers. Net revenue was $6,500,000 This reflects the planned transition away from our Canadian distributor and the absence of last year’s U. S.
Costco rotations. As mentioned in our Q2 press release, retail sales in Canada were temporarily impacted by order and shipment shortfalls. These challenges occurred ahead of our May 22 transition to a direct distribution model and led to short term product availability issues at certain retailers. We do not expect these issues to continue in future quarters. Gross profit reached $3,900,000 with a margin of 59.7%, the highest in our recent history, reflecting our ability to grow profitably at scale.
SG and A expenses dropped 26.2% showing cost discipline. Net loss improved 46.5% to $1,400,000 Adjusted EBITDA loss was down by more than half at $1,200,000 These results underscore our focus on efficiency, execution and setting up for profitable growth. Our financial position remains solid. We ended the quarter with $25,300,000 in cash and no debt. We also have $10,000,000 in unused credit available.
This gives us flexibility to continue investing in high impact areas and to support our relaunch in Canada. Turning to Slide 11. Looking ahead, our priorities remain clear. Drive profitable growth in The U. S.
Through retail, natural and online channels. Scale our Zero line with upcoming Costco rotations in Q4 in Canada and in The U. S, execute our direct distribution model in Canada with excellence and maintain cost discipline and expand margins. We’re well on track to accelerate our return to profitability in the half of the year. With that, I’ll now turn the call back over to Karl for closing remarks.
Karl Goyette, Chief Executive Officer, Guru Organic Energy: Thanks, Yunji. Let’s turn to Slide 13. We are proud of the progress we made this quarter. We are building a stronger, more agile Guru focused on long term success. Consumers are choosing good energy and they’re choosing Guru.
Our mission to clean up the energy drink industry resonates more than ever with the modern energy drink consumers, who are health conscious and demanding transparency and better ingredients. Retailers are also responding, they’re excited to work directly with us, move fast, execute and win together. With a simplified distribution model, a winning zero line and a disciplined approach to growth, we’re ready to take the next steps. I also want to thank our team and all our new partners for their commitment, agility and belief in the power of choosing good energy, especially as we relaunched our Canadian sales and distribution operations. Thank you for your continued support.
Operator, we will now open the call for questions.
Conference Operator: Thank you. We will now begin the question and answer session. Our question is from Sean McGowan with ROTH Capital Partners. Please proceed.
Sean McGowan, Analyst, ROTH Capital Partners: Good morning, Carl. Good morning, Angie. How are you?
Karl Goyette, Chief Executive Officer, Guru Organic Energy: Morning, Sean.
Angie Sarraf, Chief Financial Officer, Guru Organic Energy: Good morning, Sean.
Karl Goyette, Chief Executive Officer, Guru Organic Energy: We’re good. Thank you.
Sean McGowan, Analyst, ROTH Capital Partners: My question would be, if you could kind of square the scan data with the shipment decline. If this is just disruption from the transition, could we view this as maybe you would have had to take this product back if they if you had shipped it to Pepsi and then they didn’t sell it, you’re going to have to take it back anyway. So this really isn’t something we wouldn’t have seen anyway. You know what I mean? You know what I’m asking?
Karl Goyette, Chief Executive Officer, Guru Organic Energy: Yes, no, I agree. It deserves explanation, so I’ll try to take you through a few facts to help you understand. Bear with me for few bullet points if you don’t mind Sean. this has nothing to do with inventory buyback, right, because at the time of the second quarter, our distribution agreement wasn’t terminated yet, right. So this is not an inventory buyback.
For your question on scan, when we look at tracked and untracked, we did see a decline in Q2 in our tracked and untracked by 6%. So there is a small decline there and that is driven by what we saw in other stocks at retail due to the shipment shortfalls and some of the promos, like Angie mentioned, some of the promos that were not repeated this year by our exclusive distributor. And so there was a bit of an impact there. But when we look at other indicators of demand, if you look at online for example in Canada, online is up 20%, with Amazon up 26% in the quarter, right, more than that year to date. But where where the the hit was really as we in retail shipment, right?
Retail shipments in in the quarter were were down 24%. So our distributors shipped a lot less cases this quarter than last year, especially in April towards the end of the distribution agreement where in April shipments were down 45% versus last year. So this is significant shipment shortfalls prior to the end of the agreement, but we expect this to be temporary, right? We don’t we are now as we said, we have completed the transition, this is now behind us, we have 25 distributors that are ready to ship and push the sales of Guru. We have 120 reps when we combine our teams with our agencies to push sales and recoup, hopefully, a lot of these lost sales.
Sean McGowan, Analyst, ROTH Capital Partners: Okay. That’s helpful context. But what I meant when I was asking about buyback was not did it affect this quarter, it was more if you had sold more to Pepsi, you know, would you have eventually had to buy that back anyway, like in a later quarter?
Karl Goyette, Chief Executive Officer, Guru Organic Energy: No. No. In an ideal scenario, we would have sold more to Pepsi because Pepsi would have shipped more.
Sean McGowan, Analyst, ROTH Capital Partners: Right? Yeah. Okay.
Karl Goyette, Chief Executive Officer, Guru Organic Energy: We had agreed to, like, prior to after the end after the notice of termination, we had looked at our business plans, and we had a joint business plan that called for a flat sales between between the for the last few months, and we saw these declines. Right? So if PepsiCo would have shipped more, we would have sold more to them, and we had an agreement to take a few weeks back of inventory at the end anyway. Okay.
Sean McGowan, Analyst, ROTH Capital Partners: Thanks. I appreciate that. Are there any other wholesale club rotation comp challenges coming up? Do we have year over year comparison challenges coming up from any of that?
Karl Goyette, Chief Executive Officer, Guru Organic Energy: No, nothing significant. It was important for The U. S. In this quarter. Obviously, year, if you look at the quarter last year, made $2,700,000 but of the $2,700,000 in The U.
S, there was $1,400,000 in Costco and two Costco rotations. So that was very significant in Q2 last year. But if you move that, all the indicators we look at in The U. S. As you saw in our remarks are growing.
But there’s no other ones coming up. For comp last year, obviously there’s more coming to increase our sales in the future, but nothing to comp from last year.
Sean McGowan, Analyst, ROTH Capital Partners: Okay, thanks. Couple of questions for you, Angie. And operating expenses were down sequentially and year over year. If we look at selling expenses, how much of that decline is the result of the sales decline, and how much of the decline is a little bit more sustainable?
Angie Sarraf, Chief Financial Officer, Guru Organic Energy: No, I would think that it’s actually very sustainable. It’s really more a function of us making sure we’re very efficient. Like we said, we’ve also looked at making sure that high impact ROI activities are kept in place and removed the ones that were less beneficial. So we’re learning from that and we’re actually getting much more effective and efficient our approach. So it’s very sustainable.
Sean McGowan, Analyst, ROTH Capital Partners: So you think this dollar level of G and A is something we could expect to continue in the near term?
Angie Sarraf, Chief Financial Officer, Guru Organic Energy: Yes. The dollar level will will, of course, grow a bit with the activities, more activities like we that we will do. Like we said, there were some that were not done in the past quarter. So from an activity standpoint, it could grow a bit, but from a fixed cost and kind of the structure we have in place, yes, it will remain.
Karl Goyette, Chief Executive Officer, Guru Organic Energy: Right. Okay. Okay.
Sean McGowan, Analyst, ROTH Capital Partners: Mean, some of that activity, would that be more in selling than than in g and a?
Angie Sarraf, Chief Financial Officer, Guru Organic Energy: Yeah, in selling, of course, in SG and A, in the total SG and A, not in SG and You’re right.
Sean McGowan, Analyst, ROTH Capital Partners: And then last question, I just wanna make sure I heard your kinda concluding comments, Angie, correctly. What comments did you make regarding achieving profitability? Did you do a forecast for the half of the year?
Angie Sarraf, Chief Financial Officer, Guru Organic Energy: Of course, we always do forecast and always plan ahead. Just to give you some color, like we said, right, in the past, we’re returning back to profitability. So we’re seeing that we’re taking the right steps to get there in due time. And that’s what we’ve been seeing with last quarter, which was the lowest loss since 02/2021. This quarter, the lowest.
So we’re just taking the right steps to go back and make sure that we’re returning to profitability and that this business is scalable like we’ve always done.
Sean McGowan, Analyst, ROTH Capital Partners: Great. Okay. Thank you very much.
Angie Sarraf, Chief Financial Officer, Guru Organic Energy: Thank you.
Karl Goyette, Chief Executive Officer, Guru Organic Energy: Thank you, Sean.
Conference Operator: We have reached the end of our question and answer session. I would like to turn the conference back over to management for closing remarks.
Karl Goyette, Chief Executive Officer, Guru Organic Energy: Well, thank you, operator, and thanks everyone for joining and choosing GoodEnergy. Have a great day.
Conference Operator: Thank you. This will conclude today’s conference. You may disconnect your lines at this time, and thank you for your participation.
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