Good day and thank you for standing by. Welcome to the SUJA Life Third Quarter 2026 Earnings Conference Call.

At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you'll need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised.

To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your first speaker today, Mike Mougias, Head of Investor Relations. Please go ahead.

Good afternoon and welcome to Sued Your Life's third quarter 2026 earnings call. Joining me today are Maria Stipp, Chief Executive Officer, and Jeff Pedersen, Chief Financial Officer. Our earnings press release was published this afternoon and can be found on our Investor Relations website. Today's call is being webcast there as well, and a replay will be made available shortly after the call. Before we begin, a reminder that today's discussion will include forward-looking statements. These statements reflect our current expectations and are covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. They're subject to risks and uncertainties that could cause actual results to differ materially. For more on those risks, please see today's press release and our most recent SEC filing. We assume no obligation to update these statements. will also refer to certain non-GAAP financial measures. You'll find reconciliations to most comparable GAAP measures in today's press release and our SEC filings. We're unable to reconcile forward-looking non-GAAP measures without unreasonable effort. With that, I'll turn the call over to Maria.

Thank you, Mike, and good afternoon, everyone. The third quarter showed what this business can do in an environment where consumers remain under pressure. Net sales grew 3% to $76.4 million ahead of our outlook we gave you in August. That includes approximately 2 million of shipments that moved from the fourth quarter into the third. Adjusted EBITDA was $10.5 million, a $9.6 million increase versus last year. Three things stand out to me this quarter. First, consumers are choosing our brands. Suja Gaines share again this quarter, and our newer lines, like our refreshers, are leading the way. Second, we're winning where shoppers are going with strong growth in club and convenience. And third, we're managing the business for profitability. We expect adjusted EBITDA to grow roughly 70% this year, with margin expanding about seven points to nearly 20% while investing deliberately behind our brands. That discipline is especially important given the continued pressure in grocery, which is shaping our near-term expectations. I'll walk through each of these and how we're adapting our plans in response. Jeff will then take you through the numbers and our updated financial outlook. Let me start with share. In the third quarter, our share of natural healthy beverage rose approximately 30 basis points to just over 9%, according to Nielsen. Year-to-date, we're at more than a full point. And in the quarter, among the category's five largest manufacturers, Sujo was the only one to gain share. Those gains came amid increased promotional activity across the category and pressure on household budgets. In grocery, the percentage of natural healthy beverage dollars sold on promotion in the quarter increased more than six percentage points versus a year ago. Despite that increase, the added promotion didn't translate into overall category growth. We chose carefully where to put our promotional dollars. We stepped up support behind our shots and refreshers, but we didn't chase the deepest discounts in grocery where they weren't paying back. and our share gains show that consumers are still choosing our brands even with more promotion in the market. Second, shoppers continue to seek better for you products. They're buying them in different places and we're following them. In the third quarter, our Nielsen measured sales and club grew nearly 20%. In convenience, they grew more than 40% from a small base. And in mass, they grew about 6% with more room ahead. In August, I told you we'd expand our programs in club en masse. Club is our clearest win so far, driven by incremental programming on Suja organic green juices and wellness shots. We also said we'd work arm in arm with our retail partners, and we did through top to top sessions with several of our largest customers. Those conversations have helped secure meaningful new distribution with more reset meetings still to come. and we keep investing in our brands. Marketing was 10.5% of net sales in the quarter, weighted toward bottom of funnel programs that help drive purchases at shelf. Where we have the most work to do is conventional grocery, our largest channel. Weaker store traffic across the industry continues to weigh on our sales velocities. Despite that headwind, we grew distribution nearly 10% in the quarter, which tells you retailers continue to want our brands on their shelves. But each of those placements is selling less on average than a year ago. Some are newer items that can take time to build and some are core single serve items in grocery. Distribution only creates value when it turns. So our focus is on both continuing to earn new distribution and making every point work harder through better placement Sharper price pack architecture and marketing that converts at the shelf. When we spoke in August, we expected a stronger fourth quarter driven by new distribution, seasonal programs on our commercial actions. Those actions are in place and the fourth quarter is historically our strongest season for wellness shots. But the grocery pressure that began in July has intensified. Store traffic is softer. Retailers are cutting prices more deeply and promotions are delivering lower returns. As a result, we no longer expect the fourth quarter step up we planned for, and we're lowering our full year outlook, which assumes today's grocery conditions hold through year end. We will discuss this more in a moment. Turning to our brands, Soudra Organic Cold Pressed Juice continues to lead our growth. reflecting the work we did in 2023 and 2024 to reposition the brand around functional benefits. Our refreshers platform grew more than 40% in Nielsen measured dollars in the third quarter, with velocity still rising as we added distribution. Our boosted juice grew more than 18%, and our larger multi-serve formats continue to build in the quarter. Green Juice, the platform that started this brand, softened in grocery in the quarter, even as it helped drive our club growth. Reinvigorating it is a priority. Wellness shots remain one of the fastest growing segments in beverage, up double digits this quarter. Our multi-packs continue to grow with some consumers shifting from single serve to multi-packs as shots become a part of their daily routines. Our single serve shots were softer in the quarter. That brings me to Vibe Organic. Vive pioneered this category, and it remains one of our top priorities. Part of running a portfolio of brands is giving each one what it needs at its stage of growth. For Vive, over the coming quarters, that means working on sharper single-serve price pack architecture and promotion, leading with multi-packs, and exploring innovation built around ingredient-forward benefits. It's the same playbook that's driving growth in Soudra Organic Juice today. Finally, Slice. Year-to-date, SliceNet sales are up 31% and emerging brands adjusted EBITDA loss narrowed by 9.1 million versus last year's third quarter. In the quarter, growth slowed to 3% as the Better For You Soda growth moderated and new distribution turned more slowly than expected. We're resetting expectations and looking to concentrate Slice where it's working. That brings me to the third point, how we're managing the business. Stepping back, this has been a year of real change for Suja. We became a public company, our category tightened, and we've streamlined how we operate. I think about Suja's history in three chapters. The first was proving we could build these brands. The second was proving that we could make them laugh. This next chapter is about scaling with intention, and that means making choices. We brought our marketing, sales, and innovation teams together into one commercial organization so we can plan further ahead, move faster with our retail partners, and we're directing investment into channels and platforms and programs with the clearest returns. Owning our production gives us more control over our costs and our supply, and that's what creates room to make choices. It doesn't make us immune to inflation, particularly in fuel, packaging, and other inputs, but it helps us absorb these pressures and keep investing to grow our brands while expanding profitability this year. Our priorities ahead are clear. First, building velocities across our portfolio, including in our core greens juices, single-serve shots, and vibes. As part of that, we expect to launch a new marketing model in the first quarter of 2027. It's full funnel and it's social first. It puts more of our spend behind what's already working and it reaches consumers where they spend their time. Most consumers discover us at the shelf or through word of mouth. And so that's where we're focused. The experience at the shelf and what people hear about us from their friends, family, and trusted sources. Having marketing sales and innovation in one commercial organization is what makes that possible. Second, deepening our penetration in existing accounts and capturing white space in channels where we're underdeveloped. We're in the selling season for 2027 placements and we're encouraged by the early progress. Third, innovating to capture new consumer opportunities with new formats and adjacent categories that build on our platform. and throughout grow profitably through scale. These priorities will take time to show up in our results, so I want to be clear about how we see the next several quarters. We expect net sales to grow by roughly 8% this year, but we'll exit 2026 at a softer run rate. Looking beyond 2026, we expect continued pressure in grocery and difficult comparisons in the first half of 2027, particularly in the first quarter. Our new programs and innovation are expected to reach shelves over the course of the year, with our contributions building progressively. So we expect a slower start to 2027, with top line growth improving as the year progresses. Through this period, we expect to continue gaining share. And when the category picks back up, we believe we'll be in a strong position to benefit. We'll provide our formal outlook on our fourth quarter call in March. That said, our conviction in the long-term opportunity hasn't changed. We're not just taking share in an existing category. We're helping build a new segment of the beverage aisle. Household penetration rose to 11.2% from 9.6% a year ago, and spend per buyer grew 9% to nearly $31. Even so, only about 11% of U.S. households buy our brands today, which leaves substantial room to grow. Consumers continue to look for beverages that do more for them and taste great, and that's exactly where our brands compete. We have leading brands, a vertically integrated platform built over a decade, and retail partners who rely on us to grow the category. Our focus now is on turning those strengths into more consistent, profitable growth. We have work to do, and I'm confident in our ability to deliver. With that, I'll turn it over to Jeff.

Thank you, Maria, and good afternoon, everyone. I'll start with detail on our third quarter results and then walk through our updated outlook for the full year. Net sales for the third quarter ended September 28, 2026, increased 3.3% to $76.4 million, compared to $74 million in the prior year period. As Maria mentioned, that was ahead of the approximately 71 million estimate we shared in August. Growth was primarily driven by volume gains across key products and new distribution, partially offset by higher trade investment in wellness shots, where our cost position allows us to stay competitive in a more promotion-driven environment. Third quarter net sales also benefited from approximately $2 million of shipments that we had expected in the fourth quarter. Looking at our segments, SujaCore net sales increased 3% to $74.8 million, reflecting three dynamics. First, hold press juice continued to grow, led by our refreshers, the largest contributor to SujaCore's growth year-to-date. Second, wellness shot multipacks continued to grow, while single-serve shots were softer. and third, the higher trade investment I mentioned weighed on net sales growth. In emerging brands, slice net sales increased 3% to 2.7 million. That said, growth in Better For You Soda has slowed this year and new distribution has built more slowly than we expected. Gross profit was 33.5 million or 43.9% of net sales compared to 34.3 million or 46.3% in the prior year period. That was below the approximately 47.8% we estimated in August. Historically, the third quarter has been our lowest gross margin quarter, given a lower mix of wellness shots. Three factors drove the decline. First, higher promotional investment in a more competitive environment. Second, unfavorable fixed cost absorption in our supply chain. as category softness reduced production volumes. And third, higher inbound freight and packaging costs, both tied to higher oil prices. Ongoing efficiency improvements across our operations along with favorable purchase prices on key produce inputs are partially offsetting these pressures. We expect gross margin to improve sequentially in the fourth quarter as production volumes rise seasonally and these efforts continue. SG&A expenses were $36.5 million or 47.8% of net sales compared to $41.4 million or 56% in the prior year period. Three items stand out. Marketing was $8 million or 10.5% in net sales compared to $17.1 million or 23.2% last year. The decrease primarily reflects lapping in one-time launch investment behind Slice in the third quarter of 2025. Freight costs increased, driven by higher carrier rates as fuel prices and labor availability pushed transportation costs up. Additionally, we recognized one-time costs, including $1.5 million in organizational restructuring, which are excluded from adjusted EBITDA. Net loss was $8.3 million compared to a net loss of $14.6 million in the prior year period. This quarter's net loss included about $6.7 million of one-time items, including a $1.8 million loss on debt extinguishment related to the refinancing and $1.5 million of restructuring costs. Adjusted EBITDA increased $9.6 million to $10.5 million, or 13.8% of net sales, compared to 1 million or 1.4% last year. In dollars, this was slightly below what we expected in August. The margin came in below our estimate of approximately 15.2%, reflecting the gross margin pressure I described. The year-over-year increase primarily reflects lower marketing expense as we lapped last year's slice launch, partially offset by lower gross profit and higher freight costs. On a segment basis, SujaCore adjusted EBITDA increased 4% to $13 million. Emerging Brands adjusted EBITDA was a loss of $2.4 million, an improvement of $9.1 million compared to the third quarter of 2025. Now to the balance sheet. In August, we completed the refinancing we mentioned on our last call. It includes a new $165 million term loan, that matures in 2031. We also increased our revolving credit facility and our delayed draw term loan to 50 million each. Both remain undrawn. Our effective interest rate is now 5.7% compared to 9.7% at the end of last year. As we said at the time, this was a cost of capital transaction and we did not add leverage. Interest expense in the quarter was 3.3 million compared to 7.6 million a year ago. In connection with the refinancing, we recognized a $1.8 million loss on debt extinguishment, which is excluded from adjusted EBITDA. As of September 28, 2026, we had cash of $15.5 million and total debt of $163 million, with $100 million of undrawn capacity under our revolving and delayed draw facilities. Capital expenditures were $18.6 million year-to-date as we continue to expand our capacity adding our sixth HPP machine in our Oceanside, California campus by year end. Turning to our outlook, as Maria noted, we're lowering our full year outlook to reflect continued pressure in grocery. For the full year ending December 28th, 2026, we now expect net sales of 351 million to 354 million and adjusted EBITDA of 68 million to 70 million. We continue to expect net interest expense of approximately $18 million, as previously communicated in our August refinancing announcement, and a base tax rate of 26.1%. To help with your modeling, our outlook implies fourth quarter net sales of $83.7 million to $86.7 million and adjusted EBITDA of $17.8 million to $19.8 million. A few things shape the fourth quarter. About 2 million of shipments moved into the third quarter. We expect trade investment to stay well above last year's level in a highly promotional environment, which weighs on both net sales and gross margin. And our outlook assumes today's grocery conditions hold through year end against the fourth quarter last year that benefited from stronger velocities. We also expect marketing to be lower as a percentage of net sales in the fourth quarter. as we redeploy upper funnel marketing dollars into trade programs to stay competitive in a heavily promoted category. As we outlined in August, we've been shifting investment from upper funnel marketing into trade. Because trade is recorded as a reduction of net sales, while marketing sits in SG&A, this shift reduces reported net sales and gross margin, but is largely neutral to adjusted EBITDA. Together with cost actions across the company, including freight optimization and tighter management of operating expenses, that supports adjusted EBITDA margin expansion despite lower gross margin. As Maria mentioned, we'll provide our formal 2027 outlook on our fourth quarter call in March. To help frame how we're thinking about next year, I'd point to a few considerations. First, The first quarter of 2026 benefited from favorable shipment timing and the timing of promotional activity, which we discussed in our first quarter call. So it's a demanding comparison. Second, our planning assumes continued pressure in grocery. Third, the contribution from new innovation and programs will build through the year rather than arrive at the start. Fourth, we expect promotional intensity to remain elevated and our planning doesn't assume a near-term recovery. And fifth, we'll be lapping a significant customer program that we don't expect to repeat. Taken together, we expect 2027 to start slower with growth improving as the year progresses and to come in below our long-term algorithm. In closing, the third quarter showed the strength of our brands and the durability of our business model in a demanding environment. We've lowered our cost of capital, we're managing the business for profitability, and we're focused on the actions Maria described to rebuild velocity and position Suja for consistent long-term top-line growth. With that, I'll turn it over to the operator for Q&A.

Thank you. At this time, we will conduct the question and answer session.

As a reminder, to ask a question, you will need to press star 1 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 1 again.

Please stand by while we compile the Q&A roster. Our first question comes from Bonnie Herzog with Goldman Sachs. Please go ahead.

All right. Thank you. Hi, everyone. So I think I understand the pressure in the grocery channel, you know, given the macro environment. But I guess I'm trying to understand why you're not seeing enough of your core customers still purchase your brands, even if it's in other channels. I guess, have they left the category entirely? Or are you possibly losing share? Maria, I know you mentioned you're taking share, but I guess I am trying to understand if this is ultimately a channel issue or more of a brand issue. and then in thinking about that, what is your strategy with promotions? You know, I guess how willing are you to ramp promo spend even further to potentially drive volume? Thanks.

Yes, so great question. First off, I mean, I think let's talk about the channels. We in Nielsen for Q3, we were down in the food channel by 1.7% and we were up significantly in Mass Club and Seastores which tells you we are translating our trade support where consumers are going. So I think that's part of your question. And so while we are raising our promo support in grocery to match our competitors, we are also very well aware of the channel shifting that we're seeing as consumers are looking for those promo dollars. And our retailers are telling us that in many cases, consumers are just chasing price. And so we are seeing channel shifting happen and we are adjusting our plans to go after that business. Second to that, when you asked about increasing our promo, we definitely have. So we have increased our promo dollars quarter to quarter and year over year in order to compete. We did make a decision and followed through with it that moved are higher level marketing dollars where we're using campaigns as an example and really went right after price and promotion at retail. And that has worked for us. We've been able to maintain and grow share, albeit 0.9% according to Nielsen and Q3, which one could say is on the lower side, but we're proud of that given that the category is down. So it's a very competitive market environment for sure, but we continue to take share. And, you know, we're always focused on really grabbing new distribution, growing our innovation, and really continuing to fuel that pipeline of growth.

Yeah, I would piggyback on that, Bonnie, and say that the other thing is we're looking at our business and across all of these channels, significant growth is coming for us in our multi-packs. and I think that's a good sign of consumers really looking for value as you see some of this channel shifting. But that's also helping to support a lot of the transition to routinization that we're seeing from a lot of our consumers as well.

So maybe just a quick follow up on that. So you touched on the category is declining. So just trying to understand then where are these consumers that potentially were drinking juice going? Where's the category they're losing share?

Yes, so in the spirit of just understanding the natural healthy beverage category, cold-pressed juice was up 1.5 share, shots were up 1.3, proteins were up 0.4, and coconut water was up 1.8. and then there are significant sized categories in sight of natural healthy beverage that are down. Kombucha is down 1.8, Better For You Soda is down 2.3, smoothies. So these are all share losers in the category, smoothies and pasteurized juices. So those categories are large and they drag quite heavily on the category if that helps frame it. Okay, thank you. I'll pass it on.

Thank you. Our next question comes from Komil Gajdrewala with Jefferies. Please go ahead.

Hey, guys. Good afternoon, I guess, for you guys. I guess I'm digging into the same sort of line of questions. I guess I want to understand a little bit more on the promo side. Is it that there's been increased promo activity to try to address an industry issue that perhaps hasn't been effective? Or I'm just trying to get inside of Some of your commentary around, I guess, the impact of the promos are and how you're going to go, you know, how you're going about things maybe differently in the coming in the coming quarters.

Yeah, so I'll start at a high level, which is what we we have feedback from our retail partners. Number one, they need to increase their foot traffic, particularly in grocery. As I was mentioning, you have consumers, you know, moving to different channels. So grocery needs the foot traffic. and they're willing to really drive value to get that foot traffic. And so they've been very proactive with their partners and it's not a category specific conversation. This is going on across the entire store and you're seeing it in all of the categories. If you listen to Albertsons or any of the earnings calls, I think they explain it very well. So we're not immune to that. We've had, I think, all of us step up on promo. The entire category, I think, is up almost 6% in promo versus where it was. And so it's a category-wide request to try and drive consumers to the segment and continue to drive foot traffic.

And we started to invest incrementally in promo, again, to match competition. We certainly don't want to dilute the category. Kamal, but we're also continuing to invest into Q4 and invest in areas where we think we can drive real return. Again, this kind of goes back to what I was mentioning to Bonnie earlier, where we see some growth in multipacks, and that's a great sign for consumers and routinization. So we're definitely investing in promotional activity there to help kind of drive the ring as the consumers are maybe making less trips to the store than they were in the past.

I think what we've seen, maybe to continue to answer the question, is when we run promotions, and I think we've seen the data across the board, it's not that people are not participating. They absolutely are participating in those promos. So that's the good sign. The bad sign is the velocity rates don't match what they used to be in the spirit of the pull off the shelf. And so that really is the trick. and our focus into the future, which is not only to drive promos, to drive traffic, but to make it sticky and to drive those velocity rates north of where they are today.

I got it. Are retailers shifting their focus on the category in any way? Is the category itself getting maybe more shelf space, less shelf space?

I think we continue to hear good... Yeah, no, I'd say we continue to hear very good signs. We have conversations with them. It's happening right now, right? We're in the spirit of selling season. Resets happen, you know, early next year all the way through springtime. And so we've gotten great indications of continued distribution growth and continued focus on the natural healthy beverage category. So that's been very positive.

Okay, got it. And then on gross margins, they came in at least below where I had expected it to be. Is there any big, you know, Big pieces in there that we should be aware of as we're modeling out the year.

Specifically for Q3, Kamal, I'd say there's kind of three elements in there. The first is the shift in incremental promotion. So we redeployed some upper funnel marketing dollars that would show up below gross margin. We redeployed those up into trade, which would be a contra revenue item. So that does drive down your net revenue and Your gross margin, it's largely neutral from an EBITDA perspective. That's a part of it. Another part that we saw was a little bit of negative absorption due to reduced production volumes. So we had some additional costs to deal with there. And then there were also some cost pressures largely tied to oil prices, inbound freight, and some of the commodity inputs like our packaging were affected. As we look to Q4, we do have some initiatives around operational efficiency and freight efficiency to help offset some of this, but we are expecting continued pressures from commodities like oil that we will have to continue to deal with.

Okay, got it.

Thank you.

Thank you. Our next question comes from Christian Junquero with Bank of America. Please go ahead.

Hey, it's Christian. I'm for Pete. Thanks for taking our question. First question, if I remember correctly, cold, flu season, and New Year, it's key for your business. So if you guys can talk about how you're preparing for that in terms of your supply chain and marketing. Did you guys see a strong benefit from cold, flu season, and New Year's last year? And is that also contributing to the tougher setup for 4Q and 1Q of next year? And I have a follow-up after. Thank you.

Yeah, so this is the cold and flu season that we're in as of right now. I can't tell you how many people I know that are dealing with it or have just begun. So sadly, that is true. So we build a lot of programs around that, around immunity season, immunity booths. We do a lot of campaigns at store level around that. You'll see a lot of secondary locations of wellness shots in stores starting from now all the way through into the new year. So that is a tremendous piece of our focus. We are lapping a pretty sizable flu season last year, so that is for sure true. And then what was the second part of your question?

The second question is, if I understand this correctly, the 4Q sales guidance implies that Sales down about mid-single digits. And, you know, I appreciate the color you guys gave for 2027, especially, you know, in terms of the first half. But, you know, how should we be thinking about applying that exit rate to 1Q and then, you know, we assume improvement? Or is that not the right exit rate to use for the first quarter of 27? And that's it. Thank you.

Yeah, so we expect 27 to be a growth year. I'll start with that. But the start will be slower given a first quarter comparison that included a heavy flu season, as you just described. And we expect growth to build each quarter with new distribution and our retailer programs and our innovation that will start coming online in the early spring. So while we're coming in below our growth algorithm, those are some of the main drivers.

Perfect. Thank you. Thank you. Our next question comes from Sean McGowan with Roth Capital Partners. Please go ahead.

Hi. Thanks for the opportunity to ask questions. First one is, is there a point in or what is the point in 2027 at which the year-over-year cost comparisons on freight and packaging kind of get easier because you're lapping that year-over-year comparison?

I would say, Sean, the majority of the pressures that we started to see came in Q3. There were a little bit of ramping on raw material inputs into Q1 and Q2, but there was a pretty significant step up in fuel for both freight in and freight out in Q3 that we expect into Q4. We also saw less labor availability for carriers to be able to carry our product. from a freight perspective, and that also contributed to the rate increase. So about halfway through the year, we would expect to see a softer lap next year.

Okay, that's helpful. Thank you. And then a little bit more on Slice, if you don't mind. It sounds like you're kind of dialing back a little bit there because of softness in the category, but doesn't it seem kind of early in its recovery or its reintroduction to be pulling back?

Yeah, so I wouldn't say we're pulling back. I would say that the category is showing softness. If you look at the data in the NHB section where you have the cold, better for you soda, that slices up 6%, which we're very proud of. And if you look at just a natural healthy beverage in the cold set, we are number two to Olipop, while we really have no number threes, fours, or fives in the category. So we feel good about that. and then also we have launched our dirty soda line our orange strawberry we've got a piña colada and a Dr. Pepper dirty soda now that we've just released and we've added quite a bit of distribution so when you look at our actual TDPs those are up and we've been adding distribution on the brand so I agree with you that it's too early to be doing anything in terms of pulling back We're just chasing the flavors and the opportunities at retail that suit the brand the best, and so we're really hyper-focused on that.

Okay, so maybe I misunderstood you. I thought you were saying you were dialing back the marketing. Is that just because you were copping against the launch or relaunch last year, but now it's lower than you had planned?

That's right. Our first year, we overspent because we were trying to break into a very busy category, so That was, you know, an intentional effort on the marketing side in 25. 26, we took a more right-sized approach based on the revenue of the brand and then also really building off of our incredible build of distribution in 25. So really it became about, you know, keeping our distribution and adding to it in 26.

Okay, thank you very much.

Thank you. Our next question comes from Glenn West with William Blair.

Please go ahead. Hi, everyone. This is Glenn on for John Anderson. Just something from my understanding, I know a lot of people watch this too, like the Nielsen data has been running meaningfully ahead of reported net sales growth and just looking at the month of October. It's been running pretty strong as well. Can you just help us bridge the gap? Like how much is explained by channel mix or trade investment that you guys are leaning into or like retailer inventories just to kind of help us moving forward? Thanks.

Yeah, so our scan data universe covers roughly about half of our business. Each provider, whether you're looking at Nielsen or Sarkana, do include different types of databases that do make the numbers somewhat different. We certainly are using Nielsen in our talking points, and we have curated a database for natural healthy beverage that we believe is the most accurate way to look at the business. It's very interesting you bring this up because obviously we see what analysts and investors look at as well and some of those differences. So we'll do our best to share the data and the Nielsen reports that we have to, you know, make sure that we stay on the same page with that.

And the Nielsen data that we're looking at is largely mirroring the growth that we've reported here. There are some differences, again, just in terms of ranges of growth, but they're all kind of in the mid-single-digit range that we've seen for Q3.

Okay, thank you. And then maybe just a quick follow-up if I can. I think you guys mentioned C-Store was a bright spot up like 40% or so. And then you talked about meaningful kind of distribution gains. heading into next year. I'm just curious if you guys are going to focus more on the C-Store channel. Maybe you could talk about what you're doing there. Thanks.

Yeah, so it's currently it's just 3% of our business. So it's small, but it is growing meaningfully. And that is, as you say, on the back of increased distribution on our brands. We have found that our wellness shots work very well in locations like Wawa, where we have continued to see expanded growth. And we are very much about growing that footprint into 2027. So we have concerted effort on that, not only from a team priority, but obviously from an investment as well.

Awesome. Thank you, guys. I'll pass it on.

Thank you.

Our next question comes from Robert Ottenstein with Evercore ISI.

Please go ahead.

Yes, two points of just clarification or elaboration. Can you just give us a little bit more detail in terms of what's going on with your shot business? Is it all just tough comps with the flu season? How was your share on both of your brands?

That's the first question.

And then the second, I was a little bit unclear. You did mention some impressive distribution gains. Is that all slice or are you seeing that broadly in 2027? Thank you.

Yes. So I'll start with distribution. We are adding distribution across the board. Some of the bigger opportunities for us are obviously our boosted juice line is doing very well. Our refresher line is doing well. We have big plans on our shots business. So it is across the board in terms of overall distribution gains. So that's that portion of the question. And then as it relates to our shots business, we saw some disruptor brands in the category go after very deep discounts. to the tune of 50% to 60% of their volume being sold on promotion, which is sort of an unheard of percentage. And so we had decided to take an initiative to match their pricing at retail and then really go after and make sure that we're protecting our market share, which is what has happened. So we were able to protect Life's market share as well as Suja Shots for the most part. And we see our trends in the most recent weeks actually turning around as we've done that. So the spend has been a smart move on our part. We met them toe to toe and we feel like we're in the right trajectory now.

And I would also say that it's scaling up, Robert. It does take time to add incremental activity with many of your retail partners. So we saw this starting to come on towards the end of Q3 and expect to have, you know, much, much greater effect throughout Q4 as we've added incremental promotional activity and opportunities.

We also just for this added perspective, as we step into twenty seven going after new distribution, as well as some really exciting innovation, I'll be excited to share with you in March.

Terrific, thank you.

Thank you. I'm showing no further questions at this time thank you for your participation in today's conference this concludes the program you may now disconnect