Item 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

​

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF MARCH 31, 2024 AND DECEMBER 31, 2023

(In Thousands, Except Par Value) (Unaudited)

​

​	​	​	​	​	​	​
​	​	March 31,		​	December 31,
​		2024			2023
ASSETS	​	​	​	​	​	​
CURRENT ASSETS:	​	​	​	​	​	​
Cash and cash equivalents	​	$	2,576,524	​	$	2,297,675
Short-term investments	​		984,201			955,605
Accounts receivable, net	​		1,370,239			1,193,964
Inventories	​		939,630			971,406
Prepaid expenses and other current assets	​		124,580			116,195
Prepaid income taxes	​		40,340			54,151
Total current assets	​		6,035,514			5,588,996
​	​	​	​	​	​	​
INVESTMENTS	​		8,162			76,431
PROPERTY AND EQUIPMENT, net	​		923,290			890,796
DEFERRED INCOME TAXES, net	​		175,271			175,003
GOODWILL	​		1,417,941			1,417,941
OTHER INTANGIBLE ASSETS, net	​		1,430,762			1,427,139
OTHER ASSETS	​		107,126			110,216
Total Assets	​	$	10,098,066		$	9,686,522
​	​	​	​	​	​	​
LIABILITIES AND STOCKHOLDERS’ EQUITY	​	​	​	​	​	​
CURRENT LIABILITIES:	​	​	​	​	​	​
Accounts payable	​	$	533,729		$	564,379
Accrued liabilities	​		204,679			183,988
Accrued promotional allowances	​		318,895			269,061
Deferred revenue	​		43,776			41,914
Accrued compensation	​		52,638			87,392
Income taxes payable	​		75,111			14,955
Total current liabilities	​		1,228,828			1,161,689
​	​	​	​	​	​	​
DEFERRED REVENUE	​		198,759			204,251
​	​	​	​	​	​	​
OTHER LIABILITIES	​	​	92,690	​	​	91,838
​	​	​	​	​	​	​
COMMITMENTS AND CONTINGENCIES (Note 11)	​	​	​	​	​	​
​	​	​	​	​	​	​
STOCKHOLDERS’ EQUITY:	​	​	​	​	​	​
Common stock - $0.005 par value; 5,000,000 shares authorized; 1,124,870 shares issued and 1,041,698 shares outstanding as of March 31, 2024; 1,122,592 shares issued and 1,041,571 shares outstanding as of December 31, 2023	​	​	5,624	​	​	5,613
Additional paid-in capital	​		5,034,948			4,975,115
Retained earnings	​		6,381,785			5,939,736
Accumulated other comprehensive loss	​		(157,940)			(125,337)
Common stock in treasury, at cost; 83,172 shares and 81,021 shares as of March 31, 2024 and December 31, 2023, respectively	​		(2,686,628)			(2,566,383)
Total stockholders’ equity	​		8,577,789			8,228,744
Total Liabilities and Stockholders’ Equity	​	$	10,098,066		$	9,686,522

​

See accompanying notes to condensed consolidated financial statements.

​

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

FOR THE THREE-MONTHS ENDED MARCH 31, 2024 AND 2023

(In Thousands, Except Per Share Amounts) (Unaudited)

​

​	​	​	​	​	​	​
​	​	Three-Months Ended
​	​	March 31,
​		2024			2023
​	​	​	​	​	​	​
NET SALES	​	$	1,899,098	​	$	1,698,930
​	​	​	​	​	​	​
COST OF SALES	​		871,969	​		801,081
​	​	​	​	​	​	​
GROSS PROFIT	​		1,027,129	​		897,849
​	​	​	​	​	​	​
OPERATING EXPENSES	​		485,138	​		412,785
​	​	​	​	​	​	​
OPERATING INCOME	​		541,991	​		485,064
​	​	​	​	​	​	​
INTEREST and OTHER INCOME, net	​		35,754	​		12,496
​	​	​	​	​	​	​
INCOME BEFORE PROVISION FOR INCOME TAXES	​		577,745	​		497,560
​	​	​	​	​	​	​
PROVISION FOR INCOME TAXES	​	​	135,696	​	​	100,116
​	​	​	​	​	​	​
NET INCOME	​	$	442,049	​	$	397,444
​	​	​	​	​	​	​
NET INCOME PER COMMON SHARE:	​	​	​	​	​	​
Basic	​	$	0.42	​	$	0.38
Diluted	​	$	0.42	​	$	0.38
​	​	​	​	​	​	​
WEIGHTED AVERAGE NUMBER OF SHARES OF COMMON STOCK AND COMMON STOCK EQUIVALENTS:	​	​	​	​	​	​
Basic	​		1,041,081	​		1,044,909
Diluted	​		1,051,282	​		1,059,069

​

See accompanying notes to condensed consolidated financial statements.

​

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

FOR THE THREE-MONTHS ENDED MARCH 31, 2024 AND 2023

(In Thousands) (Unaudited)

​

​	​	​	​	​	​	​
​	​	Three-Months Ended
​	​	March 31,
​		2024			2023
Net income, as reported	​	$	442,049	​	$	397,444
Other comprehensive income (loss):	​	​	​	​	​	​
Change in foreign currency translation adjustment	​		(30,695)	​		7,981
Change in net unrealized gain (loss) on available-for-sale investments	​		223	​		3,181
Change in net gain (loss) on commodity derivatives	​		(2,131)	​		—
Other comprehensive income (loss)	​		(32,603)	​		11,162
Comprehensive income	​	$	409,446	​	$	408,606

​

See accompanying notes to condensed consolidated financial statements.

​

​

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

FOR THE THREE-MONTHS ENDED MARCH 31, 2024 AND 2023

(In Thousands) (Unaudited)

​

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	Accumulated Other		​	​	​	​	​	​	Total
​	​	Common stock				​	Additional		​	Retained		​	Comprehensive (Loss)		​	Treasury stock				​	Stockholders’
​		Shares		Amount			Paid-in Capital			Earnings			Income			Shares		Amount			Equity
Balance, December 31, 2023	​	1,122,592	​	$	5,613	​	$	4,975,115	​	$	5,939,736	​	$	(125,337)	​	(81,021)	​	$	(2,566,383)	​	$	8,228,744
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Stock-based compensation		—	​	​	—	​	​	21,452	​	​	—	​	​	—	​	—	​	​	—	​	​	21,452
Stock options/awards		2,278	​	​	11	​	​	38,381	​	​	—	​	​	—	​	—	​	​	—	​	​	38,392
Unrealized gain (loss), net on available-for-sale securities		—	​		—	​		—	​		—	​		223		—	​		—	​		223
Repurchase of common stock	​	—	​	​	—	​	​	—	​	​	—	​	​	—	​	(2,151)	​	​	(120,245)	​	​	(120,245)
Foreign currency translation		—	​	​	—	​	​	—	​	​	—	​	​	(30,695)	​	—	​	​	—	​	​	(30,695)
Net gain (loss) on commodity derivatives	​	—	​	​	—	​	​	—	​	​	—	​	​	(2,131)	​	—	​	​	—	​	​	(2,131)
Net income		—	​	​	—	​	​	—	​	​	442,049	​	​	—	​	—	​	​	—	​	​	442,049
​		​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Balance, March 31, 2024		1,124,870	​	$	5,624	​	$	5,034,948	​	$	6,381,785	​	$	(157,940)	​	(83,172)	​	$	(2,686,628)	​	$	8,577,789

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	Accumulated Other		​	​	​	​	​	​	Total
​	​	Common stock				​	Additional		​	Retained		​	Comprehensive (Loss)		​	Treasury stock				​	Stockholders’
​		Shares		Amount			Paid-in Capital			Earnings			Income			Shares		Amount			Equity
Balance, December 31, 2022	​	1,283,688	​	$	6,418	​	$	4,776,804	​	$	9,001,173	​	$	(159,073)	​	(239,088)	​	$	(6,600,281)	​	$	7,025,041
​		​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Stock-based compensation		—	​	​	—	​	​	15,743	​	​	—	​	​	—	​	—	​	​	—	​	​	15,743
Stock options/awards		3,704	​		19	​		36,329	​		—	​		—		—	​		—	​		36,348
Unrealized gain (loss), net on available-for-sale securities		—	​	​	—	​	​	—	​	​	—	​	​	3,181	​	—	​	​	—	​	​	3,181
Repurchase of common stock	​	—	​	​	—	​	​	—	​	​	—	​	​	—	​	(1,688)	​	​	(90,378)	​	​	(90,378)
Retirement of treasury stock	​	(170,000)	​	​	(850)	​	​	425	​	​	(4,692,425)	​	​	—	​	170,000	​	​	4,692,850	​	​	—
Foreign currency translation		—	​	​	—	​	​	—	​	​	—	​	​	7,981	​	—	​	​	—	​	​	7,981
Net income		—	​	​	—	​	​	—	​	​	397,444	​	​	—	​	—	​	​	—	​	​	397,444
​		​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Balance, March 31, 2023		1,117,392		$	5,587		$	4,829,301		$	4,706,192		$	(147,911)	​	(70,776)		$	(1,997,809)		$	7,395,360

​

See accompanying notes to condensed consolidated financial statements.

​

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE-MONTHS ENDED MARCH 31, 2024 AND 2023

(In Thousands) (Unaudited)

​

​	​	​	​	​	​	​
​	​	Three-Months Ended
​	​	March 31,
​		2024			2023
CASH FLOWS FROM OPERATING ACTIVITIES:	​	​	​	​	​	​
Net income	​	$	442,049	​	$	397,444
Adjustments to reconcile net income to net cash provided by operating activities:	​	​	​	​	​	​
Depreciation and amortization	​	​	20,475	​	​	16,808
Non-cash lease expense	​	​	3,185	​	​	2,160
Gain on disposal of property and equipment	​	​	(177)	​	​	(385)
Stock-based compensation	​	​	22,472	​	​	16,051
Deferred income taxes	​	​	9	​	​	—
Effect on cash of changes in operating assets and liabilities:	​	​	​	​	​	​
Accounts receivable	​	​	(195,081)	​	​	(167,512)
Inventories	​	​	22,708	​	​	35,495
Prepaid expenses and other assets	​	​	(9,507)	​	​	1,273
Prepaid income taxes	​	​	11,840	​	​	3,986
Accounts payable	​	​	(9,062)	​	​	51,124
Accrued liabilities	​	​	28,259	​	​	14,207
Accrued promotional allowances	​	​	52,814	​	​	48,265
Accrued compensation	​	​	(35,653)	​	​	(30,261)
Income taxes payable	​	​	60,512	​	​	41,617
Other liabilities	​	​	335	​	​	(751)
Deferred revenue	​	​	(3,036)	​	​	(5,046)
Net cash provided by operating activities	​	​	412,142	​	​	424,475
​	​	​	​	​	​	​
CASH FLOWS FROM INVESTING ACTIVITIES:	​	​	​	​	​	​
Sales of available-for-sale investments	​	​	382,125	​	​	522,501
Purchases of available-for-sale investments	​	​	(342,228)	​	​	(518,751)
Purchases of property and equipment	​	​	(66,044)	​	​	(40,100)
Proceeds from sale of property and equipment	​	​	422	​	​	564
Additions to intangibles	​	​	(8,612)	​	​	(3,952)
Increase in other assets	​	​	(985)	​	​	(13,028)
Net cash used in investing activities	​	​	(35,322)	​	​	(52,766)
​	​	​	​	​	​	​
CASH FLOWS FROM FINANCING ACTIVITIES:	​	​	​	​	​	​
Payments on debt	​	​	(2,896)	​	​	(7,271)
Issuance of common stock	​	​	38,392	​	​	36,348
Purchases of common stock held in treasury	​	​	(120,245)	​	​	(35,126)
Net cash used in financing activities	​	​	(84,749)	​	​	(6,049)
​	​	​	​	​	​	​
Effect of exchange rate changes on cash and cash equivalents	​	​	(13,222)	​	​	(141)
​	​	​	​	​	​	​
NET INCREASE IN CASH AND CASH EQUIVALENTS	​	​	278,849	​	​	365,519
CASH AND CASH EQUIVALENTS, beginning of period	​	​	2,297,675	​	​	1,307,141
CASH AND CASH EQUIVALENTS, end of period	​	$	2,576,524	​	$	1,672,660
​	​	​	​	​	​	​
SUPPLEMENTAL INFORMATION:	​	​	​	​	​	​
Cash paid during the period for:	​	​	​	​	​	​
Interest	​	$	91	​	$	96
Income taxes	​	$	63,634	​	$	56,985

​

See accompanying notes to condensed consolidated financial statements.

​

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE-MONTHS ENDED MARCH 31, 2024 AND 2023

(In Thousands) (Unaudited) (Continued)

SUPPLEMENTAL DISCLOSURE OF NON-CASH ITEMS

Included in accrued liabilities as of March 31, 2024 and 2023 were $11.7 million and $9.6 million, respectively, related to net additions to other intangible assets.

Included in accounts payable as of March 31, 2024 and 2023 were $3.2 million and $2.5 million, respectively, related to equipment purchases.

Included in accounts receivable as of March 31, 2024 was $3.0 million related to available-for-sale short-term investment sales.

Included in accrued liabilities as of March 31, 2023 was $55.3 million of withholding taxes due related to common stock purchased from employees.

See accompanying notes to condensed consolidated financial statements.

​

​

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

1.	BASIS OF PRESENTATION

Reference is made to the Notes to Consolidated Financial Statements, in Monster Beverage Corporation and Subsidiaries (the “Company”) Annual Report on Form 10-K for the year ended December 31, 2023 for a summary of significant accounting policies utilized by the Company and its consolidated subsidiaries and other disclosures, which should be read in conjunction with this Quarterly Report on Form 10-Q (“Form 10-Q”).

The Company’s condensed consolidated financial statements included in this Form 10-Q have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and Securities and Exchange Commission (“SEC”) rules and regulations applicable to interim financial reporting. They do not include all the information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP. The information set forth in these interim condensed consolidated financial statements for the three-months ended March 31, 2024 and 2023, respectively, is unaudited and reflects all adjustments, which include only normal recurring adjustments and which in the opinion of management are necessary to make the interim condensed consolidated financial statements not misleading. Results of operations for periods covered by this report may not necessarily be indicative of results of operations for the full year.

The preparation of financial statements in conformity with GAAP necessarily requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from these estimates.

Recent Accounting Pronouncements

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments in this update improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments in ASU No. 2023-07 are effective for fiscal years beginning after December 15, 2023. Early adoption is permitted. The Company is currently evaluating the impact ASU No. 2023-07 will have on its consolidated financial statements.

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments in this update primarily require more detailed disclosures related to the rate reconciliation and income taxes paid. The amendments in ASU No. 2023-09 are effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company is currently evaluating the impact ASU No. 2023-09 will have on its consolidated financial statements.

​

2.	REVENUE RECOGNITION

Revenues are accounted for in accordance with FASB Accounting Standards Codification (“ASC”) 606, “Revenue from Contracts with Customers”. The Company has four operating and reportable segments: (i) Monster Energy® Drinks segment (“Monster Energy® Drinks”), which is primarily comprised of the Company’s Monster Energy® drinks, Reign Total Body Fuel® high performance energy drinks, Reign Storm® total wellness energy drinks, Bang Energy® drinks and Monster Tour Water®, (ii) Strategic Brands segment (“Strategic Brands”), which is primarily comprised of the various energy drink brands acquired from The Coca-Cola Company (“TCCC”) in 2015 as well as the Company’s affordable energy brands, Predator® and Fury®, (iii) Alcohol Brands segment (“Alcohol Brands”), which is comprised of various craft beers, hard seltzers and flavored malt beverages (“FMBs”) and (iv) Other segment (“Other”), which is comprised of certain products sold by American Fruits and Flavors, LLC, a wholly-owned subsidiary of the Company, to independent third-party customers (the “AFF Third-Party Products”).

The Company’s Monster Energy® Drinks segment primarily generates net operating revenues by selling ready-to-drink packaged drinks primarily to bottlers and full service beverage distributors (“bottlers/distributors”). In some cases, the Company sells ready-to-drink packaged drinks directly to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience and gas chains, drug stores, foodservice customers, value stores, e-commerce retailers and the military.

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

The Company’s Strategic Brands segment primarily generates net operating revenues by selling “concentrates” and/or “beverage bases” to authorized bottling and canning operations. Such bottlers generally combine the concentrates and/or beverage bases with sweeteners, water and other ingredients to produce ready-to-drink packaged energy drinks. The ready-to-drink packaged energy drinks are then sold by such bottlers to other bottlers/distributors and to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience and gas chains, foodservice customers, drug stores, value stores, e-commerce retailers and the military. To a lesser extent, the Strategic Brands segment generates net operating revenues by selling certain ready-to-drink packaged energy drinks to bottlers/distributors.

The Company’s Alcohol Brands segment primarily generates operating revenues by selling kegged and ready-to-drink canned beers, hard seltzers and FMBs primarily to beer distributors in the United States.

The majority of the Company’s revenue is recognized when it satisfies a single performance obligation by transferring control of its products to a customer. Control is generally transferred when the Company’s products are either shipped or delivered based on the terms contained within the underlying contracts or agreements. Certain of the Company’s bottlers/distributors may also perform a separate function as a co-packer on the Company’s behalf. In such cases, control of the Company’s products passes to such bottlers/distributors when they notify the Company that they have taken possession or transferred the relevant portion of the Company’s finished goods. The Company’s general payment terms are short-term in duration. The Company does not have significant financing components or payment terms. The Company did not have any material unsatisfied performance obligations as of March 31, 2024 and December 31, 2023.

The Company excludes from revenues all taxes assessed by a governmental authority that are imposed on the sale of its products and collected from customers.

Distribution expenses to transport the Company’s products, where applicable, and warehousing expenses after manufacture are accounted for within operating expenses.

Promotional and other allowances (variable consideration) recorded as a reduction to net sales for the Company’s energy drink products primarily include consideration given to the Company’s non-alcohol bottlers/distributors or retail customers, including, but not limited to, the following:

	●	discounts granted off list prices to support price promotions to end-consumers by retailers;

	●	reimbursements given to the Company’s bottlers/distributors for agreed portions of their promotional spend with retailers, including slotting, shelf space allowances and other fees for both new and existing products;

	●	the Company’s agreed share of fees given to bottlers/distributors and/or directly to retailers for advertising, in-store marketing and promotional activities;

	●	the Company’s agreed share of slotting, shelf space allowances and other fees given directly to retailers, club stores and/or wholesalers;

	●	incentives given to the Company’s bottlers/distributors and/or retailers for achieving or exceeding certain predetermined sales goals;

	●	discounted or free products;

	●	contractual fees given to the Company’s bottlers/distributors related to sales made directly by the Company to certain customers that fall within the bottlers’/distributors’ sales territories; and

	●	commissions to TCCC based on the Company’s sales to wholly-owned subsidiaries of TCCC (the “TCCC Subsidiaries”) and/or to TCCC bottlers/distributors accounted for under the equity method by TCCC (the “TCCC Related Parties”).

​

The Company’s promotional allowance programs for its energy drink products are executed through separate agreements in the ordinary course of business. These agreements generally provide for one or more of the arrangements described above and are of varying durations, typically ranging from one week to one year. The Company’s promotional and other allowances for its energy drink products are calculated based on various programs with bottlers/distributors and retail customers, and accruals are established at the time of initial product sale for the Company’s anticipated liabilities. These accruals are based on agreed upon terms as well as the Company’s historical experience with similar programs and require management’s judgment with respect to estimating consumer participation and/or bottler/distributor and retail customer performance levels. Differences between such estimated expenses and actual

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

expenses for promotional and other allowance costs have historically been insignificant and are recognized in earnings in the period such differences are determined. Promotional and other allowances for our Alcohol Brands segment primarily include price promotions where permitted.

Amounts received pursuant to new and/or amended distribution agreements entered into with certain bottlers/distributors relating to the costs associated with terminating the Company’s prior distributors, are accounted for as deferred revenue and recognized as revenue ratably over the anticipated life of the respective distribution agreements, generally over 20 years.

The Company also enters into license agreements that generate revenues associated with third-party sales of non-beverage products bearing the Company’s trademarks including, but not limited to, clothing, hats, t-shirts, jackets, helmets and automotive wheels.

Management believes that adequate provision has been made for cash discounts, returns and spoilage based on the Company’s historical experience.

Disaggregation of Revenue

The following tables disaggregate the Company’s revenue by geographical markets and reportable segments:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Three-Months Ended March 31, 2024
​	​	​	​		​	​		​	​		Latin			​	​
​	​	​	​	​	​	​	​	Asia Pacific		​	America		​		​
​	​	U.S. and		​	​	​	​	(including		​	and		​		​
Net Sales		Canada			EMEA1			Oceania)			Caribbean			Total
Monster Energy® Drinks	​	$	1,094,846	​	$	352,229	​	$	122,018	​	$	159,958	​	$	1,729,051
Strategic Brands	​		49,642	​		43,337	​		9,197	​		6,268	​		108,444
Alcohol Brands	​	​	56,070	​	​	—	​	​	—	​	​	—	​	​	56,070
Other	​		5,533	​		—	​		—	​		—	​		5,533
Total Net Sales	​	$	1,206,091	​	$	395,566	​	$	131,215	​	$	166,226	​	$	1,899,098

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Three-Months Ended March 31, 2023
​	​	​	​		​	​		​	​		Latin		​		​
​	​	​	​	​	​	​	​	Asia Pacific		​	America		​	​	​
​	​	U.S. and		​	​	​	​	(including		​	and		​	​	​
Net Sales		Canada			EMEA1			Oceania)			Caribbean			Total
Monster Energy® Drinks	​	$	1,021,328	​	$	277,111	​	$	121,994	​	$	141,235	​	$	1,561,668
Strategic Brands	​	​	43,043	​		30,951	​		8,983	​		3,381	​		86,358
Alcohol Brands	​	​	46,290	​	​	—	​	​	—	​	​	—	​	​	46,290
Other	​	​	4,614	​		—	​		—	​		—	​		4,614
Total Net Sales	​	$	1,115,275	​	$	308,062	​	$	130,977	​	$	144,616	​	$	1,698,930

​

1_Europe, Middle East and Africa (“EMEA”)_

​

Contract Liabilities

Amounts received from certain bottlers/distributors at inception of their distribution contracts or at the inception of certain sales/marketing programs are accounted for as deferred revenue. As of March 31, 2024, the Company had $242.5 million of deferred revenue, which is included in current and long-term deferred revenue in the Company’s condensed consolidated balance sheet. As of December 31, 2023, the Company had $246.2 million of deferred revenue, which is included in current and long-term deferred revenue in the Company’s condensed consolidated balance sheet. During both the three-months ended March 31, 2024 and 2023, $9.9 million of deferred revenue was recognized in net sales. See Note 10.

​

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

3.	LEASES

The Company leases identified assets consisting primarily of office and warehouse space, warehouse equipment and vehicles. Leases are classified as either finance leases or operating leases based on criteria in ASC 842, “Leases”. The Company’s leases have remaining lease terms of less than one year to 10 years, some of which include options to extend the leases for up to five years, and some of which include options to terminate the leases within one year.

The components of lease cost were as follows:

​

​	​	​	​	​	​	​
​	​	Three-Months Ended March 31,
​		2024			2023
Operating lease cost	​	$	3,802	​	$	2,467
Short-term lease cost	​		2,670	​		979
Variable lease cost	​		213	​		215
​	​	​	​	​	​	​
Finance leases:	​	​	​	​	​	​
Amortization of right-of-use assets	​		595	​		123
Interest on lease liabilities	​		91	​		14
Finance lease cost	​		686	​		137
​	​	​	​	​	​	​
Total lease cost	​	$	7,371	​	$	3,798

​

Supplemental cash flow information was as follows:

​

​	​	​	​	​	​	​
​	​	Three-Months Ended March 31,
​		2024			2023
Cash paid for amounts included in the measurement of lease liabilities:	​	​	​	​	​	​
Operating cash outflows from operating leases	​	$	3,607	​	$	2,391
Operating cash outflows from finance leases	​	​	91	​	​	14
Financing cash outflows from finance leases	​	​	2,897	​	​	598
​	​	​	​	​	​	​
Right-of-use assets obtained in exchange for lease obligations:	​	​	​	​	​	​
Finance leases	​	​	747	​	​	2,227
Operating leases	​	​	1,091	​	​	313

​

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

Supplemental balance sheet information was as follows:

​

​	​	​	​	​	​	​	​	​
​		​		March 31,			December 31,
​	​	Balance Sheet Location	​	2024		​	2023
Operating leases:				​			​
Right-of-use assets		Other assets	​	$	56,421	​	$	58,845
​	​	​	​	​	​	​	​	​
Current lease liabilities		Accrued liabilities	​	$	11,122	​	$	11,088
Noncurrent lease liabilities		Other liabilities	​		46,474	​		48,459
Total operating lease liabilities			​	$	57,596	​	$	59,547
​	​	​	​	​	​	​	​	​
Finance leases:			​			​
Right-of-use assets		Property and equipment, net	​	$	10,091	​	$	11,147
​	​	​	​	​	​	​	​	​
Current lease liabilities		Accrued liabilities	​	$	4,297	​	$	6,449
Noncurrent lease liabilities		Other liabilities	​		14	​		19
Total finance lease liabilities			​	$	4,311	​	$	6,468

​

Weighted-average remaining lease term and weighted-average discount rate for the Company’s leases were as follows:

​

​	​	​	​	​	​
​		March 31, 2024		December 31, 2023	​
Weighted-average remaining lease term in years:	​	​	​	​	​
Operating leases	​	6.2		6.3	​
Finance leases	​	0.5	​	0.7	​
​	​	​	​	​	​
Weighted-average discount rate:	​	​	​	​	​
Operating leases	​	4.7	%	4.7	%
Finance leases	​	6.3	%	6.3	%

​

The following table outlines maturities of the Company’s lease liabilities as of March 31, 2024:

​

​	​	​	​	​	​	​
​		Undiscounted Future Lease Payments
​		Operating Leases			Finance Leases
2024 (from April 1, 2024 to December 31, 2024)	​	$	10,213	​	$	4,275
2025	​		11,942	​		118
2026	​		9,824	​		2
2027	​		9,242	​		—
2028	​	​	7,709	​	​	—
2029 and thereafter	​		17,820	​		—
Total lease payments	​		66,750	​		4,395
Less imputed interest	​		(9,154)	​		(84)
Total	​	$	57,596	​	$	4,311

​

As of March 31, 2024, the Company did not have any significant leases that had not yet commenced.

​

​

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

4.	INVESTMENTS

The following table summarizes the Company’s investments at:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	Continuous		​	Continuous
​	​	​	​	​	Gross		​	Gross		​	​	​	​	Unrealized		​	Unrealized
​	​	​	​	​	Unrealized		​	Unrealized		​	​	​	​	Loss Position		​	Loss Position
​	​	Amortized		​	Holding		​	Holding		​	Fair		​	less than 12		​	greater than 12
March 31, 2024		Cost			Gains			Losses			Value			Months			Months
Available-for-sale	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Short-term:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Commercial paper	​	$	157,074	​	$	11	​	$	—	​	$	157,085	​	$	—	​	$	—
Certificates of deposit	​	​	24,831	​	​	—	​	​	—	​	​	24,831	​	​	—	​	​	—
U.S. government agency securities	​		101,893	​		16	​		54	​		101,855	​		54	​		—
U.S. treasuries	​	​	530,697	​		23	​		390	​		530,330	​		390	​		—
Corporate bonds	​	​	170,198	​	​	32	​	​	130	​	​	170,100	​	​	130	​	​	—
Long-term:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Corporate bonds	​	​	8,205	​	​	—	​	​	43	​	​	8,162	​	​	43	​	​	—
Total	​	$	992,898	​	$	82	​	$	617	​	$	992,363	​	$	617	​	$	—

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	Continuous		​	Continuous
​	​	​	​	​	Gross		​	Gross		​	​	​	​	Unrealized		​	Unrealized
​	​	​	​	​	Unrealized		​	Unrealized		​	​	​	​	Loss Position		​	Loss Position
​	​	Amortized		​	Holding		​	Holding		​	Fair		​	less than 12		​	greater than 12
December 31, 2023		Cost			Gains			Losses			Value			Months			Months
Available-for-sale	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Short-term:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Commercial paper	​	$	163,775	​	$	—	​	$	1	​	$	163,774	​	$	1	​	$	—
Certificates of deposit	​	​	15,590	​	​	—	​	​	—	​	​	15,590	​	​	—	​	​	—
Municipal securities	​		361	​		—	​		—	​		361	​		—	​		—
U.S. government agency securities	​		116,524	​		90	​		66	​		116,548	​		66	​		—
U.S. treasuries	​	​	412,936	​	​	205	​	​	1,084	​	​	412,057	​	​	1,084	​	​	—
Corporate bonds	​	​	247,340	​	​	89	​	​	154	​	​	247,275	​	​	154	​	​	—
Long-term:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
U.S. government agency securities	​	​	23,485	​	​	51	​	​	5	​	​	23,531	​	​	5	​	​	—
U.S. treasuries	​	​	35,896	​	​	79	​	​	8	​	​	35,967	​	​	8	​	​	—
Corporate bonds	​	​	16,903	​	​	32	​	​	2	​	​	16,933	​	​	2	​	​	—
Total	​	$	1,032,810	​	$	546	​	$	1,320	​	$	1,032,036	​	$	1,320	​	$	—

​

During the three-months ended March 31, 2024 and 2023, realized gains or losses recognized on the sale of investments were not significant.

The Company’s investments at March 31, 2024 and December 31, 2023 carried investment grade credit ratings.

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

The following table summarizes the underlying contractual maturities of the Company’s investments at:

​

​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	March 31, 2024					​	December 31, 2023
​		Amortized Cost			Fair Value			Amortized Cost			Fair Value
Less than 1 year:	​	​	​	​	​	​	​	​	​	​	​	​
Commercial paper	​	$	157,074	​	$	157,085		$	163,775	​	$	163,774
Municipal securities	​		—	​		—			361	​		361
U.S. government agency securities	​		101,893	​		101,855			116,524	​		116,548
Certificates of deposit	​		24,831	​		24,831			15,590	​		15,590
U.S. treasuries	​	​	530,697	​	​	530,330	​	​	412,936	​	​	412,057
Corporate bonds	​	​	170,198	​	​	170,100	​	​	247,340	​	​	247,275
Due 1 - 10 years:	​	​	​	​	​	​	​	​	​	​	​	​
U.S. treasuries	​	​	—	​	​	—	​	​	35,896	​	​	35,967
U.S. government agency securities	​		—	​		—			23,485	​		23,531
Corporate bonds	​	​	8,205	​	​	8,162	​	​	16,903	​	​	16,933
Total	​	$	992,898	​	$	992,363		$	1,032,810	​	$	1,032,036

​

​

5.	FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES

ASC 820, “Fair Value Measurement”, provides a framework for measuring fair value and requires disclosures regarding fair value measurements. ASC 820 defines fair value as the price that would be received on the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 also establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs, where available. The three levels of inputs required by the standard that the Company uses to measure fair value are summarized below.

	●	Level 1: Quoted prices in active markets for identical assets or liabilities.

	●	Level 2: Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities.

	●	Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

ASC 820 requires the use of observable market inputs (quoted market prices) when measuring fair value and requires a Level 1 quoted price to be used to measure fair value whenever possible.

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

The following tables present the fair value of the Company’s financial assets and liabilities that are recorded at fair value on a recurring basis, segregated among the appropriate levels within the fair value hierarchy at:

​

​	​	​	​	​	​	​	​	​	​	​	​	​
March 31, 2024		Level 1			Level 2			Level 3			Total
Cash	​	$	973,260	​	$	—	​	$	—	​	$	973,260
Money market funds	​		1,026,552	​		—	​		—	​		1,026,552
Certificates of deposit	​	​	—	​	​	74,208	​	​	—	​	​	74,208
Commercial paper	​		—	​		193,959	​		—	​		193,959
Corporate bonds	​	​	—	​	​	205,924	​	​	—	​	​	205,924
U.S. government agency securities	​		—	​		146,214	​		—	​		146,214
U.S. treasuries	​	​	—	​	​	948,770	​	​	—	​	​	948,770
Foreign currency derivatives	​		—	​		(591)	​		—	​		(591)
Commodity derivatives	​		—	​		2,279	​		—	​		2,279
Total	​	$	1,999,812	​	$	1,570,763	​	$	—	​	$	3,570,575
​	​	​	​	​	​	​	​	​	​	​	​	​
Amounts included in:	​	​	​	​	​	​	​	​	​	​	​	​
Cash and cash equivalents	​	$	1,999,812	​	$	576,712	​	$	—	​	$	2,576,524
Short-term investments	​		—	​		984,201	​		—	​		984,201
Accounts receivable, net	​		—	​		2,981	​		—	​		2,981
Other assets	​	​	—	​	​	332	​	​	—	​	​	332
Investments	​		—	​		8,162	​		—	​		8,162
Accrued liabilities	​		—	​		(1,625)	​		—	​		(1,625)
Total	​	$	1,999,812	​	$	1,570,763	​	$	—	​	$	3,570,575

​

​	​	​	​	​	​	​	​	​	​	​	​	​
December 31, 2023		Level 1			Level 2			Level 3			Total
Cash	​	$	1,105,701	​	$	—	​	$	—	​	$	1,105,701
Money market funds	​		960,873	​		—	​		—	​		960,873
Certificates of deposit	​	​	—	​	​	33,824	​	​	—	​	​	33,824
Commercial paper	​		—	​		163,774	​		—	​		163,774
Corporate bonds	​	​	—	​	​	264,208	​	​	—	​	​	264,208
Municipal securities	​		—	​		361	​		—	​		361
U.S. government agency securities	​		—	​		159,585	​		—	​		159,585
U.S. treasuries	​	​	—	​	​	641,385	​	​	—	​	​	641,385
Foreign currency derivatives	​		—	​		(1,083)	​		—	​		(1,083)
Commodity derivatives	​	​	—	​	​	4,410	​	​	—	​	​	4,410
Total	​	$	2,066,574	​	$	1,266,464	​	$	—	​	$	3,333,038
​	​	​	​	​	​	​	​	​	​	​	​	​
Amounts included in:	​	​	​	​	​	​	​	​	​	​	​	​
Cash and cash equivalents	​	$	2,066,574	​	$	231,101	​	$	—	​	$	2,297,675
Short-term investments	​		—	​		955,605	​		—	​		955,605
Accounts receivable, net	​		—	​		4,618	​		—	​		4,618
Other assets	​	​	—	​	​	316	​	​	—	​	​	316
Investments	​		—	​		76,431	​		—	​		76,431
Accrued liabilities	​		—	​		(1,607)	​		—	​		(1,607)
Total	​	$	2,066,574	​	$	1,266,464	​	$	—	​	$	3,333,038

​

All of the Company’s short-term and long-term investments are classified within Level 1 or Level 2 of the fair value hierarchy. The Company’s valuation of its Level 1 investments is based on quoted market prices in active markets for identical securities. The Company’s valuation of its Level 2 investments is based on other observable inputs, specifically a market approach which utilizes valuation models, pricing systems, mathematical tools and other relevant information for the same or similar securities. The Company’s valuation of its Level 2 foreign currency exchange contracts is based on quoted market prices of the same or similar instruments, adjusted

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

for counterparty risk. There were no transfers between Level 1 and Level 2 measurements during the three-months ended March 31, 2024, or during the year-ended December 31, 2023, and there were no changes in the Company’s valuation techniques.

​

6.	DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

The Company accounts for its derivative instruments and hedging activities under ASC 815, “Derivatives and Hedging.” The following table presents the fair values of the Company’s derivative instruments:

​

​	​	​	​	​	​	​	​	​
​		Fair value
​	​	March 31,			December 31,			​
Derivatives designated as hedging instruments	​	2024		​	2023		​	Balance Sheet location
Assets:		​			​		​
Commodity contracts	​	$	2,379	​	$	4,480	​	Accounts receivable, net
Commodity contracts	​	$	332	​	$	316	​	Other assets
Liabilities:	​		​	​			​
Commodity contracts	​	$	(432)	​	$	(386)	​	Accrued liabilities

​

​	​	​	​	​	​	​	​	​
​		Fair value
​	​	March 31,			December 31,			​
Derivatives not designated as hedging instruments	​	2024		​	2023		​	Balance Sheet location
Assets:		​			​		​
Foreign currency exchange contracts	​	$	602	​	$	138	​	Accounts receivable, net
Liabilities:	​			​			​
Foreign currency exchange contracts	​	$	(1,193)	​	$	(1,221)	​	Accrued liabilities

​

Cash Flow Hedging Strategy

The Company uses cash flow hedges to minimize the variability in cash flows of forecasted transactions caused by fluctuations in commodity prices. The changes in the fair values of derivatives designated as cash flow hedges are recorded in accumulated other comprehensive income (loss) (“AOCI”) and are reclassified into the line item in our condensed consolidated statement of income in which the hedged items are recorded in the same period that the hedged items affect earnings. The changes in the fair values of hedges that are determined to be ineffective are immediately reclassified from AOCI into earnings. The maximum length of time for which the Company hedges its exposure to the variability in future cash flows is currently less than two years.

The Company has entered into commodity hedge contracts to mitigate the price risk associated with a portion of its forecasted aluminum purchases. These derivative instruments were designated as part of the Company’s commodity cash flow hedging program. The objective of this hedging program is to reduce the variability of cash flows associated with future purchases of aluminum. The total notional values of derivatives that were designated and qualified for this program were $126.1 million and $98.3 million as of March 31, 2024 and December 31, 2023, respectively. Transactions under the commodity cash flow hedging program were executed beginning in May 2023.

The following table presents the impact that changes in the fair values of derivatives designated as cash flow hedges had on other comprehensive income (“OCI”), AOCI and earnings:

​

​	​	​	​	​	​	​	​	​
Three-months ended March 31, 2024
Derivatives		​	​		​		Gain (loss)
designated as	​	Gain (loss) recognized		​	Location of gain (loss)	​	reclassified from
hedging instruments	​	in AOCI		​	recognized in income	​	AOCI into income
Commodity contracts	​	$	2,279		Cost of sales	​	$	(966)

​

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

As of March 31, 2024, the Company estimates that it will reclassify into earnings net gains (losses) of $1.9 million from the amount recorded in AOCI as the anticipated cash flows occur during the next 12 months.

Economic (Non-Designated) Hedging Strategy

The Company is exposed to foreign currency exchange rate risks related primarily to its foreign business operations. During the three-months ended March 31, 2024 and 2023, the Company entered into forward currency exchange contracts with financial institutions to create an economic hedge to specifically manage a portion of the foreign exchange risk exposure associated with certain consolidated subsidiaries’ non-functional currency denominated assets and liabilities. All foreign currency exchange contracts of the Company that were outstanding as of March 31, 2024 have terms of approximately one month or less. The Company does not enter into forward currency exchange contracts for speculation or trading purposes.

The Company has not designated its foreign currency exchange contracts as hedge transactions. Therefore, gains and losses on the Company’s foreign currency exchange contracts are recognized in interest and other income (expense), net, in the condensed consolidated statements of income, and are largely offset by the changes in the fair value of the underlying economically hedged item. The total notional values of derivatives related to our foreign currency economic hedges were $230.5 million and $282.7 million as of March 31, 2024 and December 31, 2023, respectively.

The net gains (losses) on derivatives not designated as hedging instruments in the condensed consolidated statements of income were as follows:

​

​	​	​	​	​	​	​	​	​
​	​	​	​	Gain (loss)
​	​	​	​	recognized in income on
​	​	​	​	derivatives
​	​	​	​	Three-months ended
Derivatives not designated as	​	Location of gain (loss)	​	March 31,		​	March 31,
hedging instruments		recognized in income on derivatives		2024			2023
Foreign currency exchange contracts		Interest and other income, net	​	$	5,343	​	$	(7,852)

​

Certain of the Company’s counterparty agreements contain provisions that require the Company to post collateral on derivative instruments in a net liability position. As of March 31, 2024, $0.6 million was posted as collateral.

​

​

7.	INVENTORIES

Inventories consist of the following at:

​

​	​	​	​	​	​	​
​		March 31,			December 31,
​		2024			2023
Raw materials	​	$	285,966	​	$	330,021
Work in process	​	​	1,601	​	​	1,403
Finished goods	​		652,063	​		639,982
​	​	$	939,630	​	$	971,406

​

​

​

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

8.	PROPERTY AND EQUIPMENT, NET

Property and equipment consist of the following at:

​

​	​	​	​	​	​	​
​		March 31,			December 31,
​		2024			2023
Land	​	$	153,340	​	$	152,253
Leasehold improvements	​		38,159	​		37,946
Furniture and fixtures	​		11,401	​		11,422
Office and computer equipment	​		26,421	​		25,560
Computer software	​		5,053	​		5,344
Equipment	​		449,321	​		426,466
Buildings	​		212,359	​		211,951
Vehicles	​		69,937	​		69,527
Assets under construction	​	​	234,627	​	​	211,562
​	​		1,200,618	​		1,152,031
Less: accumulated depreciation and amortization	​		(277,328)	​		(261,235)
​	​	$	923,290	​	$	890,796

​

Total depreciation and amortization expense was $19.2 million and $14.8 million for the three-months ended March 31, 2024 and 2023, respectively.

​

9.GOODWILL AND OTHER INTANGIBLE ASSETS

The following is a roll-forward of goodwill for the three-months ended March 31, 2024 and 2023 by reportable segment:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Monster		​	​	​	​	​	​	​	​	​	​	​	​
​	​	Energy®		​	Strategic		​	Alcohol		​	​	​	​	​	​
​		Drinks			Brands			Brands			Other			Total
Balance at December 31, 2023	​	$	693,644	​	$	637,999	​	$	86,298	​	$	—	​	$	1,417,941
Acquisitions	​		—	​		—	​		—	​		—	​		—
Balance at March 31, 2024	​	$	693,644	​	$	637,999	​	$	86,298	​	$	—	​	$	1,417,941

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Monster		​	​	​	​	​	​	​	​	​	​	​	​
​	​	Energy®		​	Strategic		​	Alcohol		​	​	​	​	​	​
​		Drinks			Brands			Brands			Other			Total
Balance at December 31, 2022	​	$	693,644	​	$	637,999	​	$	86,298	​	$	—	​	$	1,417,941
Acquisitions	​		—	​		—	​		—	​		—	​		—
Balance at March 31, 2023	​	$	693,644	​	$	637,999	​	$	86,298	​	$	—	​	$	1,417,941

​

Intangible assets consist of the following at:

​

​	​	​	​	​	​	​
​		March 31,			December 31,
​		2024			2023
Amortizing intangibles	​	$	144,378	​	$	144,582
Accumulated amortization	​		(75,982)	​		(74,699)
​	​		68,396	​		69,883
Non-amortizing intangibles	​		1,362,366	​		1,357,256
​	​	$	1,430,762	​	$	1,427,139

​

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

Amortizing intangibles primarily consist of customer relationships. All amortizing intangibles have been assigned an estimated finite useful life and such intangibles are amortized on a straight-line basis over the number of years that approximate their respective useful lives, generally ten to fifteen years. Total amortization expense was $1.3 million and $2.0 million for the three-months ended March 31, 2024 and 2023, respectively.

The following is the future estimated amortization expense related to amortizing intangibles as of March 31, 2024:

​

​	​	​	​
2024 (from April 1, 2024 to December 31, 2024)		$	4,461
2025	​	​	5,947
2026	​	​	5,947
2027	​	​	5,946
2028	​	​	5,945
2029 and thereafter	​	​	40,150
​	​	$	68,396

​

​

​

10.	DISTRIBUTION AGREEMENTS

In the normal course of business, amounts received pursuant to new and/or amended distribution agreements entered into with certain bottlers/distributors, relating to the costs associated with terminating agreements with the Company’s prior distributors, or at the inception of certain sales/marketing programs are accounted for as deferred revenue and are recognized as revenue ratably over the anticipated life of the respective agreement, generally 20 years or program duration, as the case may be. Revenue recognized was $9.9 million for both the three-months ended March 31, 2024 and 2023.

​

11.	COMMITMENTS AND CONTINGENCIES

The Company had purchase commitments aggregating approximately $345.5 million at March 31, 2024, which represented commitments made by the Company and its subsidiaries to various suppliers of raw materials for the production of its products. These obligations vary in terms but are generally satisfied within one year.

The Company had contractual obligations aggregating approximately $451.1 million at March 31, 2024, which related primarily to sponsorships and other marketing activities.

The Company has a credit facility with HSBC Bank (China) Company Limited, Shanghai Branch, of $15.0 million. At March 31, 2024, the interest rate on borrowings under the line of credit was 5.5%. As of March 31, 2024, no amount was outstanding on this line of credit.

Litigation — From time to time in the normal course of business, the Company is named in litigation, including labor and employment matters, personal injury matters, consumer class actions, intellectual property matters and claims from prior distributors. Although it is not possible to predict the ultimate outcome of such litigation, based on the facts known to the Company, management believes that such litigation in aggregate will likely not have a material adverse effect on the Company’s financial position or results of operations.

The Company evaluates, on a quarterly basis, developments in legal proceedings and other matters that could cause an increase or decrease in the amount of the liability that is accrued, if any, and any related insurance reimbursements. As of March 31, 2024 and December 31, 2023, $0.3 million of loss contingencies were included in the Company’s accompanying condensed consolidated balance sheet.

​

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

12.	ACCUMULATED OTHER COMPREHENSIVE LOSS

Changes in accumulated other comprehensive loss by component, after tax, for the three-months ended March 31, 2024 and 2023 are as follows:

​

​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Accumulated		​	​	​	​	​		​	​	​
​	​	Net Gains			​			Unrealized			​	​
​	​	(Losses)		​	Currency		​	Gains (Losses)		​	​	​
​	​	on Commodity		​	Translation		​	on Available-for-		​	​	​
​		Derivatives			Gains (Losses)			Sale Securities			Total
Balance at December 31, 2023	​	$	4,410	​	$	(128,989)	​	$	(758)	​	$	(125,337)
Other comprehensive income (loss) before reclassifications	​	​	(2,131)	​		(30,695)	​	​	223	​	​	(32,603)
Net current-period other comprehensive income (loss)	​	​	(2,131)	​		(30,695)	​	​	223	​	​	(32,603)
Balance at March 31, 2024	​	$	2,279	​	$	(159,684)	​	$	(535)	​	$	(157,940)

​

​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Accumulated		​	​	​	​	​		​	​	​
​	​	Net Gains			​		​	Unrealized		​	​	​
​	​	(Losses)		​	Currency		​	Gains (Losses)		​	​	​
​	​	on Commodity			Translation			on Available-for-			​	​
​		Derivatives			Gains (Losses)			Sale Securities			Total
Balance at December 31, 2022	​	$	—	​	$	(153,230)	​	$	(5,843)	​	$	(159,073)
Other comprehensive income (loss) before reclassifications	​	​	—	​		7,981	​	​	3,181	​	​	11,162
Net current-period other comprehensive income (loss)	​	​	—	​		7,981	​	​	3,181	​	​	11,162
Balance at March 31, 2023	​	$	—	​	$	(145,249)	​	$	(2,662)	​	$	(147,911)

​

​

13.	TREASURY STOCK

On November 2, 2022, the Company’s Board of Directors authorized a share repurchase program for the purchase of up to an additional $500.0 million of the Company’s outstanding common stock (the “November 2022 Repurchase Plan”). During the three-months ended March 31, 2024, the Company purchased approximately 1.8 million shares of common stock at an average purchase price of $54.96 per share, for a total amount of approximately $97.2 million (excluding broker commissions), under the November 2022 Repurchase Plan. As of May 7, 2024, $142.4 million remained available for repurchase under the November 2022 Repurchase Plan.

On November 7, 2023, the Company’s Board of Directors authorized a share repurchase program for the purchase of up to an additional $500.0 million of the Company’s outstanding common stock (the “November 2023 Repurchase Plan”). During the three-months ended March 31, 2024, no shares were repurchased under the November 2023 Repurchase Plan. As of May 7, 2024, $500.0 million remained available for repurchase under the November 2023 Repurchase Plan.

The aggregate amount of the Company’s outstanding common stock that remains available for repurchase under all previously authorized repurchase plans is $642.4 million as of May 7, 2024.

During the three-months ended March 31, 2024, 0.4 million shares of common stock were purchased from employees in lieu of cash payments for options exercised or withholding taxes due for a total amount of $23.0 million. While such purchases are considered common stock repurchases, they are not counted as purchases against the Company’s authorized share repurchase programs. Such shares are included in common stock in treasury in the accompanying consolidated balance sheet at March 31, 2024.

​

14.	STOCK-BASED COMPENSATION

The Company has two stock-based compensation plans under which shares were available for grant at March 31, 2024: (i) the Monster Beverage Corporation 2020 Omnibus Incentive Plan, including the Monster Beverage Corporation Deferred Compensation Plan as a sub-plan thereunder, and (ii) the Monster Beverage Corporation 2017 Compensation Plan for Non-Employee Directors as

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

Amended and Restated on February 23, 2022, including the Monster Beverage Corporation Deferred Compensation Plan for Non-Employee Directors as a sub-plan thereunder.

The Company recorded $22.5 million and $16.1 million of compensation expense relating to outstanding options, restricted stock units, performance share units and other share-based awards during the three-months ended March 31, 2024 and 2023, respectively.

The tax benefit for tax deductions from non-qualified stock option exercises, disqualifying dispositions of incentive stock options and vesting of restricted stock units and performance share units for the three-months ended March 31, 2024 and 2023 was $7.5 million and $25.9 million, respectively.

Stock Options

Under the Company’s stock-based compensation plans, all stock options granted as of March 31, 2024 were granted at prices based on the fair value of the Company’s common stock on the date of grant. The Company records compensation expense for stock options based on the estimated fair value of the options on the date of grant using the Black-Scholes-Merton option pricing formula with the assumptions included in the table below. The Company uses historical data to determine the exercise behavior, volatility and forfeiture rate of the options.

The following weighted-average assumptions were used to estimate the fair value of options granted during:

​

​	​	​	​	​	​
​	​	Three-Months Ended March 31,			​
​		2024		2023	​
Dividend yield	​	0.0	%	0.0	%
Expected volatility	​	27.5	%	27.6	%
Risk-free interest rate	​	4.3	%	3.7	%
Expected term	​	6.4	years	6.3	years

​

Expected Volatility: The Company uses historical volatility as it provides a reasonable estimate of the expected volatility. Historical volatility is based on the most recent volatility of the stock price over a period of time equivalent to the expected term of the option.

Risk-Free Interest Rate: The risk-free interest rate is based on the U.S. treasury zero-coupon yield curve in effect at the time of grant for the expected term of the option.

Expected Term: The Company’s expected term represents the weighted-average period that the Company’s stock options are expected to be outstanding. The expected term is based on the expected time to post-vesting exercise of options by employees. The Company uses historical exercise patterns of previously granted options to derive employee behavioral patterns used to forecast expected exercise patterns.

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

The following table summarizes the Company’s activities with respect to its stock option plans as follows:

​

​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	Weighted-	​	​	​
​	​	​	​	Weighted-		​	Average	​	​	​
​	​	​	​	Average		​	Remaining	​	​	​
​	​	Number of	​	Exercise		​	Contractual	​	​	​
​	​	Shares (in	​	Price Per		​	Term (in	​	Aggregate
Options		thousands)		Share			years)		Intrinsic Value
Outstanding at January 1, 2024		24,983	​	$	33.64		5.8	​	$	598,866
Granted 01/01/24 - 03/31/24		4,332	​	$	60.29	​	​	​	​	​
Exercised		(1,457)	​	$	26.35	​	​	​	​	​
Cancelled or forfeited		(14)	​	$	40.13	​	​	​	​	​
Outstanding at March 31, 2024		27,844	​	$	38.17		6.3	​	$	592,303
Vested and expected to vest in the future at March 31, 2024	​	26,628	​	$	37.55	​	6.2	​	$	582,560
Exercisable at March 31, 2024	​	15,538	​	$	29.22	​	4.3	​	$	467,020

​

The weighted-average grant-date fair value of options granted during the three-months ended March 31, 2024 and 2023 was $22.69 per share and $18.23 per share, respectively.

The total intrinsic value of options exercised during the three-months ended March 31, 2024 and 2023 was $47.6 million and $131.0 million, respectively.

Cash received from option exercises under all plans for the three-months ended March 31, 2024 and 2023 was $38.4 million and $36.3 million, respectively.

At March 31, 2024, there was $174.7 million of total unrecognized compensation expense related to non-vested options granted to employees under the Company’s stock-based compensation plans. That cost is expected to be recognized over a weighted-average period of 3.6 years.

Restricted Stock Units and Performance Share Units

The cost of stock-based compensation for restricted stock units and performance share units is measured based on the closing fair market value of the Company’s common stock at the date of grant. In the event that the Company has the option and intent to settle a restricted stock unit or performance share unit in cash, the award is classified as a liability and revalued at each balance sheet date.

The following table summarizes the Company’s activities with respect to non-vested restricted stock units and performance share units as follows:

​

​	​	​	​	​	​
​	​	​	​	Weighted
​	​	Number of	​	Average
​	​	Shares (in	​	Grant-Date
​		thousands)		Fair Value
Non-vested at January 1, 2024	​	1,964	​	$	40.95
Granted 01/01/24 - 03/31/241	​	502	​	$	57.04
Vested	​	(821)	​	$	40.63
Forfeited/cancelled	​	(1)	​	$	30.36
Non-vested at March 31, 2024	​	1,644	​	$	46.03

​

1_The grant activity for performance share units is recorded based on the target performance level earning_ 100% of target performance share units. The actual number of performance share units earned could range from 0% to 200% of target depending on the achievement of pre-established performance goals.

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

The weighted-average grant-date fair value of restricted stock units and/or performance share units granted during the three-months ended March 31, 2024 and 2023 was $60.27 and $50.83 per share, respectively.

As of March 31, 2024, 1.6 million of restricted stock units and performance share units are expected to vest over their respective terms.

At March 31, 2024, total unrecognized compensation expense relating to non-vested restricted stock units and performance share units was $49.6 million, which is expected to be recognized over a weighted-average period of 1.8 years.

Other Share-Based Awards

The Company has granted other share-based awards to certain employees that are payable in cash. These awards are classified as liabilities and are valued based on the fair value of the award at the grant date and are remeasured at each reporting date until settlement, with compensation expense being recognized in proportion to the completed requisite service period up until date of settlement. At March 31, 2024, other share-based awards outstanding included grants that vest over three years payable in the first quarters of 2025, 2026 and 2027.

At March 31, 2024, there was $0.8 million of total unrecognized compensation expense related to nonvested other share-based awards granted to employees under the Company’s stock-based compensation plans. That cost is expected to be recognized over a weighted-average period of 1.3 years.

15.	INCOME TAXES

The following is a roll-forward of the Company’s total gross unrecognized tax benefits, not including interest and penalties, for the three-months ended March 31, 2024:

​

​	​	​	​
​	​	Gross Unrecognized
​		Tax Benefits
Balance at December 31, 2023	​	$	3,109
Additions for tax positions related to the current year	​		2,900
Additions for tax positions related to the prior years	​		—
Decreases for tax positions related to the prior years	​		—
Balance at March 31, 2024	​	$	6,009

​

The Company recognizes accrued interest and penalties related to unrecognized tax benefits in the provision for income taxes in the Company’s condensed consolidated financial statements. As of March 31, 2024, the Company had approximately $0.7 million in accrued interest and penalties related to unrecognized tax benefits. If the Company were to prevail on all uncertain tax positions, the resultant impact on the Company’s effective tax rate would not be significant. It is expected that any change in the amount of unrecognized tax benefits within the next 12 months will not be significant.

The Company is subject to U.S. federal income tax as well as to income tax in multiple state and foreign jurisdictions.

The Company is in various stages of examination with certain states and certain foreign jurisdictions. The Company’s 2020 through 2023 U.S. federal income tax returns are subject to examination by the IRS. The Company’s state income tax returns are subject to examination for the 2019 through 2023 tax years. The United Kingdom and Ireland income tax returns are subject to examination for the 2019 through 2023 tax years.

​

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

16.	EARNINGS PER SHARE

A reconciliation of the weighted-average shares used in the basic and diluted earnings per common share computations is presented below (in thousands):

​

​	​	​	​	​
​	​	Three-Months Ended
​	​	March 31,
​		2024		2023
Weighted-average shares outstanding:	​	​	​	​
Basic	​	1,041,081		1,044,909
Dilutive	​	10,201		14,160
Diluted	​	1,051,282		1,059,069

​

For the three-months ended March 31, 2024 and 2023, options and awards outstanding totaling 5.0 million shares and 2.6 million shares, respectively, were excluded from the calculations as their effect would have been antidilutive.

​

17.	SEGMENT INFORMATION

The Company has four operating and reportable segments: (i) Monster Energy® Drinks segment, which is primarily comprised of the Company’s Monster Energy® drinks, Reign Total Body Fuel® high performance energy drinks, Reign Storm® total wellness energy drinks, Bang Energy® drinks and Monster Tour Water®, (ii) Strategic Brands segment, which is primarily comprised of the various energy drink brands acquired from TCCC in 2015 as well as the Company’s affordable energy brands, Predator® and Fury®, (iii) Alcohol Brands segment, which is comprised of various craft beers, hard seltzers and FMBs and (iv) Other segment, which is comprised of the AFF Third-Party Products.

The Company’s Monster Energy® Drinks segment primarily generates net operating revenues by selling ready-to-drink packaged drinks primarily to bottlers/distributors. In some cases, the Company sells ready-to-drink packaged drinks directly to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience and gas chains, drug stores, foodservice customers, value stores, e-commerce retailers and the military.

The Company’s Strategic Brands segment primarily generates net operating revenues by selling “concentrates” and/or “beverage bases” to authorized bottling and canning operations. Such bottlers generally combine the concentrates and/or beverage bases with sweeteners, water and other ingredients to produce ready-to-drink packaged energy drinks. The ready-to-drink packaged energy drinks are then sold by such bottlers to other bottlers/distributors and to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience and gas chains, foodservice customers, drug stores, value stores, e-commerce retailers and the military. To a lesser extent, the Strategic Brands segment generates net operating revenues by selling certain ready-to-drink packaged energy drinks to bottlers/distributors.

Generally, the Monster Energy® Drinks segment generates higher per case net operating revenues, but lower per case gross profit margin percentages than the Strategic Brands segment.

The Company’s Alcohol Brands segment primarily generates operating revenues by selling kegged and ready-to-drink canned beers, hard seltzers and FMBs primarily to beer distributors in the United States.

Generally, the Alcohol Brands segment has lower gross profit margin percentages than the Monster Energy® Drinks segment.

Corporate and unallocated amounts that do not relate to a reportable segment have been allocated to “Corporate & Unallocated.” No asset information, other than goodwill and other intangible assets, has been provided in the Company’s reportable segments, as management does not measure or allocate such assets on a segment basis.

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

The net revenues derived from the Company’s reportable segments and other financial information related thereto for the three-months ended March 31, 2024 and 2023 were as follows:

​

​	​	​	​	​	​	​
​	​	Three-Months Ended
​	​	March 31,
​		2024			2023
Net sales:	​	​	​	​	​	​
Monster Energy® Drinks1	​	$	1,729,051	​	$	1,561,669
Strategic Brands	​		108,444	​		86,357
Alcohol Brands	​	​	56,070	​	​	46,290
Other	​		5,533	​		4,614
Corporate and unallocated	​		—	​		—
​	​	$	1,899,098	​	$	1,698,930

​

​	​	​	​	​	​	​
​	​	Three-Months Ended
​	​	March 31,
​		2024			2023
Operating Income:	​	​	​	​	​	​
Monster Energy® Drinks1	​	$	628,122	​	$	560,819
Strategic Brands	​		62,019	​		51,771
Alcohol Brands	​	​	(6,017)	​	​	(6,883)
Other	​		1,001	​		(293)
Corporate and unallocated	​		(143,134)	​		(120,350)
​	​	$	541,991	​	$	485,064

​

​	​	​	​	​	​	​
​	​	Three-Months Ended
​	​	March 31,
​		2024			2023
Income before tax:	​	​	​	​	​	​
Monster Energy® Drinks1	​	$	629,160	​	$	561,674
Strategic Brands	​		62,035	​		51,788
Alcohol Brands	​	​	(6,016)	​	​	(6,867)
Other	​		1,016	​		(293)
Corporate and unallocated	​		(108,450)	​		(108,742)
​	​	$	577,745	​	$	497,560

​

	(1)	Includes $9.9 million for both the three-months ended March 31, 2024 and 2023, related to the recognition of deferred revenue.

​

​	​	​	​	​	​	​
​	​	Three-Months Ended
​	​	March 31,
​		2024			2023
Depreciation and amortization:	​	​	​	​	​	​
Monster Energy® Drinks	​	$	12,608	​	$	8,989
Strategic Brands	​		229	​		221
Alcohol Brands	​	​	3,738	​	​	4,051
Other	​		40	​		1,123
Corporate and unallocated	​		3,860	​		2,424
​	​	$	20,475	​	$	16,808

​

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

Corporate and unallocated expenses for the three-months ended March 31, 2024 include $98.6 million of payroll costs, of which $22.0 million was attributable to stock-based compensation expenses (see Note 14 “Stock-Based Compensation”), as well as $20.0 million attributable to professional service expenses, including accounting and legal costs, and $24.5 million of other operating expenses.

Corporate and unallocated expenses for the three-months ended March 31, 2023 include $80.3 million of payroll costs, of which $15.7 million was attributable to stock-based compensation expenses (see Note 14 “Stock-Based Compensation”), as well as $22.1 million attributable to professional service expenses, including accounting and legal costs, and $18.0 million of other operating expenses.

Coca-Cola Europacific Partners accounted for approximately 14% and 13% of the Company’s net sales for the three-months ended March 31, 2024 and 2023, respectively.

Coca-Cola Consolidated, Inc. accounted for approximately 10% of the Company’s net sales for both the three-months ended March 31, 2024 and 2023.

Reyes Holdings, LLC accounted for approximately 9% of the Company’s net sales for both the three-months ended March 31, 2024 and 2023.

Net sales to customers outside the United States amounted to $744.1 million and $622.9 million for the three-months ended March 31, 2024 and 2023, respectively. Such sales were approximately 39% and 37% of net sales for the three-months ended March 31, 2024 and 2023, respectively.

Goodwill and other intangible assets for the Company’s reportable segments were as follows at:

​

​	​	​	​	​	​	​
​		March 31,			December 31,
​		2024			2023
Goodwill and other intangible assets:	​	​	​	​	​	​
Monster Energy® Drinks	​	$	1,668,188	​	$	1,663,814
Strategic Brands	​		982,676	​		982,471
Alcohol Brands	​	​	197,839	​	​	198,795
Other	​		—	​		—
​	​	$	2,848,703	​	$	2,845,080

​

​

18.	RELATED PARTY TRANSACTIONS

TCCC controls approximately 19.6% of the voting interests of the Company. The TCCC Subsidiaries, the TCCC Related Parties and certain TCCC independent bottlers, purchase and distribute the Company’s products in domestic and certain international markets. The Company also pays TCCC a commission based on certain sales within the TCCC distribution network.

TCCC commissions, based on sales to the TCCC Subsidiaries and the TCCC Related Parties, were $22.5 million and $15.7 million for the three-months ended March 31, 2024 and 2023, respectively, and are included as a reduction to net sales.

TCCC commissions, based on sales to TCCC independent bottlers, were $9.7 million and $8.8 million for the three-months ended March 31, 2024 and 2023, respectively, and are included in operating expenses.

Net sales to the TCCC Subsidiaries for the three-months ended March 31, 2024 and 2023 were $41.7 million and $35.1 million, respectively.

The Company also purchases concentrates from TCCC which are then sold to certain of the Company’s bottlers/distributors. Concentrate purchases from TCCC were $8.0 million and $6.5 million for the three-months ended March 31, 2024 and 2023, respectively.

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular Dollars in Thousands, Except Per Share Amounts) (Unaudited)

​

Certain TCCC Subsidiaries also contract manufacture certain of the Company’s energy drinks. Such contract manufacturing expenses were $9.0 million and $7.4 million for the three-months ended March 31, 2024 and 2023, respectively.

Accounts receivable, accounts payable, accrued promotional allowances and accrued liabilities related to the TCCC Subsidiaries were as follows at:

​

​	​	​	​	​	​	​
​	​	March 31,		​	December 31,
​		2024			2023
Accounts receivable, net	​	$	139,825	​	$	135,246
Accounts payable	​	$	(35,923)	​	$	(68,386)
Accrued promotional allowances	​	$	(15,260)	​	$	(13,794)
Accrued liabilities	​	$	(25,325)	​	$	(19,745)

​

One director of the Company through certain trusts, and a family member of one director are the principal owners of a company that provides promotional materials to the Company. Expenses incurred with such company in connection with promotional materials purchased during the three-months ended March 31, 2024 and 2023 were $1.9 million and $1.1 million, respectively.

The Company occasionally charters a private aircraft that is indirectly owned by Mr. Rodney C. Sacks, Co-Chief Executive Officer and Chairman of the Board of Directors. On certain occasions, Mr. Sacks is accompanied by guests and other Company personnel when using such aircraft for business travel. During the three-months ended March 31, 2024 and 2023, the Company incurred no costs in relation to the aircraft.

In December 2018, the Company and a director of the Company entered into a 50-50 partnership that purchased land, and real property thereon, in Kona, Hawaii for the purpose of producing coffee products. In October 2023, the partnership made a special, one-time distribution to each of the partners, reflecting the amount of their initial capital contributions. This partnership meets the definition of a Variable Interest Entity (“VIE”) for which the Company has determined that it is the primary beneficiary. Therefore, the Company consolidates the VIE in the accompanying consolidated financial statements. The aggregate carrying values of the VIE’s assets and liabilities, after elimination of any intercompany transactions and balances, as well as the results of operations for all periods presented, are not material to the Company’s consolidated financial statements.

​

19.	SUBSEQUENT EVENTS

On May 1, 2024, the Board of Directors authorized the Company to commence a modified “Dutch auction” tender offer to repurchase up to $3.0 billion of its outstanding shares of common stock. The Company anticipates commencing the tender offer in May 2024. Details of the tender offer, including the offer price, conditions, potential participation by management and other terms, will be set forth in the offering materials to be distributed to shareholders upon commencement of the tender offer.

The Company expects to fund the tender offer with approximately $2.0 billion of cash on hand and approximately $1.0 billion in combined borrowings, consisting of a new revolving credit facility and a new delayed draw term loan facility, each expected to be consummated prior to the completion of the tender offer. The tender offer will be made outside of the Company’s previously authorized repurchase programs and will allow the Company to retain the ability to purchase additional shares through the previously authorized repurchase programs in the future.

​

​