OTC:JSDA
JONES SODA CO.
A regional beverage manufacturer facing significant profitability headwinds despite recent revenue stabilization.
Key Metrics
Investment Thesis
Bull Case
Bullish investors may view the current stock price as reflecting extreme pessimism about a turnaround that could occur once cost structures are optimized; the stabilization of revenue at near-2022 levels suggests the top line has reached a floor, potentially allowing for future margin expansion as fixed costs are spread over consistent sales volumes.
Bear Case
Bearish investors should avoid this stock due to the widening net loss and lack of positive operating cash flow which signals fundamental business model deterioration; the massive retained earnings deficit indicates that the company has consumed nearly a decade of profits without generating value, raising concerns about long-term viability and capital adequacy.
About JONES SODA CO.
JONES SODA CO. (JSDA) operates in the non-alcoholic beverage sector, manufacturing and distributing a diverse portfolio of carbonated soft drinks, bottled waters, and ready-to-drink teas to retailers and foodservice channels across North America.
Analysis
Management Discussion
While revenue recovered to $19.2 million in 2024 from a low point in 2023, the company continues to burn cash with operating cash flow of -$5.9 million and a net loss widening to -$9.9 million; significant increases in inventory by $2.4 million and accounts payable by $2.7 million suggest management is managing working capital aggressively but has not yet stabilized core margins.
Industry Overview
The North American non-alcoholic beverage industry is highly fragmented but consolidating around major players with strong economies of scale; success in this sector now depends heavily on innovation in functional ingredients and sustainability rather than just volume growth.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Revenue | $19.1M | $16.7M | $19.2M |
| Cost of Revenue | $13.9M | $11.8M | $15.1M |
| Gross Profit | $5.1M | $4.9M | $4.1M |
| Operating Expenses | $11.2M | $9.7M | $14.0M |
| Operating Income | $-6.1M | $-4.9M | $-9.9M |
| G&A | $6.3M | $5.4M | $7.9M |
| Marketing | $5.0M | $4.4M | $6.1M |
| Stock-Based Comp | $1.4M | $694.0K | $1.1M |
| D&A | $414.0K | $63.0K | $56.0K |
| Depreciation | $66.0K | $63.0K | $56.0K |
| Other OpEx | $0 | $0 | $0 |
| Non-Operating Income | $-283.0K | $57.0K | $28.0K |
| Interest Expense | $377.0K | $0 | — |
| Pre-Tax Income | $-6.4M | $-4.8M | $-9.9M |
| Income Tax | $28.0K | $33.0K | $25.0K |
| Continuing Ops | $-6.4M | $-4.9M | $-9.9M |
| Discontinued Ops | $0 | $0 | $0 |
| Net Income | $-6.4M | $-4.9M | $-9.9M |
| Minority Interest | $0 | $0 | $0 |
| Net to Common | $-6.4M | $-4.9M | $-9.9M |
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Current Assets | $15.0M | $9.6M | $8.4M |
| Cash & Equivalents | $8.0M | $3.9M | $1.5M |
| Accounts Receivable | $3.2M | $2.1M | $2.2M |
| Inventory | $2.6M | $2.4M | $3.5M |
| Prepaid Expenses | $601.0K | $861.0K | $948.0K |
| Other Current Assets | $612.0K | $357.0K | $199.0K |
| Long-Term Assets | $127.0K | $311.0K | $143.0K |
| PP&E (Net) | $127.0K | $137.0K | $108.0K |
| Operating Leases | $0 | — | — |
| Other LT Assets | $0 | $174.0K | $35.0K |
| Total Assets | $15.1M | $9.9M | $8.5M |
| Current Liabilities | $3.3M | $2.4M | $6.4M |
| Accounts Payable | $1.1M | $716.0K | $3.4M |
| Current Leases | $0 | — | — |
| Other Current Liab | $622.0K | $357.0K | $490.0K |
| Long-Term Liabilities | $0 | $0 | $0 |
| LT Operating Leases | $0 | — | — |
| Other LT Liab | $0 | — | — |
| Total Liabilities | $3.3M | $2.4M | $6.4M |
| Shareholders' Equity | $11.8M | $7.5M | $2.2M |
| Retained Earnings | $-78.2M | $-83.1M | $-92.9M |
| AOCI | $287.0K | $331.0K | $222.0K |
| Total L&E | $15.1M | $9.9M | $8.5M |
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Net Income (CFO) | $-6.4M | $-4.9M | $-9.9M |
| Non-Cash Adjustments | $-1.2M | $2.3M | $-2.3M |
| Working Capital Changes | $1.7M | $-1.3M | $6.3M |
| Cash from Operations | $-6.0M | $-3.8M | $-5.9M |
| Capital Expenditures | $29.0K | $73.0K | $27.0K |
| Cash from Investing | $100.0K | $-73.0K | $-27.0K |
| Cash from Financing | $9.2M | $-246.0K | $3.7M |
| FX Effect | $-53.0K | $34.0K | $-77.0K |
| Net Change in Cash | $3.4M | $-4.1M | $-2.3M |
| Beginning Cash | $4.7M | $8.0M | $3.9M |
| Ending Cash | $8.0M | $3.9M | $1.5M |
Frequently Asked Questions
How does JONES SODA CO. make money?
Core revenue is derived from the sale of branded soda products, supplemented by sales of water and specialty tea lines; operations include manufacturing facilities and a distribution network serving independent retailers and large-format grocery chains.
What are the main risks for JSDA?
Persistent net losses of nearly $10 million indicate severe structural profitability issues; high operating expenses relative to revenue suggest inefficient cost management or pricing power constraints; the company carries a substantial retained earnings deficit of over $92 million which could trigger covenant violations if financing conditions tighten; reliance on a volatile OTC market increases liquidity and valuation risk for investors.
What is JSDA's competitive advantage?
The company leverages a legacy brand portfolio with strong regional recognition in specific territories, maintains flexibility in its production scheduling to manage raw material costs, and utilizes a direct distributor model that allows for tailored shelf-space negotiations.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.