SodaCreamed: SODA Bubble Fizzles After Abysmal Guidance; Stock Halted

Tyler Durden's picture

In the new normal, companies can one second trade with a market cap of hundreds of millions (or over a billion in the case of negative cash flow GTAT) and the next unexpectedly report they are bankrupt, or, as SODA just did, give guidance that is just about as bad. From the just release press release which explains why the news was so bad, SODA stock actually had to be halted:

  • Revenue to be approximately $125.0 million; expected: $154.4 million
  • Operating income to be approximately $8.5 million; expected: $17.6 million

Translated: the SodaStream fad is officially over. From the release:

"We are very disappointed in our recent performance," said Daniel Birnbaum, Chief Executive Officer of SodaStream. "Our U.S. business underperformed due to lower than expected demand for our soda makers and flavors which was the primary driver of the overall shortfall in the third quarter. While we were successful over the last few years in establishing a solid base of repeat users in the U.S., we have not succeeded in attracting new consumers to our home carbonation system at the rate we believe should be achieved.  The third quarter results are a clear indication that we must alter our course and improve our execution across the board. We have already begun a strategic shift of the SodaStream brand towards health & wellness, primarily in the U.S., where we believe this message will resonate more strongly with consumers. In addition, we are developing a comprehensive growth plan for the Company that will encompass Marketing, Product and Innovation, Distribution, Operations and Organization. We intend to share more specifics around our growth plan when we report third quarter results later this month."

Because, frankly, right now we have no idea how to turn around the Titanic after it has hit the Iceberg.

What the sellside "analysts" were saying until yesterday:

And the punchline:

Mr. Birnbaum concluded, "We have a strong balance sheet and are well positioned with ample liquidity to invest in the areas of our business that we believe will fuel profitable growth in the years ahead. Despite our current challenges, we continue to be very confident in our business model and the global prospects for SodaStream. We firmly believe that our actions to shift the brand and improve execution will strengthen our leadership position in the home carbonation category and deliver enhanced shareholder value."

A soda company having "ample liquidity"? Literally, yes. Otherwise, see GTAT about the whole "strong balance sheet" thing. Also: why not blame the weather, snow, Easter, school holidays, seasonal or Bush. Everyone else is doing it.

At this point all we can advise SODA is to do more Scarlett ads as nothing else is working. May as well go out with a, er, fizz.

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LULZBank's picture

We are not in bubbles Bitchezz!!

SoilMyselfRotten's picture

SODA, the stock with 0-calories

Headbanger's picture

Most fucking stupid thing...

 

Meanwhile... Back in Ebola news....

http://dfw.cbslocal.com/2014/10/06/neighbors-of-ebola-patient-facing-dis...

Exactly what I said would happen here last week!!

NoDebt's picture

It's like ISDN used to be from the telephone company.  Interesting, but no.

(Industry insiders used to joke that ISDN stood for I Still Don't Need it)

PT's picture

It Still Does Nothing

nuclearsquid's picture

Fuck soda stream. Look up FizzGiz.  Made here in the good ole USA, not Israel, and it carbonates anything!

aVileRat's picture

You missed the point, well done. Also thanks for finding me a new chewtoy.

 

MillionDollarBogus_'s picture

A height weigh proportional woman selling a home soda machine..??

Yea, right.......

The WallyWorld article (ending health care for the less than 30 hours per week staff) could have been co-joined with this article.

Fizzy sweet water is liquid death.......

dynomutt's picture

It does have a niche.  Apparently, it's used regularly by radio personalities and voiceover artists who work from home.

 

The reasons: QoS and a wide audible range.  It's HD telephone.

 

Also, ISDN Data over Voice was a way of getting a double-speed dialup connection that was all digital, but one paid only for the cost of setting up two calls.  It required compatible equipment on both ends and the ILEC had to have the voice tariff on voice connections to not be per-minute.

Bearhug Bernanke's picture

Sodastream, dead. To be replaced by Ebolastream. Coming to a home near you!

fockewulf190's picture

If they can do some re-engineering magic and combine the Sodastream with a Sybian and get Scarlett to ride it, they will become billionaires.

SilverIsKing's picture

Aren't they in the whippet business? I'm surprised people aren't interested in nitrous oxide. What have they moved onto? Did the legalization of pot have anything to do with SODAs demise? Have they failed to use the whippet angle in their marketing strategy? This one looked like an easy win but they blew it.

curbjob's picture

My wife loves her sodastream ... with cheap chardonnay you can drink bubbles everyday.

Kirk2NCC1701's picture

"Tiny bubbles, in the wine
Make me happy, make me feel fine." - Don Ho

palmdetroit's picture

Seems so simple.. Americans guzzle soda 247.. so much easier to have a machine making it on demand and they don't even need to leave the house.. must really of fucked up somewhere

GetZeeGold's picture

 

 

Unless it's overpriced and shiek......American's don't want anything to do with it.

 

Plus I don't think SodaStream took EBTs.

Zhuge Liang's picture

besides, the product requires that the consumer actually (well kinda) make something...   Americans are too stupid and lazy these days for anything like.... 

Harbanger's picture

If you follow US trends you would know people aren't into soda like they once were.  It was a lousy idea.  A Breville citrus press on the other hand is a great idea.

MOB666's picture

The last time i was in the states i recall at one of the fast food resturants a rather large man pouring sugar into his already sugary unlimited refill drink..

 

why isnt america dead already?

PT's picture

Last time I tried SodaStream it didn't taste very nice but that was a long time ago.  I should have been one of their best customers.  These days I don't crave much sugary drink.  Tastes change - I think I OD'd when I was younger.  Are these guys another victim of an aging demographic?

Harbanger's picture

Thank you.  Times change, people change, ideas change.  They're victims of an aging mindset.

jerry_theking_lawler's picture

actually have one of these contraptions. got a deal on it 'used'....did the math, costs about 1/2 of regular 2L soda. plus, I can add all of the fizzy I want to it. there is also a fairly large variety of flavors. the major hangup I see with it is the price of entry. if they could get their machine down to $20 bucks, this baby would probably do well....and from what i see of the quality, its not worth $20 bucks. they need to sacrifice some machine margins to get the volumes up...

just saying.

RealityCheque's picture

Wait, so people don't want to make drinks at home which will give them diabetes and cancer??

Well, thats just a shocking result.

ParkAveFlasher's picture

But it saves us a trips to da 7-11! 

Richard Chesler's picture

Actually they would, if they could only afford the copays and deductibles of Obozocare.

 

Jlasoon's picture

7/11 Big Gulp is what? $0.79. lol

HardAssets's picture

I never heard of it and don't care.

I'll stick to nice ice cold water - absent of fluoride and other garbage.

Other than that . . . . a good beer from a local brewery and whiskey once in a while when in the mood.

Some of us get to the point when the nearest 'fad' means nothing.

 

PT's picture

and he must be ooooollld to call Soda Stream a fad!  ~30 year old "fad"?

LULZBank's picture

Is Nespresso next?

Stormtrooper's picture

Beer Stream is next. I can't wait!

Fix It Again Timmy's picture

Americans are already drowning in a sea of soda, what's the hook?  Well, there is none especially when MOAR work is involved than just swiping a soda off a grocery shelf.  Consumers - 1, Brainiacs - 0...Game over, man.....

KidHorn's picture

I can buy five 12 packs of coke/pepsi for $11 on sale. Why do I need to make my own?

Quinvarius's picture

You might be too fat to leave the house if you drink 5 x 12 packs of coke.  Surely your legs will be amputated due to diabetes at some point.  I recommend this product for you.

Headbanger's picture

What?

A surgical chain saw??

Overfed's picture

Takes me damn near six months to get through a short case of Pepsi or Coke. Sometimes longer. Soda pop was meant to be an occasional treat, not sustenance. Beer is for sustenance.

Dungholio's picture

Because they created a machine for you to and they are asking you nicely.

Taffy Lewis's picture

Yeah, the local storebrand soda is 89 cents a liter for all flavors imaginable, and when on sale is 59 cents.

The cost of HFCS (High Fructose Corn Syrup) must be negative. The water in the bottle is more valuable.

Overfed's picture

The plastic bottle is the most expensive component.

homiegot's picture

If Ronco was making this crap it would sell.

kridkrid's picture

While you might be joking, that's actually the first thing that crossed my mind when I read the headline. Why would this product be the vehicle for a publicly traded company? It's a late-night infomercial, airline catalog, temporary space at Bed Bath and Beyond kind of a product. You get in and you get out... make some money during the short fad and then you're on to next pet rock.

Karlus's picture

Completely unlike my new Model S85D sporting about 5 GoPro Black Edition cameras....

ParkAveFlasher's picture

Totally not like my iPhone!

p00k1e's picture

I’m developing a tissue that when used will determine if the nose blower has a virus or bacterial infection…  (Yeast testing will be included later as an upgrade.)

Which PR firm do we hire to get $100,000,000 cash??   It’s going to be big!

Colonel Klink's picture

They Flu off the shelf or did they come up cold?  It's the mucus that binds us.

ParkAveFlasher's picture

Good luck getting financing to mass-produce a cheap, effective, humanity-serving, and therefore disruptive technology, there, Jon Galt.  See you on the train tracks, I'm the guy in the plaid coveralls.

Dungholio's picture

How about releasing a fizzy ebola flavor!!!  That will sell!

urrterrible's picture

Cancel my 11am haircut Scarlett