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Rockstar Energy Sales Growth Returns After PepsiCo Revamps Brand

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  • Rockstar Energy sales are growing again under the ownership of PepsiCo, which bought the brand last year.
  • Pepsi has revamped the brand with a new logo, fresh packaging and its first-ever Super Bowl ad.
  • But Pepsi CEO Ramon Laguarta said it's still too early to tell if the brand is really pulling in new consumers and if they'll stick around.

Rockstar Energy's sales are growing again, following years of flat or even declining demand, after new owner PepsiCo revamped the brand several months ago.

Still, PepsiCo CEO Ramon Laguarta on Thursday told analysts that it's too early to tell if new consumers are trying Rockstar's energy drinks.

"I would say it's too early to recall whether we are really bringing new consumers to the brand and whether those consumers stay with the brand," he said. "I think we're going to need a few more quarters to really understand what's happening at the consumer level."

Pepsi bought the struggling drink brand last year for $3.85 billion as part of its broader push into more heavily caffeinated options, like the launch of Mtn Dew Rise in March. Rockstar had been losing market share to upstarts, and rival Monster Beverage is still the top energy drink maker.

Earlier this year, Rockstar aired its first-ever Super Bowl ad featuring rapper Lil Baby to reintroduce the brand to consumers. Cans of Rockstar also received a new logo and fresh packaging.

In Germany, Pepsi launched Rockstar Energy + Hemp earlier this month, but Laguarta told analysts that they shouldn't draw conclusions on whether the company will introduce the product elsewhere. However, the company is accelerating Rockstar's global expansion, and it plans to more than double its global footprint over the next three years.

The brand's revival comes as Pepsi prepares for consumer behavior to once again change as the pandemic winds down. The company is expecting demand for its North American beverage unit to rebound as more consumers return to restaurants, stadiums and movie theaters. Executives also said they're expecting a shift back to smaller packaging for snacks and drinks, but there's still some uncertainty about whether at-home consumption will stick around longer.

"I think the consumer will show us more as we go along in the next, I would say, six to nine months," Laguarta said.

Shares of Pepsi rose less than 1% in early trading Thursday after the company topped Wall Street estimates for its first-quarter earnings and revenue. Even as it faced tough comparisons due to last year's stockpiling, the company reported sales growth of 6.8%.

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