When photos of a brand-new Kirkland Signature energy drink started flooding social media feeds in late March 2026, the reaction was swift and loud. Shoppers were excited. Celsius investors were not. Within a single trading day, Celsius Holdings shares fell around 7% after Costco Wholesale began selling a private-label energy drink that directly competes with the company's products. The question everyone is now asking: is this the beginning of the end for one of the hottest beverage brands of the last decade, or is Wall Street overreacting to a can of sparkling peach water?
The answer, as it turns out, is more interesting than the headline.
What Costco Actually Dropped
Image credit: Costco
Costco rolled out Kirkland Signature sparkling energy drinks this week, offering a 24-pack for $16.99 in peach, orange, and tropical flavors. At roughly 70 cents per 12-ounce can, the math is pretty simple — and pretty compelling for anyone who has been shelling out north of a dollar and a half for Celsius at the same warehouse.
Each can contains 200 milligrams of caffeine, seven essential vitamins, and zero sugar. Made with no artificial food dyes, the energy drinks offer 250% of the daily value of vitamin B12, have no high fructose corn syrup, and are non-GMO. The formula is not exactly revolutionary, but it doesn't need to be. It checks every box that health-conscious energy drink consumers have come to expect.
The full ingredient list includes carbonated filtered water, green tea extract, caffeine, guarana seed extract, taurine, glucuronolactone, sucralose, vitamin C, and a full lineup of B vitamins including niacin, B6, B12, and pantothenic acid. That's a solid stack. Nothing exotic, nothing missing. The kind of formula that gets the job done without trying to reinvent anything.
Costco already has its own energy shot, similar to 5 Hour Energy, but this is their first energy drink. That distinction matters. Costco has been in the energy business in a limited way for years, but stepping into the full-sized can market is a different move entirely — and it clearly caught the industry off guard.
The Price Gap Is Real, and It's Big
There is no way to sugarcoat the price difference here. At roughly 70 cents per 12-ounce can, the Kirkland product undercuts Celsius significantly on price. By comparison, Celsius 24-packs sell for $37.99 online at Costco, or $1.58 per can for single-flavor options. That's a gap of more than 50 percent. On a per-can basis, over the course of a month for someone drinking one a day, that difference adds up to real money.
Costco recently introduced its Kirkland Signature Sparkling energy drink at roughly a 55% discount to Celsius products, triggering the recent selloff. And that selloff, while understandable from a gut-reaction standpoint, is what analysts are now calling an overreaction.
Social Media Said It First
Before any analyst wrote a note, the internet had already made up its mind. As is always the way when a lower-priced, just-as-good dupe hits stores, people rushed to grab these new energy drinks to try them for themselves. The peach flavor emerged as the early favorite, with shoppers across social media platforms posting reviews, comparisons, and side-by-side photos of the Kirkland can next to a Celsius can.
The visual similarity did not go unnoticed. Many people tweeted their suspicions that the Kirkland Signature beverage was just repackaged Celsius, or at the very least, manufactured by the company. One social media user put it less diplomatically, suggesting that anyone who couldn't figure out the two were connected was beyond help. Whether or not that theory holds water, it speaks to how closely the products resemble each other in everything from the sparkling format to the ingredient philosophy.
On X, one user pointed out that Kirkland Signature has a proven method for breaking into industries with its white-label products, noting that the company caps the Kirkland margin to 15%, usually a single-digit percentage for the supplier, with a focus on volume. That's the Costco playbook in a nutshell — squeeze the margin, move the volume, and let the price do the talking.
Google search interest for the query "Costco energy drinks" spiked during the week of March 23. That kind of organic curiosity is not something you can manufacture with an ad budget. It's what happens when a product genuinely surprises people.
What Celsius Is Working With
To understand why most analysts aren't panicking about Celsius long term, it helps to understand what the company has built over the past year or so. This isn't the same Celsius that was scrapping for shelf space a few years ago. In April 2025, Celsius Holdings acquired Alani Nu for approximately $1.8 billion. Alani Nu had already become one of the fastest-growing energy drink brands in the United States, driven by a women-focused positioning, influencer-led marketing, and a distinctive flavor profile.
In August 2025, PepsiCo increased its stake in Celsius Holdings with a $585 million deal. As part of the agreement, Celsius Holdings acquired the Rockstar Energy brand for the U.S. and Canadian markets. PepsiCo simultaneously locked in as the exclusive distribution partner for all three brands across the U.S. and Canada. That's Celsius, Alani Nu, and Rockstar all moving through the same distribution network — one of the most powerful in the beverage business.
Celsius first partnered in 2022 with PepsiCo on distribution for its namesake line of drinks. The partnership also included a $550 million stock investment from PepsiCo, earning the company its first seat on the Celsius board.
The Q4 2025 numbers told a story that the Costco news briefly overshadowed. Celsius Holdings greatly outperformed analyst expectations, reporting Q4 earnings of $0.26 per share on revenue of $721.63 million. Consensus estimates predicted $0.19 per share on revenue of $638.18 million. That's not a company limping into a fight. That's a company that just posted the kind of quarter that earns you a long leash from Wall Street.
Celsius Holdings launched its first LTO from Alani, Cherry Bomb, under the new PepsiCo distribution network in late 2025, and the flavor sold out in record time. The ability to create limited-time releases that move fast and generate buzz is something Kirkland is simply not set up to do.
What the Analysts Are Actually Saying
The professional money isn't running from Celsius. If anything, the dip created something closer to a buying conversation on Wall Street.
TD Cowen reiterated a buy rating on Celsius with a $66 price target, implying about 83% upside from the stock's last close. TD Cowen said the pullback appears overdone, noting that Costco accounted for only about 10% of Celsius' 2025 sales and that private-label competition has historically struggled in the energy drink category.
That last point is worth sitting with. Private-label energy drinks are not new. They have existed in various forms for years, and they have consistently failed to displace the brands that have built real consumer loyalty. The energy drink category is different from, say, paper towels or olive oil. People are emotionally attached to their brands in a way that doesn't transfer easily to a store label — no matter how good the deal is.
JPMorgan analyst Andrea Teixeira wrote in a note, "We view Celsius as well positioned for strong growth as the company benefits from continued consumption momentum in the energy drinks category, strong distribution runway and shelf space gains from its expanded partnership with PepsiCo, and innovation track record."
On Wall Street, 18 of 22 analysts rate Celsius a buy or strong buy, while the rest recommend hold. Their average price target of $68.05 suggests the stock is trading at roughly a 90% discount to that level.
UBS raised its price target for Celsius Holdings to $72, maintaining a buy rating due to strong earnings performance. Meanwhile, Morgan Stanley reiterated an Overweight rating with a $64.00 price target, noting a sequential slowdown in energy drink growth but still recognizing a 20% increase in sales for the recent two-week period.
The Kirkland Limitation Nobody Is Talking About
Here's the structural issue with the Costco threat that tends to get lost in the excitement about the price: Kirkland is Costco's private-label brand. These new drinks will only be sold in Costco's 900-plus stores worldwide. You won't see them next to Celsius at Target or Walmart. You won't see them in the cooler section at a convenience store.
That geographic and retail confinement is a ceiling that Celsius simply does not have. Celsius is expanding its footprint through PepsiCo's distribution network into channels that Kirkland will never reach — foodservice, convenience stores, gyms, universities, and on and on. Every new shelf that Celsius earns is one that Kirkland cannot compete on.
Costco not only sells its Kirkland brand, but many third-party brands as well. Consumers who are not loyal to other energy drinks may give this one a shot due to its low cost. Costco also sells brands like Ghost, Alani, Red Bull, Celsius, and Bloom. In other words, Costco is selling a product that competes against several of the brands it also stocks on its own shelves. That's an unusual position for a retailer to be in, and it limits how aggressively they can really push the Kirkland version.
Celsius could quickly scale up new flavors, new liquid concoctions, and revamped packaging. Costco isn't doing any of this. A private-label brand at a warehouse club is not a platform for innovation. It's a value proposition. And value propositions, while powerful, don't build the kind of brand loyalty that keeps consumers reaching for the same can for years.
The Bigger Picture for the Category
ResearchandMarkets estimates the global energy drink market, roughly $78 billion in 2025, will grow at a compound annual growth rate of 5.91% for the next five years to reach about $104 billion by the end of the decade. That's not a market that one warehouse club's private label is going to choke off. It's a market that's growing fast enough to support multiple winners across multiple price points.
Celsius Holdings CEO John Fieldly stated: "The category is growing, new consumers are coming in, and more females are coming in now than ever before. And that's a large segment of the Celsius Holdings portfolio that we're capturing." That demographic expansion is exactly what a growing brand looks like. Kirkland, by contrast, sells to whoever walks through Costco's doors.
Celsius Holdings has demonstrated robust revenue growth of 50.8% over the past three years, reflecting its strong market demand and effective distribution strategies. The company's gross margin stands at 50.39%, indicating efficient cost management and pricing power. Those are not the margins of a company that needs to panic because a warehouse store started selling a cheaper alternative.
What It Actually Means for the Guy Buying the 24-Pack
Here is where things get practical. If someone is already a Costco member and they've been spending $37.99 on a case of Celsius every few weeks, the Kirkland version at $16.99 is going to be hard to ignore on pure math. The peach flavor is getting a lot of buzz for being the standout, and generally speaking, people are reacting very positively across the board.
But the loyalty question is real. Energy drink consumers tend to know what they like, and they tend to stick with it. The ritual of reaching for the same brand is part of the appeal. A cheaper option that tastes slightly different — or even tastes the same — doesn't automatically replace that habit.
Maybe a Costco shopper tries a case of these Kirkland energy drinks to save a few bucks from their usual Celsius habit. But there's no guarantee they will stay loyal consumers. In fact, there is nothing worse than buying a case of new drinks that you end up hating — it's wasted money.
Twenty-four cans is a commitment. If the Kirkland version doesn't land the way someone hoped, that's a lot of mediocre experiences stacked in the garage fridge. Name brands don't just sell a product — they sell a known outcome. That consistency has real value, especially to someone who counts on an energy drink to perform at a specific moment in the day.
One bullish user on Stocktwits summed it up: "$CELH, $COST, It's like saying Coca-Cola is going to be replaced by Cola Drank because it's cheaper." It's a blunt comparison, but it's not wrong. Category leadership in beverages has rarely been toppled by a store brand, regardless of how attractive the price looks on the shelf.
The Bottom Line
Costco made a smart move. The Kirkland Signature Sparkling Energy Drink is a legitimately good-looking product at an aggressively low price, and it will sell well among Costco's massive membership base. It may pull some volume away from Celsius at that specific retail channel. That's real, and it's fair to acknowledge.
The stock closed at $36.53, down from $39.65 previously, with the 1-week return hitting -10.73%. TD Cowen views the decline as an overreaction. That framing — overreaction — keeps coming up from analysts who have actually looked at the numbers rather than just the headlines.
Celsius Holdings (CELH) shares have experienced a 15% decline this week triggered by Costco's introduction of a Kirkland-branded energy drink priced significantly lower. Despite this, analysts suggest the market's reaction may be exaggerated. Costco's contribution to Celsius revenue is meaningful but not existential. The rest of the distribution picture — PepsiCo's network, the Alani Nu acquisition, the Rockstar integration, and a growing consumer base — paints a very different story than a 15% stock drop implies.
Celsius also trades at about 22x forward earnings, a more attractive valuation compared with Monster Beverage Corp., which trades near 32x. For investors watching the space, that's a data point worth keeping in mind when the emotional reaction to a new Costco product starts to look like a buying opportunity.
Costco didn't start a war. It launched a product. And in the energy drink business, launching a product and building a brand are two very different things.
