Thank you, operator. Bonjour à tous.

Good morning, everyone, and welcome to GURU's fiscal 2026 first quarter results conference call. Joining me this morning is our CFO, Ingy Sarraf.

Let's turn to slide 5. Q1 2026 marks the third consecutive quarter of positive adjusted EBITDA and the strongest first quarter in GURU's history.

We delivered record first quarter net revenue of $8.8 million, up 14.7% year-over-year. Gross margin expansion to 63%, up 345 basis points, and our first EBITDA-positive Q1 since going public, achieved during our seasonally softer quarter.

Over the last several quarters, we have clearly demonstrated our ability to execute and deliver profitable growth. Our trailing 12-month net revenue rose 17%, alongside positive adjusted EBITDA of $0.8 million, a defining achievement that underscores the strength of our business model and marks our first sustained period of growth with profitability as a public company.

Let's turn to slide 6 for more details. In Canada, revenue increased 27.9% to $7.2 million.

This was driven by rigorous retail execution under the direct distribution model, continued zero-sugar innovation momentum, improved promotional discipline, and pricing execution. The transition back to direct distribution is now fully embedded operationally, and we are seeing the benefits flow through both revenue growth and gross margin expansion.

We now operate with greater agility, deeper retail engagement, and improved visibility across key banners. Turning to slide 7.

In the US, Q1 performance was impacted by elevated distributor inventory levels entering the quarter, as well as strong prior-year comparisons driven by wholesale club timing. Despite these dynamics, underlying consumer demand remains strong.

Consumer scan across our listed US natural retail accounts, including Whole Foods, increased approximately 15% over the last 12 weeks. In addition, early Q2 shipments have shown encouraging signs of recovery, with February shipments up over 50% versus the prior year as distributor inventory levels normalize.

Consumer scan data continues to support underlying demand strength. Beyond the near-term recovery, we're also actively in discussions with targeted distributors, partners, and retailers to expand our presence in the US market.

Over the past year, we have proven our ability to compete across our listed US retail partners, reaching top-performing brand at Whole Foods, ranking among the top three natural brands in the natural channel, and delivering rapid growth on Amazon. These achievements underscore our confidence in GURU's significant long-term growth potential in the US.

Turning to slide 8. We are very pleased with the evolution of zero-sugar lineup.

Since launching our zero line in the spring of 2024, we have rapidly expanded to six zero-sugar offerings, including two new sorbet-inspired innovations launched in Q1 and in Q2. Our zero line is uniquely positioned as 100% organic, zero sugar, no sucralose, no aspartame.

Within two years, we have built one of the most differentiated, clean-label, zero-sugar portfolio in the category. Our new sorbet-inspired series reflects our ability to innovate quickly while staying aligned with consumer demand for clean ingredients and modern flavor profiles, and it has already outperformed previous innovation launches.

Innovation complements our core portfolio and remains a primary growth driver in Canada and a key velocity builder in the US. Given current momentum, we plan to launch more new products before year-end.

I will now turn the call over to Ingy for a deeper look at our financial performance.

Thank you, Carl, and good morning, everyone. Let's turn to slide 10.

Let me walk you through the key financial and balance sheet highlights for Q1 2026. Net revenue increased 14.7% to $8.8 million, the highest Q1 in GURU's history, driven by strong Canadian performance, up 27.9%.

Gross profit reached $5.6 million, with gross margin expanding 345 basis points to 63.0% from 59.5% in Q1 2025. This improvement reflects the structural benefits of our direct distribution model in Canada, pricing discipline, trade optimization, and continued operational efficiencies.

SG&A expenses were flat year-over-year at $6.1 million, but improved significantly as a percentage of revenue, declining to 68.7% from 78.8%. Sales and marketing expenses decreased 7.6% to $3.0 million, reflecting improved marketing efficiency and disciplined investment allocation.

Net loss improved to $0.3 million compared to $1.3 million in Q1 2025, a 77.4% improvement driven by revenue growth, margin expansion, and disciplined expense management. Adjusted EBITDA reached $0.01 million compared to a loss of $1.1 million in Q1 2025.

This marks our third consecutive EBITDA-positive quarter and our first EBITDA-positive Q1 since going public, achieved during our historically softer seasonal quarter, which further demonstrates structural operational leverage. Turning to the balance sheet, we ended the quarter with $28.2 million in cash, cash equivalents, and short-term investments, no debt, and $10 million in unused credit facilities.

Our strong liquidity position gives us the flexibility to continue investing in high-return innovations, support distribution expansion, and maintain financial discipline. With that, I'll turn the call back to you, Carl, for closing remarks.

Thank you, Ingy. Let's turn to slide 12.

Q1 confirms three important structural shifts. First, we now operate with structurally improved gross margin profile.

Second, we have demonstrated sustained operating leverage, delivering three consecutive EBITDA-positive quarters. Third, our innovation engine led by zero sugar continues to strengthen our competitive positioning.

Looking ahead, our priorities remain very clear: expand distribution in high-return channels, continue scaling zero-sugar line, maintain pricing discipline and trade efficiency, protect gross margin while selectively investing in growth. We are proud of the progress achieved over the last 12 months.

We are energized by the momentum entering Q2, and we remain committed to disciplined execution as we continue our path towards sustained profitability. Merci.

Thank you. Operator, we'll now open the call to questions.

Hi, good morning, Carl and Ingy.

Good morning, Martin.

Good morning, Martin.

I was wondering if it would be possible, in order to get a better appreciation of your performance at retail, if we could get your scan data in Canada at retail during the quarter, and any comment on your performance at retail channels that are not tracked? That would be super helpful.

Of course, Martin. For consistency, I'll give you the combination of tracked and untracked, which is what is the more reliable measure for us.

That number is at plus 15% versus last year. If you look at the last 12 weeks versus the 12 weeks the same 12 weeks last year, we're up 15%.

That's really driven by untracked. Within untracked, you see club, and the club channel driving a lot, and dollar channel and e-com.

That's really where the the the growth is coming from. The US is, we as I said in my remarks, the the US is is the same.

It's around 15% as well. One other one other thing that I think might be worth mentioning is we we conduct a brand tracker a couple of times a year.

A couple of times a year, we we survey consumers to track our brand performance, and it looks at all sorts of brand brand metrics like awareness and consideration. One important metric that I wanted to share with you, Martin, was the what we call past six months purchases.

It's somewhat measures household penetration and how how many people try our brand, and that on that, we've seen a significant significant increase over the last quarter. Last year, we had something around we had a number around 25% of consumers who had purchased GURU in the last six months, and this year, it went up to 29%.

That's usually a really good indicator of trial, which is a good leading indicator to share to market share growth. When this indicator has grown in the past, we saw share growth grow further long after that.

We thought that was a positive one that that we could share with you, Martin, this morning. The short answer to your to your answer is 15% growth.

Thank you. Super.

Thanks for the color on the brand tracker. That's interesting.

Just going back on the scan data performance in Canada, up 15%. How does that compare to the industry?

It's a little bit ahead. Obviously, what we see from the industry is tracked, it's a little bit ahead of what we see in tracked.

We don't have visibility on other brands in untracked, obviously. The industry is grown.

Both in Canada and the US, the industry has been growing very healthy. The last number I saw was around 10%, but it varies week-to-week and month-to-month, but it's been really around a range of 10% to 15%.

Our goal is always to grow faster than the industry, and because we believe our brand has so much potential.

Yeah. Thank you for that.

Then any comments you can share, Carl, on how Q2 is tracking so far? Especially in Canada, Carl, you gave a lot of information on the US.

That was helpful, but maybe a bit more in Canada.

It's still it's still very early, only six weeks in. Sometimes we speak and we're a little bit deeper in the quarter, it's it's it's a little bit harder to say.

As as I as I said in my remarks, the US the US, what we we thought was really important that gives you that visibility, especially that that the February was really strong at 50%. What I can say about Canada is that so far, it's aligned to our plans, there's no no no surprise in the last month.

It's aligned to our plans. It's aligned to to what we want to achieve.

Usually, usually Q2 is for us like Q1 is always a little bit of a slower seasonal quarter, like we've seen in pretty much every single year in the past. Q2 is hopefully the spring and the sun is going to show up in Canada.

That's usually always helpful. Our brand tends to be somehow a little bit more seasonal the than in the industry.

Somehow our consumers are a little bit I guess they purchase a little bit less as a habit. When the sun starts shining and the weather is nicer, we see it go up significantly.

We will dial this up with a lot of activities. We just announced a launch of of the new zero Orange Raspberry Sorbet.

Not only are we launching this, but there's a marketing campaign that's going to come and support this. We have some spring activations in Costco, stay tuned for that, but we have some exciting stuff that's coming on that way.

Obviously, from a purely from a field activation, especially in the convenience stores, but also in the grocery stores, spring is usually a season where we see a lot more activity than in Q1. Like November, December, January is not a big activity month for energy drinks versus the spring.

A lot of exciting things coming in in Canada. Too early to give you any sort of guidance on where we're going to finish, but lots of lots of positive things going in the in the quarter.

Thank you. My last question.

You have talked a little bit about the US. Looks like it's a growth engine for you guys.

Last year, you've added two new board members that are American. I was wondering, how helpful have they been to unlock some opportunities for you guys in the US?

If you can, just give us a little bit of color as to how that's played out for you guys.

Of course. First, it's been great to bring people who have the experience, the knowledge of the US market, and people who have done it before, who understand how big of a challenge this is for us, right, and who are really deeply committed to making it work and believe in the potential of this brand.

It's been very refreshing for me and the management team to be surrounded by board members like this. That's the first thing.

Obviously, that board members are not there to do our job, they're there to support us, and that's exactly what they've been doing. From I would say the biggest benefit would be around clarity and alignment around the strategy.

We've been able to bounce this back, go back to who our consumer is, where they shop, where we should market, what should be the right strategy, and having US board members really helped us bring clarity and alignment. That clarity and alignment really helps us in a speed of execution point of view.

I would say this is at a higher level, and I understand your question might be a little bit more tactical around what do they do for you, and there are a few examples of this, right? First and foremost, their role is on strategy, but they have been able to help us opening doors with retailers, distributors, contacts from a marketing support point of view, bringing new people that can help us either on a fractional point of view or also on a permanent basis.

It's been really really helpful, and really thankful that they're there with us.

Super. Thanks for all the color, guys, and best of luck.

Thank you, Martin. Thank you.

Thank you. Good morning.

Good morning, Sean.

Good morning, Ingy. Good morning, Sean.

I have a couple of modeling questions, but first, I wanted to ask something kind of bigger picture. Carl, the category, both in the US and in Canada, I think it's been performing better than anybody sensed a year ago.

I think we were kind of afraid that we would be facing a lot of difficult comparisons in '26, and so far, categories is outperforming my expectations anyway. Are you, as a company, doing anything different because of that category growth?

Are you more aggressive, or are you pouncing on more opportunities, or is it affecting your strategy in any other way?

On our side, it really confirms our strategy. We're on the right path, right?

We're still a very small player in this huge industry that keeps growing beyond I would say most people's wildest expectations. It just makes the category a lot more attractive.

For us, even if the category wasn't growing, there's still so much room for us to grow as a better-for-you option in this massive industry that we're happy to see the industry growing, but there's still a lot of room to grow for us even if the industry wasn't growing. Obviously, we're happy that there's new consumers coming into this category every week, every day, and it just reaffirms that we're on the right path.

Because if you dive a little bit deeper and you dive into what's driving the category growth, right, there's a few things. First is zero sugar.

Zero sugar is really driving the growth. There's also a notion of cleaner ingredients.

Sometimes it's perceived, like many brands are growing and are perceived as being cleaner even though they're not necessarily cleaner. We offer a real clean, organic, better-for-you option, and we think long term this is going to pay off.

The other thing that's really driving growth is anything around flavors, right, a lot of flavor innovations, nostalgic flavors, playing on nostalgia and stuff, and so we are playing in that as well, right? On those three fronts that are driving the growth, we are there, as I mentioned in my remarks.

We launched six zero-sugar SKUs in the last two years. I think this is remarkable, and I think the team should get some credit for that, and it's been a lot of work, and we're very proud of the performance of this.

In a nutshell, I would say this is it. Obviously, with so much potential, the work is in our camp.

There's a lot of competition because the industry is so attractive, we need to do the work to put more eyeballs on our brand, we need to put more liquid on lips. We need to get more people to try GURU, because once they try GURU, we know how well and how much they repeat, and that's always been the strongest part of our brand is once people try it, they repeat so much, need to get more people into GURU.

That's a good segue then to the other part of that question. Just one of the things we're hearing from the Monsters and Celsiuses is new users coming in, but also more occasions, kind of increased frequency or times that people will drink energy drinks that are not just "I'm about to work out," or "I'm feeling pooped," or "I'm playing video games."

There's a lot more occasions. Given that, does that lead to any changes in your plans for distribution, outside of kind of the traditional cadre that is so important to the category?

Does it open up potential for expanding distribution even further?

The short answer is yes, but I would say it's all anchored in the consumer, as I mentioned before. We start with who is the GURU consumer, where do they shop, what are the main occasions that we can go after, what are they looking for?

Then once you have clarity on that, which we do, it becomes much easier to say, okay, which occasions are we going after, which retailers are we going after? Our plans in the last few years, we've been quite transparent, are aligned to that, right?

We've been very clear that e-commerce, Amazon was a big portion of our plan. We've put a lot more efforts on the club channel because the category is becoming more mainstream.

As the category is becoming more mainstream, some people are saying energy is the new soda, it's replacing some coffee occasions, right? We try to capture this.

As categories becoming more mainstream or it's a household staple, people are buying a little bit more in bulk, right, especially the health-conscious, white-collar consumer that we're targeting, which is a little bit less of a convenience channel, especially outside of Quebec. In Quebec, our consumer is mainstream, they do shop in convenience, but outside of Quebec, we have a consumer that's tends to stock up, right, on GURU.

They want to have GURU in their pantry, and this is where take-home format, for example, is something that we want to look at. Variety packs is something that we are increasingly putting emphasis on, right?

It's really part of how do we align with a category that's really becoming mainstream and that's part of really multiple dayparts. Energy drinks are no longer something that you consume once in a while because you're falling asleep.

It's really becoming something that people have as a daily habit, and that's really what's driving the growth, right?

I think another growth driver for some of the other companies has been identifying maybe where they were weak with the female consumer. I don't think that's the weakness that GURU has had traditionally, but even Celsius, which was pretty well-balanced, has picked up a lot more penetration to the female user.

Is this something that you would consider, or do you feel like you're already pretty well-balanced?

We're very well-balanced. Obviously, we're more balanced than the industry.

The industry has been historically a lot more masculine, and that's changing gradually, especially with some new brands that are coming that are really female-specific. We have always kept this brand very balanced from that point of view, and that's our intention, right, to remain like this.

Okay. If I can shift over to some modeling questions for Ingy.

Can you talk a little bit about the phasing of revenue this year? Is there anything kind of unusual that we should expect?

You did call out the US being down the first quarter, but up a lot in February. What other issues year-over-year I'm sure we'd be looking at in terms of phasing of revenue?

From a Q2 standpoint, even the club experience that we had in the US last year in Q1 had a bit also in Q2. Other than that, no, both in Q2 we're good on that front.

In Q3, remember it was the full first quarter post-PepsiCo, there was a one-time adjustment there, so that's something to look out for. After that, it should be fine in Q4.

We have good things planned like we did last year, I don't see any other top-of-mind kind of things.

Can you talk a little bit about what drove the gross margin expansion? Was there anything unusual, or is there anything that's going to reverse itself?

What should we expect there at the gross margin level?

The gross margin expansion was really a structural change, right, that came with the direct distribution and continued promotional and trade spend kind of rigor and discipline, same thing from a cost standpoint. It's really structural change and not one-time items that we're seeing at the gross margin level.

Okay. Helpful.

How about the marketing expenses were lower than I thought they would be. Is that a timing issue, or you're just getting a lot more bang for the buck?

There's two things in there. There is, of course, the fact like we've been saying, right, Sean, and we're working hard to make sure we invest in high-return initiatives, very targeted.

There's that mindset and that discipline that's really something that we're embracing and making sure we continue. Of course, there's some timing, like Carl mentioned, much lower seasonality period in Q1, you'll see much more activity in Q2, Q3 with our innovations and with consumers coming out to play, right?

Especially in Quebec, you know how it is. We just passed a quasi ice storm, and we can't wait for the nice weather.

It comes with activation.

Tell me about it. I'm looking at my phone, it's telling me how warm it is where I used to live.

Thank you very much.

Thank you.

Thank you, Sean.

I just want to thank everybody for joining us and sharing good energy. Have a great day.