SodaStream Q2 profits sparkle after successful rebranding initiative

SodaStream’s second quarter net profits jumped 120.8% to $7.8m, compared to $3.5m accrued in the same period last year. 

Quarterly revenue jumped 17.2% to $119.2m over last year's $101.7m.

SodaStream CEO Daniel Birnbaum attributed the accelerated growth to the company's rebranding as a sparkling water maker and said in a statement that the quarter's results "reinforce our confidence in the strategic course we have set for the Company."

Rebranding pays off

After SodaStream lost more than 75% of its market value between 2011 and 2015, the company decided it was time to shake up its image. They rebranded themselves as a designer machine of sparkling water and came up with a new slogan “Love Your Water.”

"Our work repositioning the SodaStream brand around sparkling water and effectively communicating the compelling benefits of our home carbonation system helped drive double-digit revenue growth in each of our four geographic regions," Birnbaum said.

The company said it sold an-all-time high of 7.5m gas refill units, 6m flavor units, and 637,000 carbonation machines in its second quarter.

Capitalizing on Keurig Kold failure

When its competitor Keurig Kold was discontinued mainly due to the device’s hefty price tag and failing short of consumers’ expectations, SodaStream offered Kold customers a  limited-time promotion to receive a free SodaStream sparkling water maker.

Consumers were given a promo code for the free SodaStream device after sending a selfie of themselves with the Kold and other providing other basic information to SodaStream.

 A sparkling trend

The bottled water market as a whole is expected to outsell  carbonated soft drinks by the end of 2016 with Americans  projected to drink 27.4 gallons each this year, according to Euromonitor.

Sparkling water sales in particular have been on the rise and many big brands are continuing to invest in their sparkling water products to take advantage of this bubbling consumer beverage trend.

For example, PepsiCo recently credited some its Q2 sales growth to the success of Aquafina Sparkling. Despite its bleak outlook of soda, Coca-Cola said it remains optimistic about its premium water offerings which includes Smartwater Sparkling and Dasani Sparkling.

Smaller brands are also cropping up each such as Tickle Water, a lightly-flavored sparkling water geared towards young kids.