Jones Soda Co., a Seattle craft soda manufacturer known for its unique flavors and label images submitted by customers, is aggressively expanding beyond its traditional roots. Since entering the cannabis industry in 2021 through its Mary Jones product line. After a difficult 2024, the company will focus on alternative adult drinks as its main strategy.
“Jones Soda began the year with a positive outlook, but poor financial management in the second half of the calendar year hampered our growth. This tested the resilience of the company,” said newly-appointed CEO Scott Harvey during the fourth quarter earnings call.
It reported an increase of 15% in revenue for 2024 to $19.1 Million, however, its net losses grew from $4.9M in 2023, to $9.9M in 2024 due, among other things, to financial pressures caused by competing in many beverage categories at once.
Jones’ hemp-derived HD9 products, which launched in January 2024, raked in $1.7 million in revenue during their first year – a bright spot for the company as it navigates a market more saturated by the day. In its cannabis THC sector, the company also recorded modest revenue growth. $1.3m in revenue was generated in 2024 compared to $1.2m in 2023.
The overall cannabis beverage sector – particularly with hemp – has seen a boon since states began legalizing recreational marijuana use, with major beverage companies and startups alike introducing THC and CBD-infused drinks. Canopy Growth Corp. and Hexo have been established players for many years.
Harvey recognized the rapid evolution of the regulatory environment around hemp-derived products that has created opportunities as well as uncertainty for his company.
We are closely watching the HD9 market. Harvey noted that they “understand the changes in regulation being contemplated by attorneys general of the various states and the congressional bodies,” Harvey added. The company was also actively engaging regulatory agencies to ensure compliance.
Harvey quoted trend data that suggested “over three years, 1 out of every 5 dollars spent within the drink category will be on Mary Jones products, which are substitutes for the traditional adult drinks such as wine and beer.”
The company has historically shifted its focus to cannabis and hemp drinks, a pivot that represents a significant strategic shift for a brand which had struggled with profitability ever since it was founded in 1995. Jones, after reaching its peak in popularity during the early 2000s faced stiff competition both from large soda companies and new craft beverage brands, which caused years of financial struggle.
CFO Brian Meadows – who previously held executive positions at Black Rifle Coffee Company, Nathan’s Famous and Dunn Brothers Coffee – emphasized the need for financial discipline going forward, noting that the company has implemented new processes for contract review and approval.
Jones has the best products to concentrate on. Our contract review process is a well-oiled machine. Meadows stated that marketing spends are only approved if they have a clear return on investment. Scott Harvey and I have been working closely with the team to improve supply chain processes and inventory control.
Jones also secured a new revolving $5 million credit facility in Feburary to alleviate liquidity concerns for an industry that is so capital-intensive. This new facility offers a “larger, more flexible credit limit” which allows customers to use their purchase orders and accounts receivables as collateral.
Jones is pursuing a three-pronged strategy focusing on core soda, modern soda and adult beverages – an approach that Harvey said positions the company to compete effectively in multiple growing segments rather than relying solely on its legacy soda business or emerging cannabis offerings. It is the result of a vision that was set by Paul Norman who spoke about corrective measures during the prior quarterly update.
The expanded network of the company now has 81 partners spread across 37 states. Its products are available in leading retailers like Kroger and Albertson-Safeway. Mary Jones HD9 signed 32 distributors since the launch of its line, with four more in 2025’s first quarter to extend into new states.