Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2018	Apr. 26, 2018
Document and Entity Information
Entity Registrant Name	Monster Beverage Corp
Entity Central Index Key	0000865752
Document Type	10-Q
Document Period End Date	Mar. 31, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		562,681,834
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q1

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
CURRENT ASSETS:
Cash and cash equivalents	$ 511,360	$ 528,622
Short-term investments	585,222	672,933
Accounts receivable, net	525,463	449,476
Inventories	268,607	255,745
Prepaid expenses and other current assets	61,639	40,877
Prepaid income taxes	86,257	138,724
Total current assets	2,038,548	2,086,377
INVESTMENTS	3,497	2,366
PROPERTY AND EQUIPMENT, net	231,199	230,276
DEFERRED INCOME TAXES	85,748	92,333
GOODWILL	1,331,643	1,331,643
OTHER INTANGIBLE ASSETS, net	1,036,661	1,034,085
OTHER ASSETS	12,836	13,932
Total Assets	4,740,132	4,791,012
CURRENT LIABILITIES:
Accounts payable	226,063	245,910
Accrued liabilities	80,893	87,475
Accrued promotional allowances	155,992	137,998
Accrued distributor terminations	162	91
Deferred revenue	44,325	43,236
Accrued compensation	16,829	34,996
Income taxes payable	9,758	10,645
Total current liabilities	534,022	560,351
DEFERRED REVENUE	328,300	334,354
OTHER LIABILITIES	2,203	1,095
COMMITMENTS AND CONTINGENCIES (Note 11)
STOCKHOLDERS' EQUITY:
Common stock - $0.005 par value; 1,250,000 shares authorized; 629,924 shares issued and 562,605 outstanding as of March 31, 2018; 629,255 shares issued and 566,298 outstanding as of December 31, 2017	3,150	3,146
Additional paid-in capital	4,170,565	4,150,628
Retained earnings	3,137,691	2,928,226
Accumulated other comprehensive loss	(13,721)	(16,659)
Common stock in treasury, at cost; 67,319 shares and 62,957 shares as of March 31, 2018 and December 31, 2017, respectively	(3,422,078)	(3,170,129)
Total stockholders' equity	3,875,607	3,895,212
Total Liabilities and Stockholders' Equity	$ 4,740,132	$ 4,791,012

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands	Mar. 31, 2018	Dec. 31, 2017
CONDENSED CONSOLIDATED BALANCE SHEETS
Common stock, par value (in dollars per share)	$ 0.005	$ 0.005
Common stock, shares authorized	1,250,000	1,250,000
Common stock, shares issued	629,924	629,255
Common stock, shares outstanding	562,605	566,298
Common stock in treasury, shares	67,319	62,957

CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
NET SALES	$ 850,921	$ 742,146
COST OF SALES	335,664	261,272
GROSS PROFIT	515,257	480,874
OPERATING EXPENSES	235,342	216,612
OPERATING INCOME	279,915	264,262
INTEREST and OTHER INCOME, net	1,805	658
INCOME BEFORE PROVISION FOR INCOME TAXES	281,720	264,920
PROVISION FOR INCOME TAXES	65,670	86,940
NET INCOME	$ 216,050	$ 177,980
NET INCOME PER COMMON SHARE:
Basic (in dollars per share)	$ 0.38	$ 0.31
Diluted (in dollars per share)	$ 0.38	$ 0.31
WEIGHTED AVERAGE NUMBER OF SHARES OF COMMON STOCK AND COMMON STOCK EQUIVALENTS:
Basic (in shares)	566,000	571,578
Diluted (in shares)	574,129	582,032

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Net income, as reported	$ 216,050	$ 177,980
Other comprehensive income:
Change in foreign currency translation adjustment	2,723	1,201
Available-for-sale investments:
Change in net unrealized gains	215	131
Net change in available-for-sale investments	215	131
Other comprehensive income	2,938	1,332
Comprehensive income	$ 218,988	$ 179,312

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 216,050	$ 177,980
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	13,991	11,183
Gain on disposal of property and equipment	(187)	(268)
Stock-based compensation	13,439	13,142
Deferred income taxes		1,862
Effect on cash of changes in operating assets and liabilities:
Accounts receivable	(72,699)	7,441
Distributor receivables	3,279	(951)
Inventories	(11,274)	(7,793)
Prepaid expenses and other current assets	(19,646)	(11,368)
Prepaid income taxes	52,410	25,601
Accounts payable	(22,616)	(19,317)
Accrued liabilities	(14,985)	6,788
Accrued promotional allowances	15,971	14,111
Accrued distributor terminations	71	315
Accrued compensation	(18,350)	(15,802)
Income taxes payable	(1,059)	(5,506)
Other liabilities	1,108
Deferred revenue	(6,592)	(4,454)
Net cash provided by operating activities	148,911	192,964
CASH FLOWS FROM INVESTING ACTIVITIES:
Sales of available-for-sale investments	334,216	71,553
Purchases of available-for-sale investments	(247,421)	(58,314)
Purchases of property and equipment	(13,049)	(19,093)
Proceeds from sale of property and equipment	3,397	452
Decrease (Increase) in intangibles	280	(848)
Increase in other assets	(1,549)	(52)
Net cash provided by (used in) investing activities	75,874	(6,302)
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on debt	(543)	(700)
Issuance of common stock	6,501	13,621
Purchases of common stock held in treasury	(251,950)	(64)
Net cash (used in) provided by financing activities	(245,992)	12,857
Effect of exchange rate changes on cash and cash equivalents	3,945	(764)
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS	(17,262)	198,755
CASH AND CASH EQUIVALENTS, beginning of period	528,622	377,582
CASH AND CASH EQUIVALENTS, end of period	511,360	576,337
Cash paid during the period for:
Interest	16	19
Income taxes	$ 15,223	$ 66,094

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS SUPPLEMENTAL DISCLOSURE OF NON-CASH ITEMS (Parenthetical) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS NON-CASH SUPPLEMENTAL DATA
Capital lease for acquisition of promotional vehicles	$ 0.1	$ 1.0
Accrued liabilities for intangibles	8.3	$ 6.2
Accounts receivable on short-term investments	$ 11.5

BASIS OF PRESENTATION	3 Months Ended
BASIS OF PRESENTATION	Mar. 31, 2018
BASIS OF PRESENTATION
BASIS OF PRESENTATION	1.BASIS OF PRESENTATION Reference is made to the Notes to Consolidated Financial Statements, in Monster Beverage Corporation and Subsidiaries (the “Company”) Annual Report on Form 10-K for the year ended December 31, 2017 (“Form 10-K”) for a summary of significant accounting policies utilized by the Company and its consolidated subsidiaries and other disclosures, which should be read in conjunction with this Quarterly Report on Form 10-Q (“Form 10-Q”). The Company’s condensed consolidated financial statements included in this Form 10-Q have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and Securities and Exchange Commission (“SEC”) rules and regulations applicable to interim financial reporting. They do not include all the information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP. The information set forth in these interim condensed consolidated financial statements for the three-months ended March 31, 2018 and 2017, respectively, is unaudited and reflects all adjustments, which include only normal recurring adjustments and which in the opinion of management are necessary to make the interim condensed consolidated financial statements not misleading. Results of operations for periods covered by this report may not necessarily be indicative of results of operations for the full year. The preparation of financial statements in conformity with GAAP necessarily requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from these estimates.

RECENT ACCOUNTING PRONOUNCEMENTS	3 Months Ended
RECENT ACCOUNTING PRONOUNCEMENTS	Mar. 31, 2018
RECENT ACCOUNTING PRONOUNCEMENTS
RECENT ACCOUNTING PRONOUNCEMENTS	2.RECENT ACCOUNTING PRONOUNCEMENTS Recently issued accounting pronouncements not yet adopted In February 2018, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2018-02 (ASU No. 2018-02), “Income Statement—Reporting Comprehensive Income (Topic 220)”, which amends the previous guidance to allow for certain tax effects “stranded” in accumulated other comprehensive income, which are impacted by the Tax Cuts and Jobs Act (the “Tax Reform Act”), to be reclassified from accumulated other comprehensive income into retained earnings. This amendment pertains only to those items impacted by the new tax law and will not apply to any future tax effects stranded in accumulated other comprehensive income. This standard is effective for fiscal years beginning after December 15, 2018, and allows for early adoption. The Company is currently evaluating the impact of ASU No. 2018-02 on its financial position, results of operations and liquidity. In January 2017, the FASB issued ASU No. 2017-04, “Intangibles and Other (Topic 350): Simplifying the Test for Goodwill Impairment”, which eliminates the requirement to calculate the implied fair value of goodwill, but rather requires an entity to record an impairment charge based on the excess of a reporting unit’s carrying value over its fair value. This amendment is effective for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted. The Company is currently evaluating the impact of ASU No. 2017-04 on its financial position, results of operations and liquidity. In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”. The accounting standard changes the methodology for measuring credit losses on financial instruments and the timing when such losses are recorded. ASU No. 2016-13 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019. Early adoption is permitted for fiscal years, and interim periods within those years, beginning after December 15, 2018. The Company is currently evaluating the impact of ASU No. 2016-13 on its financial position, results of operations and liquidity. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)”. This update is intended to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This update is effective for annual and interim reporting periods beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact of ASU No. 2016-02 on its financial position, results of operations and liquidity. Recently adopted accounting pronouncements In May 2017, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2017-09, “Compensation–Stock Compensation (Topic 718): Scope of Modification Accounting”, clarifying when a change to the terms or conditions of a share-based payment award must be accounted for as a modification. The new guidance requires modification accounting if the fair value, vesting condition or the classification of the award is not the same immediately before and after a change to the terms and conditions of the award. The new guidance was effective for the Company on a prospective basis beginning on January 1, 2018, with early adoption permitted. The adoption of ASU No. 2017-09 did not have a material impact on the Company’s financial position, results of operations and liquidity. In January 2017, the FASB issued ASU No. 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business”, which clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This amendment was effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The adoption of ASU No. 2017-01 did not have a material impact on the Company’s financial position, results of operations and liquidity. In October 2016, the FASB issued ASU No. 2016-16, “Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory”, in an effort to improve the accounting for the income tax consequences of intra-entity transfers of assets other than inventory. Current GAAP prohibits the recognition of current and deferred income taxes for an intra-entity asset transfer until the asset has been sold to an outside party. FASB ASU No. 2016-16 establishes the requirement that an entity recognizes the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. ASU No. 2016-16 was effective for financial statements issued for annual periods beginning after December 15, 2017 and interim periods within those annual periods. The Company adopted ASU No. 2016-16 effective January 1, 2018 on a modified retrospective basis, resulting in a $6.6 million reclassification of the unrecognized income tax effects related to assets transfers that occurred prior to the adoption from deferred income taxes to opening retained earnings. In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230)”. The new guidance is intended to reduce diversity in practice in how certain transactions are classified in the statement of cash flows. ASU No. 2016-15 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. The guidance requires application using a retrospective transition method. The adoption of ASU No. 2016-15 did not have a material impact on the Company’s financial position, results of operations and liquidity. In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)”, which superseded previous revenue recognition guidance. ASU No. 2014-09 and its amendments were included in Accounting Standards Codification (“ASC”) 606 “Revenue from Contracts with Customers”. ASC 606 requires that a company recognize revenue at an amount that reflects the consideration to which the company expects to be entitled in exchange for transferring goods or services to a customer. The Company adopted ASC 606 effective January 1, 2018, using the modified retrospective approach, with no impact to the opening retained earnings. Results for periods beginning on or after January 1, 2018 are presented under ASC 606, while prior periods are not adjusted and continue to be reported in accordance with the prior accounting guidance under ASC 605 “Revenue Recognition”. See Note 3.

REVENUE RECOGNITION

3 Months Ended

Mar. 31, 2018

REVENUE RECOGNITION

REVENUE RECOGNITION

3.REVENUE RECOGNITION

The Company currently has three operating and reportable segments, (i) Monster Energy® Drinks segment (“Monster Energy® Drinks”), which is comprised of the Company’s Monster Energy® drinks, Monster Hydro® energy drinks and Mutant® Super Soda drinks, (ii) Strategic Brands segment (“Strategic Brands”), which is comprised of the various energy drink brands acquired from The Coca-Cola Company (“TCCC”) in 2015, and (iii) Other segment (“Other”), which is comprised of certain products sold by American Fruits & Flavors LLC, a wholly-owned subsidiary of the Company, to independent third-party customers.

The Company’s Monster Energy® Drinks segment generates net operating revenues by selling ready-to-drink packaged energy drinks primarily to bottlers and full service beverage distributors. In some cases, the Company sells directly to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience chains, drug stores, food service customers and the military.

The Company’s Strategic Brands segment primarily generates net operating revenues by selling “concentrates” and/or “beverage bases” to authorized bottling and canning operations. Such bottlers generally combine the concentrates and/or beverage bases with sweeteners, water and other ingredients to produce ready-to-drink packaged energy drinks. The ready-to-drink packaged energy drinks are then sold to other bottlers and full service distributors and to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience chains, food service customers, drug stores and the military. To a lesser extent, our Strategic Brands segment generates net operating revenues by selling certain ready-to-drink packaged energy drinks to bottlers and full service beverage distributors.

The majority of the Company’s revenue is recognized when it satisfies a single performance obligation by transferring control of its products to a customer. Control is generally transferred when the Company’s products are either shipped or delivered based on the terms contained within the underlying contracts or agreements. Certain of the Company’s bottlers/distributors may also perform a separate function as a co-packer on the Company’s behalf. In such cases, control of the Company’s products passes to such bottlers/distributors when they notify the Company that they have taken possession or transferred the relevant portion of the Company’s finished goods. The Company’s general payment terms are short-term in duration. The Company does not have significant financing components or payment terms. The Company did not have any material unsatisfied performance obligations as of March 31, 2018 or December 31, 2017.

The Company excludes from revenues all taxes assessed by a governmental authority that are imposed on the sale of its products and collected from customers.

Distribution expenses to transport the Company’s products, where applicable, and warehousing expense after manufacture are accounted for within operating expenses.

There were no changes to the Company’s accounting for variable consideration under ASC 606. Promotional and other allowances (variable consideration) recorded as a reduction to net sales, primarily include consideration given to the Company’s bottlers/distributors or retail customers including, but not limited to the following:

		discounts granted off list prices to support price promotions to end-consumers by retailers;
		reimbursements given to the Company’s bottlers/distributors for agreed portions of their promotional spend with retailers, including slotting, shelf space allowances and other fees for both new and existing products;
		the Company’s agreed share of fees given to bottlers/distributors and/or directly to retailers for advertising, in-store marketing and promotional activities;
		the Company’s agreed share of slotting, shelf space allowances and other fees given directly to retailers;
		incentives given to the Company’s bottlers/distributors and/or retailers for achieving or exceeding certain predetermined sales goals;
		discounted or free products;
		contractual fees given to the Company’s bottlers/distributors related to sales made by the Company direct to certain customers that fall within the bottlers’/distributors’ sales territories; and
		certain commissions paid based on sales to the Company’s bottlers/distributors.

The Company’s promotional allowance programs with its bottlers/distributors and/or retailers are executed through separate agreements in the ordinary course of business. These agreements generally provide for one or more of the arrangements described above and are of varying durations, ranging from one week to one year. The Company’s promotional and other allowances are calculated based on various programs with bottlers/distributors and retail customers, and accruals are established during the year for its anticipated liabilities. These accruals are based on agreed upon terms as well as the Company’s historical experience with similar programs and require management’s judgment with respect to estimating consumer participation and/or distributor and retail customer performance levels. Differences between such estimated expense and actual expenses for promotional and other allowance costs have historically been insignificant and are recognized in earnings in the period such differences are determined.

Upon adoption of ASC 606, commissions paid to TCCC based on sales to certain of the Company’s bottlers/distributors who are (i) consolidated subsidiaries of TCCC (the “TCCC Subsidiaries”), (ii) accounted for under the equity method by TCCC (the “TCCC Related Parties”) and (iii) those not included in (i) or (ii) (the “TCCC Independent Bottlers”) are accounted for as follows:

	Three-Months Ended March 31, 2018
Commissions Related To:	As Reported	Without Adoption of ASC 606
TCCC Subsidiaries	Reduction to net sales	Reduction to net sales
TCCC Related Parties	Reduction to net sales	Operating expenes
TCCC Independent Bottlers	Operating expenses	Operating expenes

The impact of the adoption of ASC 606 on the Company’s condensed consolidated statement of income for the three-months ended March 31, 2018 was as follows:

	Three-Months Ended March 31, 2018
	As Reported		Without Adoption of ASC 606		(Decrease) Increase due to Adoption of ASC 606
Net Sales	$	850,921	$	860,861	$	(9,940)	1
Operating Expenses	$	235,342	$	245,282	$	(9,940)	1

1 TCCC Commissions based on sales to the TCCC Related Parties. There were no other identified changes to our revenue recognition policies as a result of the adoption of ASC 606.

Disaggregation of Revenue

The following table disaggregates the Company’s revenue by geographical markets and reportable segments:

	Three-Months Ended March 31, 2018
Net Sales	U.S. and Canada		EMEA1		Asia Pacific		Latin America and Caribbean		Total
Monster Energy® Drinks	$	588,817	$	110,929	$	47,431	$	33,328	$	780,505
Strategic Brands	39,724		19,313		5,548		1,174		65,759
Other	4,657		-		-		-		4,657

Total Net Sales	$	633,198	$	130,242	$	52,979	$	34,502	$	850,921

1Europe, Middle East and Africa (“EMEA”)

Contract Liabilities

Amounts received from certain bottlers/distributors at inception of their distribution contracts or at the inception of certain sales/marketing programs are accounted for as deferred revenue. As of December 31, 2017, the Company had $377.6 million of deferred revenue, which is included in current and long-term deferred revenue in the Company’s condensed consolidated balance sheet. As of March 31, 2018, the Company had $372.6 million of deferred revenue, which is included in current and long-term deferred revenue in the Company’s condensed consolidated balance sheets. During the three-months ended March 31, 2018, $11.2 million of deferred revenue was recognized in net sales. See Note 10.

INVESTMENTS

3 Months Ended

Mar. 31, 2018

INVESTMENTS

INVESTMENTS

4.INVESTMENTS

The following table summarizes the Company’s investments at:

March 31, 2018	Amortized Cost		Gross Unrealized Holding Gains		Gross Unrealized Holding Losses		Fair Value		Continuous Unrealized Loss Position less than 12 Months		Continuous Unrealized Loss Position greater than 12 Months
Available-for-sale
Short-term:
Commercial paper	$	42,288	$	-	$	-	$	42,288	$	-	$	-
Municipal securities	441,360		-		508		440,852		508		-
U.S. government agency securities	74,773		-		107		74,666		107		-
Variable rate demand notes	27,416		-		-		27,416		-		-
Long-term:
Municipal securities	527		-		-		527		-		-
U.S. government agency securities	2,973		-		3		2,970		3		-

Total	$	589,337	$	-	$	618	$	588,719	$	618	$	-

December 31, 2017	Amortized Cost		Gross Unrealized Holding Gains		Gross Unrealized Holding Losses		Fair Value		Continuous Unrealized Loss Position less than 12 Months		Continuous Unrealized Loss Position greater than 12 Months
Available-for-sale
Short-term:
Commercial paper	$	81,026	$	-	$	-	$	81,026	$	-	$	-
Certificates of deposit	11,869		-		-		11,869		-		-
Municipal securities	469,604		1		740		468,865		740		-
U.S. government agency securities	61,307		-		88		61,219		88		-
Variable rate demand notes	49,954		-		-		49,954		-		-
Long-term:
U.S. government agency securities	2,369		-		3		2,366		3		-

Total	$	676,129	$	1	$	831	$	675,299	$	831	$	-

During the three-months ended March 31, 2018 and 2017, realized gains or losses recognized on the sale of investments were not significant.

The Company’s investments at March 31, 2018 and December 31, 2017 in commercial paper, certificates of deposit, municipal securities, U.S. government agency securities and/or variable rate demand notes (“VRDNs”) carried investment grade credit ratings. VRDNs are floating rate municipal bonds with embedded put options that allow the bondholder to sell the security at par plus accrued interest. All of the put options are secured by a pledged liquidity source. While they are classified as marketable investment securities, the put option allows the VRDNs to be liquidated at par on a same day, or more generally, on a seven-day settlement basis.

The following table summarizes the underlying contractual maturities of the Company’s investments at:

	March 31, 2018				December 31, 2017

	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Less than 1 year:
Commercial paper	$	42,288	$	42,288	$	81,026	$	81,026
Municipal securities	441,360		440,852		469,604		468,865
U.S. government agency securities	74,773		74,666		61,307		61,219
Certificates of deposit	-		-		11,869		11,869
Due 1 -10 years:
Municipal securities	527		527		-		-
U.S. government agency securities	2,973		2,970		2,369		2,366
Variable rate demand notes	6,622		6,622		6,366		6,366
Due 11 - 20 years:
Variable rate demand notes	18,542		18,542		28,377		28,377
Due 21 - 30 years:
Variable rate demand notes	2,252		2,252		15,211		15,211

Total	$	589,337	$	588,719	$	676,129	$	675,299

FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES

3 Months Ended

Mar. 31, 2018

FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES

FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES

5.FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES

Accounting Standards Codification (“ASC”) 820 provides a framework for measuring fair value and requires disclosures regarding fair value measurements. ASC 820 defines fair value as the price that would be received on the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available. The three levels of inputs required by the standard that the Company uses to measure fair value are summarized below.

Level 1: Quoted prices in active markets for identical assets or liabilities.

Level 2: Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities.

Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

ASC 820 requires the use of observable market inputs (quoted market prices) when measuring fair value and requires a Level 1 quoted price to be used to measure fair value whenever possible.

The following tables present the fair value of the Company’s financial assets and liabilities that are recorded at fair value on a recurring basis, segregated among the appropriate levels within the fair value hierarchy at:

March 31, 2018	Level 1		Level 2			Level 3		Total
Cash	$	394,221	$	-		$	-	$	394,221
Money market funds	39,228		-			-		39,228
Certificates of deposit	-		16,985			-		16,985
Commercial paper	-		60,825			-		60,825
Variable rate demand notes	-		27,416			-		27,416
Municipal securities	-		481,250			-		481,250
U.S. government agency securities	-		80,154			-		80,154
U.S. Treasuries	-		-			-		-
Foreign currency derivatives	-		(95		)	-		(95		)

Total	$	433,449	$	666,535		$	-	$	1,099,984


Amounts included in:
Cash and cash equivalents	$	433,449	$	77,911		$	-	$	511,360
Short-term investments	-		585,222			-		585,222
Accounts receivable, net	-		208			-		208
Investments	-		3,497			-		3,497
Accrued liabilities	-		(303		)	-		(303		)

Total	$	433,449	$	666,535		$	-	$	1,099,984


December 31, 2017	Level 1		Level 2			Level 3		Total

Cash	$	310,885	$	-		$	-	$	310,885
Money market funds	112,848		-			-		112,848
Certificates of deposit	-		15,720			-		15,720
Commercial paper	-		99,903			-		99,903
Variable rate demand notes	-		49,954			-		49,954
Municipal securities	-		529,984			-		529,984
U.S. government agency securities	-		81,230			-		81,230
U.S. Treasuries	-		3,397			-		3,397
Foreign currency derivatives	-		(1,484		)	-		(1,484		)

Total	$	423,733	$	778,704		$	-	$	1,202,437


Amounts included in:
Cash and cash equivalents	$	423,733	$	104,889		$	-	$	528,622
Short-term investments	-		672,933			-		672,933
Accounts receivable, net	-		95			-		95
Investments	-		2,366			-		2,366
Accrued liabilities	-		(1,579		)	-		(1,579		)

Total	$	423,733	$	778,704		$	-	$	1,202,437

All of the Company’s short-term investments are classified within Level 1 or Level 2 of the fair value hierarchy. The Company’s valuation of its Level 1 investments, which include money market funds, is based on quoted market prices in active markets for identical securities. The Company’s valuation of its Level 2 investments, which include municipal securities, commercial paper, certificates of deposit, VRDNs, U.S. Treasuries and U.S. government agency securities, is based on other observable inputs, specifically a market approach which utilizes valuation models, pricing systems, mathematical tools and other relevant information for the same or similar securities. The Company’s valuation of its Level 2 foreign currency exchange contracts is based on quoted market prices of the same or similar instruments, adjusted for counterparty risk. There were no transfers between Level 1 and Level 2 measurements during the three-months ended March 31, 2018 or the year ended December 31, 2017, and there were no changes in the Company’s valuation techniques.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

3 Months Ended

Mar. 31, 2018

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

6.DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

The Company is exposed to foreign currency exchange rate risks related primarily to its foreign business operations. During the three-months ended March 31, 2018 and the year ended December 31, 2017, the Company entered into forward currency exchange contracts with financial institutions to create an economic hedge to specifically manage a portion of the foreign exchange risk exposure associated with certain consolidated subsidiaries’ non-functional currency denominated assets and liabilities. All foreign currency exchange contracts of the Company that were outstanding as of March 31, 2018 have terms of one month or less. The Company does not enter into forward currency exchange contracts for speculation or trading purposes.

The Company has not designated its foreign currency exchange contracts as hedge transactions under ASC 815. Therefore, gains and losses on the Company’s foreign currency exchange contracts are recognized in interest and other income (expense), net, in the condensed consolidated statements of income, and are largely offset by the changes in the fair value of the underlying economically hedged item.

The notional amount and fair value of all outstanding foreign currency derivative instruments in the condensed consolidated balance sheets consist of the following at:

March 31, 2018
Derivatives not designated as hedging instruments under FASB ASC 815-20	Notional Amount		Fair Value		Balance Sheet Location

Assets:
Foreign currency exchange contracts:
Receive USD/pay GBP	$	33,290	$	139	Accounts receivable, net
Receive USD/pay ZAR	20,255		65		Accounts receivable, net
Receive NOK/pay USD	1,746		4		Accounts receivable, net


Liabilities:
Foreign currency exchange contracts:
Receive USD/pay EUR	$	76,452	$	(85)	Accrued liabilities
Receive USD/pay AUD	16,909		(73)		Accrued liabilities
Receive USD/pay MXN	3,337		(29)		Accrued liabilities
Receive SGD/pay USD	3,296		(15)		Accrued liabilities
Receive USD/pay NZD	2,237		(4)		Accrued liabilities
Receive USD/pay TRY	5,435		(83)		Accrued liabilities
Receive USD/pay BRL	717		(8)		Accrued liabilities
Receive USD/pay CLP	2,545		(3)		Accrued liabilities
Receive USD/pay COP	3,286		(3)		Accrued liabilities

December 31, 2017
Derivatives not designated as hedging instruments under FASB ASC 815-20	Notional Amount		Fair Value		Balance Sheet Location

Assets:
Foreign currency exchange contracts:
Receive CAD/pay USD	$	4,892	$	61	Accounts receivable, net
Receive SGD/pay USD	223		2		Accounts receivable, net
Receive NOK/pay USD	1,534		18		Accounts receivable, net
Receive USD/pay BRL	1,806		1		Accounts receivable, net
Receive USD/pay COP	2,803		13		Accounts receivable, net


Liabilities:
Foreign currency exchange contracts:
Receive USD/pay GBP	$	31,342	$	(334)	Accrued liabilities
Receive USD/pay EUR	65,131		(642)		Accrued liabilities
Receive USD/pay AUD	17,238		(177)		Accrued liabilities
Receive USD/pay ZAR	21,311		(222)		Accrued liabilities
Receive USD/pay MXN	7,720		(126)		Accrued liabilities
Receive USD/pay NZD	1,826		(18)		Accrued liabilities
Receive USD/pay TRY	5,483		(52)		Accrued liabilities
Receive USD/pay CLP	1,112		(8)		Accrued liabilities

The net (losses) gains on derivative instruments in the condensed consolidated statements of income were as follows:

		Amount of (loss) gain recognized in income on derivatives
		Three-months ended
Derivatives not designated as hedging instruments under FASB ASC 815-20	Location of (loss) gain recognized in income on derivatives	March 31, 2018		March 31, 2017

Foreign currency exchange contracts	Interest and other income, net	$	(4,659)	$	(5,028)

INVENTORIES

3 Months Ended

Mar. 31, 2018

INVENTORIES

INVENTORIES

7.INVENTORIES

Inventories consist of the following at:

	March 31, 2018		December 31, 2017
Raw materials	$	84,594	$	78,834
Finished goods	184,013		176,911

	$	268,607	$	255,745

PROPERTY AND EQUIPMENT, NET

3 Months Ended

Mar. 31, 2018

PROPERTY AND EQUIPMENT, NET

PROPERTY AND EQUIPMENT, NET

8.PROPERTY AND EQUIPMENT, NET

Property and equipment consist of the following at:

	March 31, 2018		December 31, 2017
Land	$	44,260	$	47,373
Leasehold improvements	3,281		3,109
Furniture and fixtures	6,397		6,461
Office and computer equipment	15,191		14,506
Computer software	3,593		3,650
Equipment	156,626		148,434
Buildings	110,978		107,374
Vehicles	39,522		38,179

	379,848		369,086
Less: accumulated depreciation and amortization	(148,649)		(138,810)

	$	231,199	$	230,276

Total depreciation and amortization expense recorded was $10.9 million and $8.2 million for the three-months ended March 31, 2018 and 2017, respectively.

GOODWILL AND OTHER INTANGIBLE ASSETS

3 Months Ended

Mar. 31, 2018

GOODWILL AND OTHER INTANGIBLE ASSETS

GOODWILL AND OTHER INTANGIBLE ASSETS

9.GOODWILL AND OTHER INTANGIBLE ASSETS

The following is a roll-forward of goodwill for the three-months ended March 31, 2018 and 2017 by reportable segment:

	Monster Energy® Drinks		Strategic Brands		Other		Total
Balance at December 31, 2017	$	693,644	$	637,999	$	-	$	1,331,643
Acquisitions	-		-		-		-

Balance at March 31, 2018	$	693,644	$	637,999	$	-	$	1,331,643

	Monster Energy® Drinks		Strategic Brands		Other		Total
Balance at December 31, 2016	$	693,644	$	637,999	$	-	$	1,331,643
Acquisitions	-		-		-		-

Balance at March 31, 2017	$	693,644	$	637,999	$	-	$	1,331,643

Intangible assets consist of the following at:

	March 31, 2018		December 31, 2017
Amortizing intangibles	$	71,350	$	71,400
Accumulated amortization	(29,425)		(26,383)

	41,925		45,017
Non-amortizing intangibles	994,736		989,068

	$	1,036,661	$	1,034,085

Amortizing intangibles primarily consist of customer relationships. All amortizing intangibles have been assigned an estimated finite useful life and such intangibles are amortized on a straight-line basis over the number of years that approximate their respective useful lives, generally five to seven years. Total amortization expense recorded was $3.1 million and $3.0 million for the three-months ended March 31, 2018 and 2017, respectively.

DISTRIBUTION AGREEMENTS	3 Months Ended
DISTRIBUTION AGREEMENTS	Mar. 31, 2018
DISTRIBUTION AGREEMENTS
DISTRIBUTION AGREEMENTS	10.DISTRIBUTION AGREEMENTS In accordance with ASC No. 420 “Exit or Disposal Cost Obligations”, the Company expenses distributor termination costs in the period in which the written notification of termination occurs. The Company incurred termination costs of $7.0 million and $19.9 million for the three-months ended March 31, 2018 and 2017, respectively. Such termination costs have been expensed in full and are included in operating expenses for the three-months ended March 31, 2018 and 2017. In the normal course of business, amounts received pursuant to new and/or amended distribution agreements entered into with certain distributors, relating to the costs associated with terminating agreements with the Company’s prior distributors, are accounted for as deferred revenue and are recognized as revenue ratably over the anticipated life of the respective distribution agreement, generally 20 years. Revenue recognized was $11.2 million and $10.0 million for the three-months ended March 31, 2018 and 2017, respectively.

COMMITMENTS AND CONTINGENCIES	3 Months Ended
COMMITMENTS AND CONTINGENCIES	Mar. 31, 2018
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES	11.COMMITMENTS AND CONTINGENCIES The Company had purchase commitments aggregating approximately $56.5 million at March 31, 2018, which represented commitments made by the Company and its subsidiaries to various suppliers of raw materials for the production of its products. These obligations vary in terms, but are generally satisfied within one year. The Company had contractual obligations aggregating approximately $170.2 million at March 31, 2018, which related primarily to sponsorships and other marketing activities. The Company had operating lease commitments aggregating approximately $16.4 million at March 31, 2018, which related primarily to warehouse and office space. In February 2018, the working capital line limit for the Company’s credit facility with HSBC Bank (China) Company Limited, Shanghai Branch was increased from $9.0 million to $15.0 million. Interest on borrowings under the line of credit is based on the People’s Bank of China benchmark lending rates multiplied by 1.10. As of March 31, 2018, the Company had $10.6 million outstanding on this line of credit, including interest, which is included in accounts payable in the condensed consolidated balance sheet. Legal Proceedings Litigation – The Company has been named a defendant in numerous personal injury lawsuits, claiming that the death or other serious injury of the plaintiffs was caused by consumption of Monster Energy® brand energy drinks. The plaintiffs in these lawsuits allege strict product liability, negligence, fraudulent concealment, breach of implied warranties and wrongful death. The Company believes that each complaint is without merit and plans a vigorous defense. The Company also believes that any damages, if awarded, would not have a material adverse effect on the Company’s financial position or results of operations. State Attorney General Inquiry – In July 2012, the Company received a subpoena from the Attorney General for the State of New York in connection with its investigation concerning the Company’s advertising, marketing, promotion, ingredients, usage and sale of its Monster Energy® brand energy drinks. Production of documents pursuant to that subpoena was completed in approximately May 2014. On August 6, 2014, the Attorney General for the State of New York issued a second subpoena seeking additional documents and the deposition of a Company employee. On September 8, 2014, the Company moved to quash the second subpoena in the Supreme Court, New York County. The motion was fully briefed and was argued on March 17, 2015. On January 13, 2017, the Court issued an opinion in which it agreed with certain Company arguments regarding the scope of the subpoena and the Attorney General’s investigation, but denied the motion to quash and granted the Attorney General’s cross-motion to compel compliance. It is unknown what, if any, action the state Attorney General may take against the Company, the relief which may be sought in the event of any such proceeding or whether such proceeding could have a material adverse effect on the Company’s business, financial condition or results of operations. As there has been no activity on this matter for the past eight months, the Company intends to remove it from future reports. Furthermore, from time to time in the normal course of business, the Company is named in other litigation, including consumer class actions, intellectual property litigation and claims from prior distributors. Although it is not possible to predict the ultimate outcome of such litigation, based on the facts known to the Company, management believes that such litigation in the aggregate will likely not have a material adverse effect on the Company’s financial position or results of operations. The Company evaluates, on a quarterly basis, developments in legal proceedings and other matters that could cause an increase or decrease in the amount of the liability that is accrued, if any, or in the amount of any related insurance reimbursements recorded. As of March 31, 2018, the Company’s condensed consolidated balance sheet includes accrued loss contingencies of approximately $1.6 million.