By Brad Sorensen, CFA
NASDAQ: PRE
READ THE FULL PRE RESEARCH REPORT
Prenetics Global Limited (NASDAQ: PRE) continues to demonstrate that its transformation into a fast-growing global consumer health company is about much more than the extraordinary early success of its flagship IM8 nutrition brand we’ve been telling investors about. The recent announcement of a 10-year exclusive worldwide partnership with Authentic Brands Group to develop and commercialize a new family wellness brand, Care Bears by IM8, represents what we believe is an important expansion of the company’s addressable market, distribution opportunities, and long-term revenue potential. Perhaps most importantly, it demonstrates management’s ambition to leverage its proven digital marketing, product development, and subscription capabilities to establish an entire portfolio of recognizable consumer health brands.
The agreement brings together two significant assets: IM8’s rapidly developing reputation for premium, science-backed nutritional supplements and Care Bears’ extraordinary global brand recognition, built over more than four decades. Under the arrangement, Prenetics will serve as the exclusive operating partner, recognize all revenue generated by Care Bears by IM8, and pay royalties to Authentic Brands Group. We also like that Authentic will become a strategic shareholder in Prenetics, aligning the interests of the two companies in building the new business.
A major opportunity in the global nutritional supplements market
The initial Care Bears by IM8 product lineup will feature gummy multivitamins for children and adults, with a worldwide launch planned for the first half of 2027, coinciding with the 45th anniversary of Care Bears. The products will emphasize the same quality standards that helped establish IM8, including science-backed formulations, third-party testing, and guidance from scientific and medical advisers. The gummies are planned to be vegan, sugar-free, and free of gelatin, artificial colors, and artificial flavors.
The market opportunity is substantial. According to market research cited by Prenetics, the global gummy supplements market was valued at approximately $24.4 billion in 2025 and is expected to reach $47.8 billion by 2030, representing a compound annual growth rate of 14.4%. Additionally, the global children’s dietary supplements market was estimated at approximately $26 billion in 2025, within an overall vitamins and supplements market of roughly $164 billion. Although these categories overlap, their size underscores the potential demand for convenient nutritional products targeting children and adults.
We believe a key advantage of the partnership is that Prenetics will not be introducing an unfamiliar brand into this highly competitive market. Care Bears has generated more than $12 billion in cumulative retail sales and has a presence in more than 190 countries and 26 languages. Its recognizable characters appeal not only to children but also to adults who grew up with the franchise. This multigenerational recognition should give Prenetics a marketing advantage compared with introducing an entirely new consumer brand. While brand recognition alone does not guarantee sales, it can reduce the time and expense required to introduce products to customers and retailers.
The expansion also addresses a different consumer segment than IM8’s existing flagship product. IM8 Daily Ultimate Essentials primarily targets adults seeking premium, comprehensive nutritional supplementation. Care Bears by IM8 will target children, parents, and consumers interested in a more convenient gummy format. This distinction creates the opportunity for incremental sales rather than simply shifting customers from one Prenetics product to another.
Management envisions Care Bears by IM8 as an entire family wellness platform rather than merely a gummy vitamin line. Future products could include healthier confectionery, children’s snacks, and other food and wellness offerings. Successfully extending the franchise into these categories would allow Prenetics to participate in additional large consumer markets while leveraging the same established brand identity.
Expanding distribution beyond direct-to-consumer
Another attractive aspect of the agreement to us is its potential to accelerate Prenetics’ entry into traditional retail distribution. While IM8 has achieved impressive growth primarily through direct-to-consumer sales, subscriptions, and online marketing, Care Bears by IM8 is being developed for both digital and physical retail channels.
Authentic Brands Group brings an extensive international licensing and commercial network, while Care Bears itself has more than 500 licensing partners worldwide. This provides potential access to pharmacies, supermarkets, major retail chains, and warehouse clubs, creating opportunities to reach millions of consumers who might never encounter IM8 through online advertising.
We think it’s apparent that the financial implications could be significant. Retail distribution would diversify Prenetics’ sources of revenue, reduce reliance on digital customer acquisition, and introduce its products to entirely new consumer groups. Meanwhile, the company’s existing subscription infrastructure could encourage repeat purchases and support long-term customer relationships.
Importantly, the agreement does not require Prenetics to purchase the Care Bears intellectual property outright. Instead, the company obtains exclusive rights to commercialize the new wellness brand while paying royalties to Authentic. This structure offers substantial market access without the potentially enormous capital commitment of acquiring a globally recognized brand, although contractual royalty obligations and marketing expenses will affect profitability.
A compelling addition to an already impressive growth story
The Care Bears announcement builds upon an exceptional period of growth for Prenetics. Since launching IM8 in December 2024, the company has established one of the fastest-growing premium nutrition businesses in the industry, driven by its flagship Daily Ultimate Essentials product, which combines 90 ingredients into one daily nutritional drink. Co-founded with David Beckham, IM8 has expanded into 46 countries, benefiting from an international ambassador network that includes prominent athletes and entertainment personalities.
The financial results demonstrate that the company’s growth strategy is producing meaningful results. During the second quarter of 2026, IM8 generated $45 million in revenue, representing approximately 359% year-over-year growth and marking its sixth consecutive record quarter. July revenue reached $20.9 million, equivalent to an annualized revenue run rate of approximately $251 million. While this annualized figure is not guaranteed future revenue, it illustrates the impressive pace at which the business has expanded.
Prenetics has increased its full-year 2026 revenue guidance to $220 million–$230 million and established a 2027 IM8 revenue target of at least $400 million. Significantly, the 2027 guidance excludes revenue from Care Bears by IM8 and other upcoming product launches, creating the possibility of meaningful upside if these initiatives achieve commercial success.
The company’s broader product expansion includes planned launches in hydration and creatine, both of which address growing markets and provide opportunities to generate additional sales from existing customers. The growing product portfolio should also improve customer lifetime value, an important consideration for a subscription-oriented business.
Prenetics has also demonstrated progress toward financial sustainability. In July 2026, the company achieved its first month of positive consolidated adjusted free cash flow, and management subsequently expressed confidence that positive adjusted free cash flow could continue through the third quarter and beyond. This is an important milestone because it suggests that rapid revenue expansion is beginning to translate into improved operating economics, rather than simply requiring continually increasing marketing expenditures. The company also secured a $1 billion customer-acquisition growth financing commitment from General Catalyst’s Customer Value Fund, providing a potential mechanism for financing further expansion, subject to the facility’s terms.
Of course, the Care Bears agreement is not without financial obligations on the Prenetics side. The licensing agreement includes guaranteed minimum royalties and share consideration for Authentic, potentially creating additional costs and dilution for existing shareholders. Furthermore, the new products have not yet launched, so their commercial potential remains unproven. Nevertheless, Prenetics’ existing operating infrastructure and its partner’s established brand recognition provide a credible foundation for commercializing the new franchise.
Investment outlook
Today’s announcement is especially encouraging to us because it demonstrates that Prenetics is evolving from a successful single-brand supplement business into a potentially much larger global consumer health platform. Management is pursuing a strategy that combines recognizable global brands, premium nutritional formulations, efficient digital marketing, subscription revenue, and increasingly diversified distribution channels.
The Care Bears partnership provides Prenetics with an established international consumer franchise, access to attractive and rapidly expanding markets, and an opportunity to build additional revenue streams without having to create an entirely new brand identity. Moreover, Authentic’s decision to become a strategic shareholder provides an additional indication of its commitment to the venture.
For investors, the most compelling aspect of the announcement is the possibility that Prenetics’ substantial existing growth trajectory may be only the beginning. With IM8 targeting at least $400 million in revenue during 2027, several additional product categories under development, and Care Bears by IM8 introducing an entirely new family-focused growth platform, Prenetics has multiple opportunities to expand revenue beyond its current projections.
We view today’s announcement as a meaningful positive development for Prenetics shareholders. While execution, product adoption, licensing costs, and profitability remain important considerations, the agreement strengthens our argument that Prenetics is building a scalable international consumer health business with significant long-term growth potential. If management can replicate even a portion of IM8’s remarkable commercial success with the Care Bears franchise, the resulting incremental revenue and customer diversification could meaningfully enhance the company’s future earnings power and investment appeal.
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