Jones Soda Co has reported an improvement in second quarter net losses, but said it has "much work" to do in order to achieve long-term profitability.

For the quarter ended 30 June, net losses improved by 28% to US$2m over the previous year's net losses of $2.7m.

Revenue sank to $7.5m from $11.7m in 2008, which the company attributed to the discontinuance of the Jones Soda glass bottles at some of its major retailers and a reduction in demand.

The decrease was partially offset by a 34% increase in net sales to Canada for the quarter.

"While we are pleased with the improved efficiency of our organisation, we realise there is still much work to be done in order to achieve our goal of long-term profitability and positive cash flows," said Joth Ricci, president and CEO.

He added that further cost cutting would be necessary in the near future.

Operating expenses decreased 30% to $4m in the period, due to cost containment measures in the fourth quarter of 2008 and a reduction in force that reduced salaries and benefits expenses.