Financial Data and Key Metrics Changes - The company reported revenue of $97 million, representing a 13% year-over-year growth [9][27] - Gross margin increased by 170 basis points to 39% [10][29] - Positive net income of $3 million was achieved, marking a $5 million increase from the previous year [31] - Adjusted EBITDA margin improved to 7%, up from 3% in the prior year [31][32] - The company ended the quarter with $73 million in cash and no debt outstanding [32] Business Line Data and Key Metrics Changes - The wipes portfolio and baby personal care collection were highlighted as strong performers, with wipes consumption growth exceeding 40% [13][14] - The sensitive skin portfolio grew by 35% year-over-year, driven by new product launches [13] - Diaper performance faced headwinds due to distribution changes at a key retailer, impacting overall growth [17][19] Market Data and Key Metrics Changes - The Honest brand's consumption growth of 8% outpaced the competitive categories, which declined by 1% [11][60] - Household penetration increased to 7.3%, a growth of 55 basis points year-over-year [11] - The diaper category remains under pressure, with a modest decline observed [58][90] Company Strategy and Development Direction - The company is focused on three transformation pillars: brand maximization, margin enhancement, and operating discipline [8][24] - A comprehensive approach to managing tariffs is in place, with a three-pronged strategy to mitigate impacts [21][34] - Continued investment in marketing and innovation is planned to support brand growth and product launches [49][92] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious confidence in navigating the evolving economic landscape while reaffirming the 2025 financial outlook [25][33] - The company anticipates a reversal of retailer inventory builds in the second quarter, impacting growth rates [28] - Management acknowledged the need for ongoing innovation in the diaper category to address consumer feedback [18][19] Other Important Information - The company announced the retirement of CFO Dave Loretta and the appointment of Curtis Bruce as the new CFO [5][6] - The Honest brand is now the leading natural wipes brand nationally, surpassing previous category leaders [16] Q&A Session Summary Question: Impact of shipping on sales and guidance for 2Q - Management noted that pull-forward shipments in 1Q were primarily due to Amazon, which will reverse in 2Q, impacting growth rates [41][43][45] Question: Marketing plans for 2025 - The company plans to continue strong investments in marketing, particularly for the new diaper launch and expanding wipes into new retailers [46][49] Question: Deceleration trends and category performance - Deceleration was primarily isolated to the Target channel, with strong performance in other markets [56][58][90] Question: Distribution and product portfolio growth - The company is focusing on a hero distribution strategy, increasing distribution in grocery and drug channels while managing overall points of distribution [68][70] Question: Tariff impact and mitigation strategies - Management discussed the ongoing tariff impacts, particularly from China, and emphasized their proactive strategies to manage costs [77][79][84]

Investor Strategic Update 2025 As of May 7, 2025 Forward Looking Statements This presentation contains certain forward-looking statements within the meaning of the federal securities laws, including statements about the outlook of our business and industry and other matters referenced in our earnings release and SEC filings. All statements other than statements of historical fact contained in this presentation, including statements on our business strategy, plans, objectives, financial results, operating re ...

PART I. FINANCIAL INFORMATION [Financial Statements](index=6&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) The company reported a **$3.3 million** net income in Q1 2025, a turnaround from a **$1.4 million** net loss, with total assets increasing to **$265.3 million** and operating cash flow at **-$2.9 million** [Notes to Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) - The company operates as a single reportable segment, with its CEO reviewing performance at the consolidated entity level, and substantially all revenue is from customers in the United States[26](index=26&type=chunk)[27](index=27&type=chunk) - Revenue from the Direct-to-Consumer (DTC) channel, Honest.com, constituted **11%** of total revenue in Q1 2025, down from **15%** in Q1 2024, reflecting a strategic shift[41](index=41&type=chunk) - The company has a **$35.0 million** revolving credit facility (2023 Credit Facility) maturing in April 2026, with no outstanding balance and **$30.3 million** available to be drawn as of March 31, 2025[47](index=47&type=chunk) - A securities litigation case was settled for **$20 million**, fully funded by the company's insurance carriers, with preliminary court approval on April 14, 2025[58](index=58&type=chunk)[83](index=83&type=chunk) - As of March 31, 2025, there was **$26.5 million** of unrecognized stock-based compensation expense related to unvested RSUs, expected to be recognized over a weighted-average period of **2.7 years**[67](index=67&type=chunk) - Subsequent to the quarter end, on May 7, 2025, the company announced the appointment of Curtiss Bruce as the new Chief Financial Officer, effective June 2, 2025[84](index=84&type=chunk) Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $72,818 | $75,435 | | Inventories | $90,262 | $85,266 | | Total current assets | $234,621 | $213,918 | | **Total assets** | **$265,304** | **$247,393** | | Total current liabilities | $73,957 | $59,889 | | **Total liabilities** | **$84,947** | **$73,086** | | **Total stockholders' equity** | **$180,357** | **$174,307** | Condensed Consolidated Statements of Comprehensive Income (Loss) (in thousands) | Account | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenue | $97,250 | $86,217 | | Gross profit | $37,670 | $31,882 | | Operating income (loss) | $2,507 | $(1,315) | | **Net income (loss)** | **$3,254** | **$(1,403)** | | **Diluted EPS** | **$0.03** | **$(0.01)** | Condensed Consolidated Statements of Cash Flows (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(2,938) | $336 | | Net cash used in investing activities | $(62) | $(76) | | Net cash provided by financing activities | $383 | $498 | | **Net (decrease) increase in cash** | **$(2,617)** | **$758** | [Management's Discussion and Analysis (MD&A)](index=25&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes **12.8%** revenue growth to increased wipes and baby personal care sales, with gross margin improving to **38.7%** and Adjusted EBITDA rising to **$6.9 million** [Transformation Initiative and Strategy](index=27&type=section&id=Transformation%20Initiative) - The company is executing a Transformation Initiative focused on three pillars: **Brand Maximization**, **Margin Enhancement**, and **Operating Discipline**, including a strategic shift away from the DTC channel[92](index=92&type=chunk)[93](index=93&type=chunk)[100](index=100&type=chunk) - A core growth strategy is to increase physical availability in retail stores, with plans to transition Honest.com to consumer education and marketing beyond 2025[96](index=96&type=chunk) [Results of Operations](index=35&type=section&id=Results%20of%20Operations) Comparison of Q1 2025 and Q1 2024 (in thousands) | Metric | Q1 2025 | Q1 2024 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | **$97,250** | **$86,217** | **$11,033** | **12.8%** | | Cost of Revenue | $59,580 | $54,335 | $5,245 | 9.7% | | **Gross Profit** | **$37,670** | **$31,882** | **$5,788** | **18.2%** | | *Gross Margin* | *38.7%* | *37.0%* | *N/A* | *+170 bps* | | SG&A | $21,041 | $22,420 | $(1,379) | (6.2)% | | Marketing | $12,270 | $9,096 | $3,174 | 34.9% | | R&D | $1,852 | $1,681 | $171 | 10.2% | | **Operating Income (Loss)** | **$2,507** | **$(1,315)** | **$3,822** | **N/A** | - Revenue growth was primarily driven by a **$9.7 million** increase in wipes revenue and a **$2.6 million** increase in baby personal care revenue[126](index=126&type=chunk) - Gross profit improvement was driven by sales volume growth, supply chain cost savings, and product mix, partially offset by a **$3.0 million** inventory write-down related to a new diaper renovation[109](index=109&type=chunk)[128](index=128&type=chunk) - The **34.9%** increase in marketing expense was due to a **$1.6 million** increase in digital brand advertising and a **$1.5 million** increase in retail marketing[132](index=132&type=chunk) [Liquidity and Capital Resources](index=38&type=section&id=Liquidity%20and%20Capital%20Resources) - As of March 31, 2025, the company had **$72.8 million** in cash and cash equivalents and believes this is sufficient to meet operational needs for the next **12 months**[135](index=135&type=chunk) Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash from operating activities | $(2,938) | $336 | | Net cash from investing activities | $(62) | $(76) | | Net cash from financing activities | $383 | $498 | - The **$2.9 million** cash used in operating activities in Q1 2025 was primarily due to a **$5.8 million** increase in inventory and a **$5.8 million** decrease in accounts payable and accrued expenses, partially offset by net income and non-cash adjustments[145](index=145&type=chunk) [Non-GAAP Financial Measures](index=42&type=section&id=Non-GAAP%20Financial%20Measure) Reconciliation of Net Income (Loss) to Adjusted EBITDA (in thousands) | Reconciliation Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Net income (loss)** | **$3,254** | **$(1,403)** | | Interest and other (income) expense, net | $(787) | $63 | | Income tax provision | $40 | $25 | | Depreciation and amortization | $717 | $717 | | Stock-based compensation | $2,412 | $2,523 | | Securities litigation expense | $1,036 | $402 | | Founder/CCO transition expense | $— | $158 | | Payroll tax expense related to stock-based compensation | $257 | $157 | | **Adjusted EBITDA** | **$6,929** | **$2,642** | [Controls and Procedures](index=46&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - Based on an evaluation as of March 31, 2025, the principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective[169](index=169&type=chunk) - There were no changes in the company's internal control over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, these controls[170](index=170&type=chunk) PART II. OTHER INFORMATION [Risk Factors](index=47&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks, including new tariffs on goods from China (up to **145%**) and North America (**25%**), alongside competition, customer reliance, and supply chain disruptions - A significant new risk factor relates to international trade disputes and tariffs, with the U.S. government announcing new tariffs in April 2025, including an additional **145%** on certain goods from China and **25%** on certain goods from Mexico and Canada[179](index=179&type=chunk) - These tariffs could directly impact key products, as baby wipes are imported from China and diapers are imported from Mexico, potentially leading to increased costs, price increases for consumers, or the need to shift manufacturing[179](index=179&type=chunk) - Other significant risks include potential loss of a major retail customer, failure to cost-effectively acquire and retain consumers, intense market competition, and the successful execution of strategic initiatives like the Transformation Initiative[175](index=175&type=chunk) [Other Information](index=47&type=section&id=Other%20Information) This section incorporates legal proceedings by reference, confirms no unregistered equity sales or senior security defaults, and notes no new 10b5-1 trading plans by officers or directors - Legal proceedings information is incorporated by reference from Note 7 of the financial statements[172](index=172&type=chunk) - No officers or directors entered into a 10b5-1 trading plan during the three months ended March 31, 2025[186](index=186&type=chunk)

Financial Performance - Revenue for Q1 2025 reached $97 million, a 13% increase from $86 million in Q1 2024[4] - Net income for Q1 2025 was $3 million, a significant improvement from a net loss of $1 million in Q1 2024[8] - Adjusted EBITDA increased to $7 million, up from $3 million, marking the sixth consecutive quarter of positive adjusted EBITDA[8] - Operating income for Q1 2025 was $2.5 million, compared to a loss of $1.3 million in the prior year[23] - Net income for the three months ended March 31, 2025, was $3,254 million, compared to a net loss of $1,403 million for the same period in 2024, indicating a significant turnaround[27] - Adjusted EBITDA for Q1 2025 was $6,929 million, up from $2,642 million in Q1 2024, reflecting a year-over-year increase of 162.5%[34] - Revenue for the three months ended March 31, 2025, was $97,250 million, compared to $86,217 million in Q1 2024, marking an increase of 12.4%[34] - Adjusted EBITDA margin improved to 7.1% in Q1 2025, compared to 3.1% in Q1 2024, indicating enhanced operational efficiency[34] Expenses and Liabilities - Operating expenses rose by $2 million to $35 million, but as a percentage of revenue, they decreased by 230 basis points[6] - Total current liabilities rose to $73,957 million as of March 31, 2025, up from $59,889 million at December 31, 2024, an increase of 23.5%[25] Cash and Assets - The company ended Q1 2025 with $73 million in cash and cash equivalents, an increase of $39 million year-over-year[9] - The company had no debt on its balance sheet as of March 31, 2025[9] - Total assets increased to $265,304 million as of March 31, 2025, up from $247,393 million at December 31, 2024, representing a growth of 7.7%[25] - Cash and cash equivalents decreased to $72,818 million at the end of Q1 2025 from $75,435 million at the beginning of the period, a decline of 4.3%[27] - Accounts receivable decreased to $42,759 million as of March 31, 2025, from $43,476 million at December 31, 2024, a reduction of 1.6%[25] - Inventories increased to $90,262 million as of March 31, 2025, compared to $85,266 million at December 31, 2024, reflecting a rise of 5.9%[25] - Stockholders' equity increased to $180,357 million as of March 31, 2025, up from $174,307 million at December 31, 2024, an increase of 3.0%[25] Outlook - The company reaffirmed its full-year 2025 outlook, expecting revenue growth of 4% to 6% and positive adjusted EBITDA in the range of $27 million to $30 million[11] - Consumption of the company's products at its largest digital customer increased by 28%[4]

Core Viewpoint - The Honest Company has appointed Curtiss Bruce as the new Chief Financial Officer, effective June 2, 2025, to drive the company's financial strategy and transformation efforts [2][4][6]. Company Overview - The Honest Company is a personal care company focused on creating cleanly-formulated and sustainably-designed products across various categories, including baby care, beauty, and household care [11]. Leadership Appointment - Curtiss Bruce brings over 30 years of experience, including 10 years in executive finance roles within the consumer products sector, and has previously worked with notable companies such as Hain Celestial Group, Keurig Dr. Pepper, Kellogg, and Kraft Heinz [3][4]. - As CFO, Bruce will report directly to CEO Carla Vernón and will lead the Finance, Accounting, and Investor Relations teams, focusing on the company's Transformation Pillars: Brand Maximization, Margin Enhancement, and Operating Discipline [4][6]. Strategic Focus - The company aims to continue its turnaround by executing its Transformation Pillars, which include driving profitability and operational efficiency while delivering shareholder value [4][6][7]. - Bruce expressed enthusiasm for the opportunity to contribute to the company's strategy of topline growth, margin expansion, and improved executional excellence [6]. Financial Outlook - The Honest Company reaffirms its 2025 financial outlook and remains confident in its long-term plans with Bruce leading the finance team [7].

Core Points - The Honest Company will report its first quarter 2025 financial results on May 7, 2025, after market close [1] - An investor conference call and webcast will be held on the same day at 1:45pm PT/4:45pm ET to review the financial results [2] - The Honest Company focuses on creating cleanly-formulated and sustainably-designed personal care products across various categories [3] Company Overview - The Honest Company was launched in 2012 and aims to challenge traditional ingredients and industry standards through its brand and mission [3] - The product categories include diapers, wipes, baby personal care, beauty, apparel, household care, and wellness [3] - For more information about the company and its standards, the website www.honest.com is available [3]

Core Insights - The article provides a summary of key news regarding Tesla for the week of April 7, 2025, highlighting important developments and stock performance [1]. Group 1 - Tesla's stock price was noted at a specific value on April 11, 2025, indicating market performance during that period [1].

LOS ANGELES, March 18, 2025 (GLOBE NEWSWIRE) -- The Honest Company (NASDAQ: HNST), a personal care company dedicated to creating cleanly-formulated and sustainably-designed products, today announced that it made an inducement grant to Mr. Etienne von Kunssberg in connection with his employment as The Honest Company’s new SVP, Supply Chain, effective February 24, 2025. Such grant was made under The Honest Company, Inc. 2023 Inducement Plan, which was approved and adopted on March 14, 2023, by the Company’s ...

The Honest Company (HNST 1.15%) held its fourth-quarter conference call on February 26, 2025, revealing insights into the company's ongoing transformation. Here are three key takeaways on the company's strategic direction and execution.Strong Financial Momentum Through Transformation StrategyThe Honest Company demonstrated that its multiyear transformation initiative (brand maximization, margin enhancement, and operating discipline) is delivering results, with record revenue and its first full year of posit ...

JP Morgan analyst Andrea Teixeira reiterated the Overweight rating on The Honest Company, Inc. HNST.On Wednesday, the company reported revenue of $100 million, which increased 11%. The quarterly gross margin of 39% expanded 530 basis points year over year.Teixeira notes that while EBITDA guidance exceeded expectations, bears may focus on the lack of EPS visibility, as the company will face easier comparisons in 2024 due to “extraordinary legal expenses.”Teixeira noted that management aims to rebuild its rep ...