Financial Data and Key Metrics Changes - In 2024, the company achieved a revenue growth of 27% to $647 million and delivered adjusted EBITDA of $150 million at a margin of 23.3%, representing a 40% year-over-year increase in adjusted EBITDA [7][8] - The company generated $134 million of free cash flow, converting over 130% of net income into cash, and maintained strong momentum with revenue growth of 27% in Q4 [8][56] - The gross margin expanded to 72.7%, up 330 basis points year-over-year, exceeding guidance of 68% [53] Business Line Data and Key Metrics Changes - Both brands, Il Makiage and Spoiled Child, experienced double-digit revenue growth in 2024, with Il Makiage surpassing $500 million in revenue and Spoiled Child reaching $150 million [9][10] - The repeat sales metric increased significantly, with repeat revenue accounting for over 60% of total business revenue in 2024, up from less than 50% in previous years [12][82] Market Data and Key Metrics Changes - The company noted a shift towards online sales, which is expected to continue growing, with the belief that online penetration could double from current levels [14][77] - The company is strategically expanding its international presence, particularly in markets like the UK, Germany, and Australia, with positive early indications [25][26] Company Strategy and Development Direction - The company is focused on investing in growth areas such as Oddity Labs, new brands, and AI technologies to drive future growth [7][24] - The launch of brand three, a telehealth platform, is set for the second half of 2025, targeting medical-grade skin and body issues [28][100] - The company aims to leverage its direct-to-consumer model to maintain a competitive edge, avoiding excess inventory issues faced by wholesale brands [16][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to perform well despite macroeconomic challenges, citing strong repeat sales and a resilient business model [72][140] - The outlook for 2025 includes a commitment to achieving 20% revenue growth and a 20% adjusted EBITDA margin, despite planned investments in growth initiatives [59][60] Other Important Information - The company repurchased 3.6 million shares for approximately $147 million during 2024, with $103 million remaining on its buyback authorization [57][58] - The company exited 2024 with $169 million in cash equivalents and investments, maintaining a zero-debt position [58] Q&A Session Summary Question: Can you elaborate on your international strategy and why now? - Management indicated that the decision to accelerate international growth is strategic, focusing on smaller markets to spread growth effectively [71] Question: Are you seeing any weakness in consumer spending due to macro concerns? - Management noted that the shift to online sales is a significant factor, and they are not experiencing the same promotional pressures as competitors [75] Question: Can you provide insights on repeat purchases and growth from Il Makiage? - Management reported that repeat purchases account for over 60% of revenue, with a twelve-month net revenue repeat rate exceeding 100% [82] Question: What are the key milestones for brand three? - Management highlighted that brand three is set to launch with a focus on skin and body issues, with significant investments made to ensure a successful rollout [96][100] Question: How do you balance organic growth versus M&A for Oddity Labs? - Management stated that they are open to M&A opportunities to enhance capabilities, particularly in pharma, while also expanding their internal team [123]

Core Insights - Oddity Tech reported quarterly earnings of $0.20 per share, exceeding the Zacks Consensus Estimate of $0.13 per share, and showing an increase from $0.17 per share a year ago, resulting in an earnings surprise of 53.85% [1] - The company achieved revenues of $123.64 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 3.17% and increasing from $97.25 million year-over-year [2] - Oddity Tech has consistently outperformed consensus EPS and revenue estimates over the last four quarters [2] Earnings Outlook - The future performance of Oddity Tech's stock will largely depend on management's commentary during the earnings call and the sustainability of the recent price movements [3][4] - The current consensus EPS estimate for the upcoming quarter is $0.53 on revenues of $255.24 million, and for the current fiscal year, it is $1.74 on revenues of $772.64 million [7] Industry Context - The Internet - Software industry, to which Oddity Tech belongs, is currently ranked in the top 28% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Oddity Tech's stock performance [5][6]

Business Risks - The company faces substantial risks including negative publicity affecting brand value, which could adversely impact business and financial condition [31]. - The inability to anticipate market trends and changes in consumer preferences may negatively affect the company's operations and financial results [36]. - Attracting new customers and retaining existing ones is critical; failure to do so could harm revenue growth and overall business performance [37]. - The company relies on single-source suppliers for certain materials, and any disruptions could adversely affect its supply chain and financial condition [47]. - Regulatory changes, such as the EU AI Act, could impose compliance costs and restrict the company's use of AI technologies, impacting operations [46]. - Negative customer feedback or publicity regarding products or services could diminish customer loyalty and engagement [43]. - The company is subject to risks from supply chain disruptions, including natural disasters and industrial accidents, which could adversely affect operations [48]. - Significant investments in marketing and brand promotion are necessary to attract new customers, but these may not yield expected results [37]. - The company’s growth may slow over time, and recent rapid growth may not be sustainable, impacting future performance [34]. - The majority of suppliers are located in the United States, Italy, China, and Taiwan, and any operational interruptions in these regions could hinder product demand fulfillment [50]. - The company maintains business interruption insurance, but coverage may not be sufficient for catastrophic events, potentially impacting financial condition and operations [51]. - Accurate forecasting of customer demand is critical; failure to do so may lead to excess inventory or shortages, adversely affecting gross margins and brand strength [54]. - Recent rapid growth may not be sustainable, and future revenue growth could slow due to various market factors, including competition and demand fluctuations [56]. - The company faces competition from larger multinational consumer product companies, which may respond more quickly to market changes due to their resources [57]. - Fluctuating raw material costs could increase the cost of goods sold, negatively impacting financial results [59]. - Illegal distribution and sale of counterfeit products could harm brand reputation and net revenue [60]. - Shipping disruptions, including port congestion and labor disputes, could significantly affect business operations and customer satisfaction [63]. - Economic downturns or disruptions in business conditions may lead to decreased consumer spending on discretionary items, impacting sales [67]. - Sudden global disruptions, such as pandemics or geopolitical conflicts, could adversely affect consumer confidence and sales profitability [68]. Financial Performance - The company achieved profitability in 2020 after starting U.S. operations in 2018 [84]. - Revenue is typically highest in the first quarter of the calendar year, with a decline expected in the third and fourth quarters [83]. - The company plans to continue expanding into additional international markets, which may expose it to new risks [86]. - The company may require additional financing in the future, which could be difficult to obtain on favorable terms, potentially leading to significant dilution of existing shareholders' ownership interests [111]. - The company anticipates that its available funds and cash flow from operations will be sufficient for the foreseeable future, but uncertainties remain regarding future financing needs [111]. - The company's tax obligations may change significantly due to business expansion into jurisdictions with unfavorable tax laws, potentially affecting after-tax profitability and financial results [130]. - The overall effective tax rate may be materially affected by changes in tax benefits and grants for research and development [224]. Regulatory Compliance - The company is subject to numerous laws and regulations globally, which could result in delays, increased costs, and limitations on product sales and marketing [113]. - Compliance with evolving regulations, particularly in the EU regarding cosmetic products, may impact the company's ability to market and sell products effectively [116]. - The introduction of new AI regulations could increase operational costs and restrict opportunities for product development and deployment [122]. - Changes in international tax legislation, such as the OECD's Pillar Two proposal, may increase the company's tax liabilities and affect international expansion plans [127]. - The company faces potential adverse effects from new e-commerce tax regulations, which could increase operational costs and decrease the attractiveness of online sales [128]. - Regulatory developments related to climate change may impose additional compliance costs and affect the company's financial condition [125]. - The company may face significant costs and reputational harm if it fails to comply with applicable laws and regulations, particularly in the areas of data privacy and cybersecurity [119]. - The company is subject to various federal and state laws regarding automatically renewing subscription services, and non-compliance could result in legal fees and reputational harm [138]. - The evolving regulatory environment may lead to increased enforcement actions against the company, potentially resulting in fines, penalties, and negative publicity [142]. - The company is subject to various international laws regarding data privacy, which could lead to reputational harm and significant penalties for noncompliance [152]. - The California Consumer Privacy Act (CCPA) and the California Privacy Rights Act (CPRA) impose new obligations that may increase compliance costs and potential liabilities [160]. - The Virginia Consumer Data Protection Act (VCDPA) effective January 1, 2023, imposes additional compliance costs and requirements for data processing [161]. - The Colorado Privacy Act (CPA) effective July 1, 2023, requires compliance similar to VCDPA, increasing operational complexity [161]. - Compliance with Payment Card Industry Data Security Standard (PCI Standard) requires significant resources and ongoing attention, with risks of service disruptions from third-party processors [163]. - GDPR imposes fines of up to €20 million or 4% of annual global revenue for violations, affecting both third-party transactions and internal data transfers [169]. - UK GDPR creates parallel compliance requirements post-Brexit, increasing risk exposure due to potentially conflicting regulations [170]. - The new Data Privacy Framework (DPF) adopted on July 10, 2023, addresses cross-border data transfer concerns but may face challenges and increased scrutiny [167]. - Israeli Privacy Protection Law requires compliance with data processing and security regulations, with potential administrative fines and civil claims for non-compliance [172]. - ePrivacy Regulation may impose additional consent requirements, impacting sales and necessitating significant system changes [171]. - Changes in data transfer regulations may lead to increased operational costs and affect the company's ability to provide services across jurisdictions [168]. - The Personal Information Protection Law (PIPL) imposes penalties of up to CNY 50 million or 5% of annual revenue for non-compliance [174]. - Compliance with various data privacy laws may incur substantial operational costs and require changes in business practices [175]. - Evolving definitions of personal information may limit the company's ability to operate or expand its business [176]. - Increased regulation on consumer behavior data collection may lead to significant operational changes and potential fines [178]. Cybersecurity and Technology - The company relies heavily on information technology systems, and disruptions could adversely affect business operations and financial results [180]. - Cybersecurity incidents, including ransomware attacks, pose significant risks to the company's operations and reputation [183]. - The company maintains cybersecurity insurance, but coverage may not be adequate for all incidents [184]. - Unauthorized access or data breaches could result in legal claims, regulatory investigations, and significant penalties [185]. - The company has faced attempted cyberattacks in the past, which could lead to regulatory scrutiny and additional liability if not managed properly [188]. - The company may face significant costs and operational impacts due to potential cyberattacks and security breaches, which could adversely affect its financial condition and results of operations [189]. - The company relies on third-party payment processing services, which exposes it to risks related to compliance with payment card association rules and potential fines or higher transaction fees [191]. Intellectual Property - The company has invested in protecting its intellectual property, but there is no guarantee that its patents will be granted or that they will provide meaningful protection against competitors [194]. - The company has chosen not to register certain copyrights, which may limit its ability to seek remedies for unauthorized use of its software [195]. - The company may incur significant costs in monitoring and enforcing its intellectual property rights, and litigation could distract management and impair its business operations [197]. - The company’s trademarks and trade names may not be adequately protected, which could hinder its ability to build brand recognition and compete effectively [200]. - The company faces challenges in enforcing its intellectual property rights in foreign jurisdictions, which may not provide the same level of protection as in the United States [201]. - The company may be subject to claims of intellectual property infringement from third parties, which could result in substantial costs and impact its ability to market and sell its products [204]. - Any adverse outcomes from intellectual property disputes could require the company to cease using certain technologies or redesign its products, leading to additional costs [205]. - The company’s competitive position could be materially harmed if its trade secrets are independently developed or lawfully obtained by competitors [202]. Geopolitical Risks - The ongoing conflicts in Israel, including military actions and regional instability, could materially and adversely affect the company's business, financial condition, and results of operations [215]. - In September 2024, Moody's downgraded Israel's credit rating from A2 to Baa1, reflecting heightened geopolitical risks, which could disrupt the business environment and affect the company's ability to raise capital [216]. - The company may experience disruptions due to military reserve duty call-ups among its employees, which could impact its operations and financial performance [219]. - The company’s commercial insurance does not cover losses from events associated with war and terrorism, potentially exposing it to significant financial risks [217]. - The company’s operations could be negatively impacted by restrictions imposed by governmental agencies or companies that limit access to its products and services [211]. - The company is subject to risks related to the enforcement of U.S. judgments in Israel, which could complicate legal proceedings and affect its operations [220]. Operational Challenges - The company must maintain strong relationships with content creators to effectively promote its brands; failure to do so could hinder customer engagement [41]. - High-quality customer support is vital for revenue growth, and failures in this area could lead to decreased demand for products [109]. - The company must effectively manage its employee base and hiring needs to maintain business performance [75]. - The company faces intense competition for skilled personnel, particularly engineers, which could impact the company's growth strategy [73]. - The company must continue to expand and scale its information technology systems to support recent and expected future growth, which involves significant capital expenditures and operational risks [207]. - The company faces potential risks related to cybersecurity, system failures, and labor difficulties that could disrupt operations [98]. - Product returns are estimated based on historical trends, and any increase in actual returns could adversely affect financial results [99]. - Failure to successfully introduce new products or brands could lead to decreased revenue and excess inventory levels [82]. - The company anticipates the need to add additional distribution center capacity and lease new warehouse space to support business growth [97]. - The company faces risks associated with the use of open-source software, which could expose it to legal liabilities and technological risks if not managed properly [208]. - The company has implemented policies to mitigate risks associated with open-source software, but compliance cannot be guaranteed, which may lead to significant legal and operational challenges [209].

Exhibit 99.1 ODDITY TECH REPORTS RECORD 2024 FOURTH QUARTER AND FULL YEAR RESULTS NEW YORK, February 25, 2025 -- ODDITY Tech Ltd. (NASDAQ: ODD) today announced its financial results for the fourth quarter and full-year ended December 31, 2024. "2024 was a record-breaking year for ODDITY. We delivered outstanding results and exceeded our financial guidance every single quarter of the year, just as we have in the past 7 quarters since our IPO, while simultaneously making massive investments in our future," sa ...

Core Insights - ODDITY Tech Ltd. reported a record-breaking year in 2024, achieving net revenue growth of 27% and exceeding financial guidance every quarter since its IPO [2][4][5] - The company demonstrated strong performance in its direct-to-consumer model, contrasting with industry trends of weaker sales and excess inventory [2][5] - ODDITY's strategic focus includes investments in technology products and new brands to capture growth in the beauty and wellness sectors [2][5] Financial Performance - Full year net revenue reached $647 million, a 27% increase year-over-year [4][13] - Full year adjusted EBITDA was $150 million, reflecting a 40% year-over-year growth [4][13] - Fourth quarter net revenue was $124 million, also a 27% increase compared to the same quarter in 2023 [4][6] - The company achieved a gross margin of 72.4% for the full year, up from 70.4% in 2023 [13] - Net income for the full year was $101 million, compared to $59 million in 2023, with an adjusted net income of $121 million [4][13] Key Initiatives and Future Outlook - ODDITY plans to leverage its platform model for future growth through new brands and products [12][17] - The company is focused on developing Brand 3, a telehealth platform, and Brand 4 in the beauty and wellness market [12][17] - For 2025, ODDITY projects net revenue between $776 million and $785 million, with an adjusted EBITDA of $155 million to $158 million [14][17] Shareholder Returns and Financial Health - ODDITY repurchased 2.35 million shares for approximately $100 million in Q4 2024, totaling $147 million for the year [5][12] - As of December 31, 2024, the company had a strong balance sheet with $169 million in cash and no outstanding debt [5][12]

Company Overview - ODDITY Tech Ltd. is a consumer tech company focused on building and scaling digital-first brands to disrupt the offline-dominated beauty and wellness industries [3] - The company serves approximately 50 million users through its AI-driven online platform, utilizing data science to identify consumer needs and develop beauty and wellness products [3] - ODDITY owns brands such as IL MAKIAGE and SpoiledChild, with headquarters in New York City, an R&D center in Tel Aviv, Israel, and a biotechnology lab in Boston [3] Financial Results Announcement - ODDITY will release its fourth quarter and full year 2024 financial results after the market close on February 25, 2025 [1] - A conference call to discuss the financial results will take place on February 26, 2025, at 8:30 a.m. Eastern Time [1] Conference Call Details - To participate in the conference call, dial 1-877-407-9208 (US) or 1-201-493-6784 (international) and reference the call title: ODDITY Fourth Quarter and Full Year 2024 Earnings Call [2] - A webcast of the call will be available on the Investors section of ODDITY's website, with a recording accessible shortly after the call [2]

Core Insights - Oddity Tech (ODD) is positioned to continue its earnings-beat streak, having surpassed earnings estimates by an average of 33.92% in the last two quarters [1][3] Earnings Performance - For the most recent quarter, Oddity Tech reported earnings of $0.32 per share, exceeding the expected $0.22 per share, resulting in a surprise of 45.45% [2] - In the previous quarter, the company reported $0.82 per share against a consensus estimate of $0.67 per share, leading to a surprise of 22.39% [2] Earnings Estimates and Predictions - Estimates for Oddity Tech have been trending higher due to its history of earnings surprises, with a current Earnings ESP of +4%, indicating increased analyst optimism about its near-term earnings potential [3][6] - The combination of a positive Earnings ESP and a Zacks Rank of 3 (Hold) suggests a strong likelihood of another earnings beat [6] Statistical Insights - Research indicates that stocks with a positive Earnings ESP and a Zacks Rank of 3 or better have a nearly 70% chance of producing a positive surprise [4] - The Earnings ESP metric is derived from comparing the Most Accurate Estimate to the Zacks Consensus Estimate, reflecting the latest analyst revisions [5]

Core Insights - ODDITY Tech Ltd. has secured a new credit facility totaling $200 million, replacing its previous $100 million facility, aimed at enhancing financial flexibility for growth initiatives, acquisitions, share buybacks, and general corporate needs [1] - As of December 31, 2024, ODDITY holds over $165 million in cash, cash equivalents, and investments, with no funds drawn from the new credit facility [2] Company Overview - ODDITY is a consumer tech company focused on building and scaling digital-first brands to disrupt the traditional beauty and wellness industries, serving approximately 50 million users through its AI-driven online platform [2] - The company utilizes data science to identify consumer needs and develop beauty and wellness products, owning brands such as IL MAKIAGE and SpoiledChild [2] - ODDITY operates its business headquarters in New York City, with an R&D center in Tel Aviv, Israel, and a biotechnology lab in Boston [2]

Core Insights - ODDITY Tech Ltd. has acquired the tech intellectual property of Fionic, a fintech company specializing in advanced AI modeling for financial and consumer markets [1][2] - The acquisition aims to enhance ODDITY's existing AI capabilities and strengthen its position in AI-based algorithms for direct-to-consumer applications [2][3] - The integration of Fionic's elite AI research team is expected to accelerate advancements in predictive technology and improve consumer experience [3][4] Company Overview - ODDITY is a consumer tech company focused on disrupting the beauty and wellness industries through digital-first brands, serving approximately 50 million users with an AI-driven platform [5] - The company operates from New York City, with an R&D center in Tel Aviv and a biotechnology lab in Boston [5] Fionic Team Background - The Fionic team consists of elite AI researchers and data scientists with backgrounds in military intelligence, academia, and industry, bringing extensive experience in high-scale optimization and real-time AI deployment [4]

Core Insights - ODDITY has experienced a 6.7% increase in shares over the past three months, which is lower than the Zacks Internet-Software industry's 8.5% and the Zacks Computer and Technology sector's 8.4% returns [1] - The company is expanding its business through a strong direct-to-consumer model and personalized products, with brands like IL MAKIAGE and SpoiledChild showing strong double-digit growth [1] Group 1: Business Model and Growth - ODDITY has invested significantly in artificial intelligence, data science, machine learning, and computer vision, enhancing consumer engagement through online advertising [2] - The direct-to-consumer model allows ODDITY to gather direct data insights that are not available through traditional offline channels [2] - ODDITY's reliance on consumer data enables personalized product recommendations, positioning the company as a disruptor in the cosmetics industry [4] Group 2: Market Context - The cosmetics industry is traditionally slow-moving and primarily offline, with major players like Estée Lauder, Ulta Beauty, and Coty relying on physical retail outlets [3] - ODDITY is leveraging its consumer insights to expand sales in the U.S. market, achieving $414.1 million in U.S. sales in 2023, a 71.7% increase from 2022 [7] Group 3: Financial Performance - ODDITY's net revenues reached $508.7 million in 2023, up 56.7% from $324.5 million in 2022, with expectations for 2024 revenues in the range of $642-$644 million [8] - The Zacks Consensus Estimate for 2024 revenues is $643 million, indicating a year-over-year growth of 26.4% [8] Group 4: Future Plans - ODDITY plans to launch two new brands, including a telehealth platform, to further capitalize on the $600 billion global online cosmetics market [7]