a.k.a. Brands (AKA) - 2025 Q4 - Annual Results

Financial Performance - Net sales for fiscal 2025 increased by 4.4% to $600 million, with a 7% growth in the U.S., and a 25% increase on a two-year stack[4]. - Fourth quarter net sales rose 3.1% to $164 million, compared to $159 million in Q4 2024, with a 5.3% increase in the U.S.[6]. - The company reported a net loss of $31.4 million, or $(2.93) per share, for the full year 2025, compared to a net loss of $26 million, or $(2.46) per share, in 2024[6]. - The company reported a net loss of $14,498,000 for the three months ended December 31, 2025, compared to a net loss of $9,357,000 in the same period of 2024, reflecting an increase in the net loss margin from (5.9)% to (8.8)%[26]. - The net loss for the year ended December 31, 2025, was $31,434 million, up from a net loss of $25,990 million in 2024[36]. - The net loss margin for the three months ended December 31, 2025, was (8.8)%, compared to (5.9)% in 2024[36]. EBITDA and Margins - Adjusted EBITDA for fiscal 2025 was $19.7 million, or 3.3% of net sales, down from $23.3 million, or 4.1% of net sales in 2024[6]. - Adjusted EBITDA for the year ended December 31, 2025, was $19,721,000, down from $23,309,000 in 2024, with an adjusted EBITDA margin of 3.3% compared to 4.1%[26]. - Adjusted EBITDA for the three months ended December 31, 2025, was $2,512 million, compared to $6,216 million for the same period in 2024, indicating a decline[36]. - Adjusted EBITDA margin for the three months ended December 31, 2025, was 1.5%, down from 3.9% in the same period of 2024[36]. - The company expects Adjusted EBITDA margin to increase over the long term as it scales its business[34]. - Adjusted EBITDA is calculated as net income adjusted for various expenses, providing a clearer view of operational performance[35]. Sales and Customer Metrics - Active customers increased by 2.7% year-over-year, reaching 4.18 million for both the three months and year ended December 31, 2025[27]. - The company experienced a 6.9% increase in U.S. sales for the year ended December 31, 2025, totaling $394,288,000, up from $368,799,000 in 2024[27]. - The average order value (AOV) decreased by 2.5% year-over-year to $77 for the year ended December 31, 2025[27]. Operational Efficiency and Expansion - The company opened eight new Princess Polly stores in the U.S. and plans to continue expanding its retail footprint[4]. - The company is embedding AI-driven tools to enhance operational efficiency and support margin expansion[4]. Cash Flow and Inventory - Cash flow from operations for the year ended December 31, 2025, was $16.4 million, significantly up from $0.7 million in 2024[11]. - Inventory at the end of Q4 2025 totaled $86.2 million, down from $95.8 million at the end of Q4 2024[11]. - Cash and cash equivalents decreased to $20,273,000 as of December 31, 2025, down from $24,192,000 in 2024[22]. Liabilities and Expenses - Total liabilities increased to $299,611,000 as of December 31, 2025, compared to $267,570,000 in 2024[22]. - Depreciation and amortization expense for the year ended December 31, 2025, was $17,758 million, compared to $17,597 million in 2024[36]. - Total other expense, net for the three months ended December 31, 2025, was $2,524 million, slightly down from $2,631 million in 2024[36]. - Equity-based compensation expense for the three months ended December 31, 2025, was $1,252 million, down from $1,993 million in 2024[36]. - Distribution center relocation costs for the three months ended December 31, 2025, were $3,045 million, compared to $1,435 million in 2024[36].