Summary of Brilliant Earth Group (BRLT) FY Conference Call - August 27, 2025 Company Overview - **Company**: Brilliant Earth Group (BRLT) - **Industry**: Jewelry - **Market Size**: $350 billion global jewelry industry [5][10] Core Business Insights - **Mission**: To be the next generation fine jeweler, connecting with consumers through an authentic mission-driven brand [3][4] - **Target Audience**: Primarily consumers aged 25 to 44 with household incomes between $100,000 to $200,000 [6] - **Product Offerings**: Proprietary collections such as the Jane Goodall collection and the Soul collection, which are unique to Brilliant Earth [4][7] Business Model and Strategy - **Omnichannel Experience**: Seamless shopping experience across showrooms, website, and customer service [4][5] - **Data and Technology**: Capital-efficient model leveraging data and technology to adapt quickly to market trends [5][10] - **Supply Chain**: Globally diversified supply chain reducing dependence on any single geography [8][9] Financial Performance - **Growth Rate**: 16% CAGR from 2019 to 2024, with gross profit margin increasing from 42% in 2019 to 60% in 2024 [12][13] - **Q2 Performance**: - Net sales of $109 million, a 3% increase [14] - Average order value (AOV) of $2,074 [14] - 18% year-over-year growth in total orders and 11% in repeat orders [14] - Gross margin of 58.3% [14] - Adjusted EBITDA of $3.2 million, marking the sixteenth consecutive quarter of positive adjusted EBITDA [15] Inventory and Working Capital - **Inventory Turns**: Approximately four times, compared to the industry average of one to two times [11][23] - **Virtual Inventory Model**: Allows for a diverse product assortment while keeping balance sheet inventory low [23] Market Opportunities - **Fragmented Industry**: Two-thirds of the jewelry industry consists of smaller independent players, presenting an opportunity for market share capture [10] - **Fine Jewelry Growth**: Significant growth in fine jewelry bookings, up 38% year-over-year, indicating a strategic focus on this segment [16] Future Outlook - **Growth Targets**: Aiming for low teens year-over-year growth by 2027, supported by showroom expansion and brand awareness [29] - **Gross Margin Target**: Maintaining high 50s percentage gross margin through 2027 [30] - **Adjusted EBITDA Margin**: Targeting a double-digit margin by 2027 [30] Brand Highlights - **Celebrity Engagements**: Collaborations with celebrities like Beyoncé and Selena Gomez, enhancing brand visibility [21][22] - **Showroom Performance**: Strong double-digit metro uplift in sales post showroom openings, with 81% growth in orders from walk-in customers without appointments [25][27] Capital Structure - **Debt Management**: Paid off outstanding term loan balance of under $35 million, ending Q2 with $99 million in net cash [17][24] - **Share Buyback Program**: Executed share buybacks totaling $1 million [41] Conclusion - **Strategic Positioning**: Brilliant Earth is well-positioned to capture growth in the fragmented jewelry market through its unique brand, innovative product offerings, and efficient operational model [31]