Core Viewpoint - Four Chinese concept stocks have been suspended from trading by the U.S. Securities and Exchange Commission (SEC) due to allegations of stock price manipulation shortly after their IPOs [1] Group 1: QMMM Holdings (QMMM.US) - The SEC suspended trading of QMMM Holdings Ltd. after its stock price surged over 100 times in less than a week [2] - The company announced plans to establish a "diversified cryptocurrency vault" with an initial scale of $100 million, targeting Bitcoin, Ethereum, and Solana [2] - Following the announcement, the stock price skyrocketed, but the SEC's intervention indicates potential market manipulation [2] Group 2: Smart Digital Group Ltd. (SDM.US) - The SEC also suspended trading of Smart Digital Group Ltd. for similar reasons related to stock price manipulation [2] - The company had announced plans to create a "diversified cryptocurrency asset pool" focused on Bitcoin and Ethereum, but its stock price has since declined [2] Group 3: Etoiles Capital (EFTY.US) - The SEC decided to suspend trading of Etoiles Capital Group Co., Ltd. due to signs of market manipulation through social media recommendations [5] - The company went public on August 8 with an IPO price of $4 per share, raising $5.6 million, and its stock price has risen to $15, giving it a market cap of $300 million [5] Group 4: Pitanium Limited (PTNM.US) - The SEC suspended trading of Pitanium Limited based on similar concerns of market manipulation via social media [7] - The company completed its IPO on May 30 at $4 per share, raising $7 million, and its stock price has increased to $10.39, resulting in a market cap of $239 million [7] Group 5: Platinum Analytics (PLTS.US) - The SEC suspended trading of Platinum Analytics due to indications of market manipulation through social media recommendations [11] - The company went public on September 19 with an IPO price of $4, raising $8 million, and its stock price has risen to $17.5, leading to a market cap of $316 million [11]

Leadership Change - Bath & Body Works has appointed Daniel Heaf, former chief strategy and transformation officer at Nike, as its new CEO effective immediately [1][5] - Heaf's appointment was unanimously approved by the company's board, and he is expected to join the board after the upcoming shareholder meeting in June [5] Previous CEO - Gina Boswell, who served as CEO since November 2022, is stepping down, and her contributions to stabilizing the business post-COVID were acknowledged by the board [3][4] - Boswell was temporarily absent for surgery in March, which may have influenced the leadership transition [4] Company Performance - Bath & Body Works reported preliminary first-quarter net sales of $1.42 billion, reflecting a year-over-year increase of 3% [11] - The company anticipates annual net sales growth of 1-3% and expects earnings per diluted share to be in the range of $3.25 to $3.60 [9] Market Position - As of Monday afternoon, Bath & Body Works had a market capitalization of $7.19 billion [12] - The company operates nearly 1,900 locations in the U.S. and Canada, along with over 500 franchised stores internationally [12] Strategic Outlook - Heaf is recognized for his consumer-centric mindset and experience in driving innovation across global consumer and retail companies [8] - The leadership change comes amid challenges related to uncertain discretionary spending, which has impacted the company's sales and profit forecasts [8]

Financial Data and Key Metrics Changes - The company reported net revenue of $65.4 million, a decline of 4.1% year-over-year [10] - Adjusted gross profit margin remained strong at 76.4%, an increase of 10 basis points year-over-year [10] - Adjusted EBITDA was $4.4 million, reflecting a margin of 6.7% [10] Business Line Data and Key Metrics Changes - Milk Makeup experienced a revenue decline of 15.1%, but domestic performance was solid, driven by the successful launch of Hydro Grip Gel Skin Tint [11][12] - Obagi Medical achieved net revenue of $36.2 million, increasing 7.1% from the previous year, despite out-of-stock issues [13] Market Data and Key Metrics Changes - The company noted strong growth in attractive channels, including professional, specialty, retail, and online, with expectations for continued momentum [9] - Milk Makeup's U.S. retail sales showed high single-digit growth, particularly due to the launch at Ulta [12][16] Company Strategy and Development Direction - The company is focused on strengthening its supply chain and achieving cost efficiency while enhancing flexibility to meet demand [7][19] - The strategic growth initiatives include expanding Milk Makeup and Obagi Medical brands, driving innovation, and increasing community engagement [5][6] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future growth, citing key drivers such as breakthrough innovation, digital channel expansion, and improved product availability [19][20] - The company remains cautious about the macroeconomic environment, anticipating some pressure from softer consumer sentiment and spending [21] Other Important Information - The company has a cash position of $10.8 million and an additional $22.5 million available on its revolving credit facility [23] - Net debt increased to $172.1 million, primarily due to refinancing costs [24] Q&A Session Summary Question: Can you expand on the supply chain restructuring for Obagi? - Management indicated that the supply chain needs to be more responsive and flexible, with ongoing efforts to streamline operations [42][44] Question: What is driving the slowdown in the physician channel? - Management clarified that the slowdown is not due to fewer visits but rather a lack of tailwinds from the previous year's Amazon business conversion [47][49] Question: Can you provide insights on sell-through trends for Obagi and Milk? - Management noted a significant difference between sell-in and sell-through for Milk, with high single-digit retail sales growth, while Obagi's model is based on sell-through [52][54] Question: What is the expected impact of tariffs on costs? - Management stated that even with potential tariff increases, the impact is manageable due to low exposure to China, with possible low to mid-single-digit price increases being evaluated [64][66] Question: How is SG&A expected to change with sales growth? - Management expects SG&A to grow in absolute terms but with substantial operational leverage, keeping it flattish as a percentage of sales [68][70] Question: What are the marketing investment strategies moving forward? - Management plans to increase investments in top-of-funnel advertising for Milk and expand consumer outreach for Obagi, focusing on long-term competitive advantage [74][75]