Core Insights - Interparfums, Inc. (IPAR) reported strong sales results for Q4 2025, driven by holiday demand, favorable foreign exchange effects, and momentum across core fragrance brands [1][2]. Sales Performance - For Q4 2025, Interparfums achieved a 7% increase in net sales, reaching $386 million, marking its best-ever fourth-quarter performance. Full-year net sales reached a record $1.489 billion, supported by currency tailwinds and growth across a broad portfolio of prestige and luxury fragrance brands [2]. - Europe-based net sales were $233 million in Q4, a 9% increase from the prior period, including 4% organic growth and a 4% benefit from foreign exchange. Full-year European sales rose 7% compared to 2024 on a reported basis and 4% organically [3]. Brand Contributions - Coach fragrances posted 5% growth in Q4 and 15% for the full year, supported by established lines and new launches [4]. - Lacoste fragrances saw strong gains of 23% in Q4 and 28% for the full year, with annual sales reaching $108 million [4]. - Montblanc fragrances recorded 22% growth in Q4, supported by the launch of the Montblanc Explorer Extreme line [5]. - Jimmy Choo fragrances grew 6% in 2025, driven by sustained demand in the U.S. market [5]. U.S. Sales Metrics - In Q4 2025, U.S.-based net sales reached $155 million, indicating a 4% year-over-year increase, supported by growth from GUESS and Donna Karan/DKNY [7]. - For the full year, U.S. sales totaled $482 million, a 6% decline from $511 million in 2024. Excluding the impact of the discontinued Dunhill license, the decline was 3% [7]. - GUESS and Donna Karan/DKNY returned to growth with 7% and 8% increases, respectively, in Q4 [8]. - Roberto Cavalli fragrances delivered significant gains, with sales rising 33% in both Q4 and the full year [9]. - MCM fragrances recorded growth of 40% in Q4 and 17% for the full year [9]. Strategic Initiatives - Interparfums' growth strategy focuses on brand elevation, consistent innovation, and disciplined portfolio management. The company is investing in marketing and advertising to enhance brand desirability while expanding digital and travel retail channels [11]. - Despite macroeconomic challenges, Interparfums ended 2025 with market share gains and record annual sales, entering 2026 with cautious optimism and plans for new product innovation [12].

Financial Data and Key Metrics Changes - For the first half of 2025, organic net sales rose by 3%, with net sales reported at $334 million for the second quarter, a slight decline from the same period in 2024 [5][21][22] - Gross margin expanded by 170 basis points to 66.2% for the first half and 150 basis points to 65% for the second quarter [22] - Operating income decreased by 9% to $59 million for the quarter, but increased by 1% to $134 million year-to-date [23][24] - Net income attributable to U.S.-based operations decreased by 26% to $18 million, largely due to lower sell-in [27] Business Line Data and Key Metrics Changes - European-based operations reported net sales growth of 7% in the second quarter and 6% on an organic basis for the first half [5][26] - U.S.-based operations saw a reported second quarter net sales decline of 20%, with organic sales down 14% [6][27] - SG&A expenses as a percentage of net sales increased to 48.5% for the second quarter compared to 45.6% in 2024 [22] Market Data and Key Metrics Changes - North America sales rose by 7%, while Western Europe sales increased by 3% [7] - Sales in Eastern Europe were up 14%, but Asia Pacific fragrances declined by 12% [8] - The Middle East and Africa region declined by 19%, reflecting the exit of the Dunhill license [8] Company Strategy and Development Direction - The company is focusing on product innovation, effective advertising, and promotional programs to maintain demand for fragrance products [4] - Plans to launch new fragrances and expand e-commerce presence, including flagship boutiques in Paris and an e-commerce platform [10][12] - The company is transitioning to third-party logistics to enhance operational efficiency [14] Management's Comments on Operating Environment and Future Outlook - Management noted that momentum eased in the second quarter, with challenges expected to continue into the second half of the year [4] - The company remains confident in achieving its full-year objectives, supported by a resilient fragrance category and tariff-driven pricing actions [28][29] - Management highlighted the importance of being agile to respond to potential surges in orders during the holiday season [39] Other Important Information - The company has been selected as the exclusive fragrance licensee for Laurentian, with plans to launch a women's fragrance in 2027 [11] - E-commerce channels are experiencing strong momentum, particularly on platforms like Amazon and TikTok [12][13] Q&A Session Summary Question: Can you discuss promotional levels and destocking trends? - Management indicated that destocking is difficult to assess but noted a slowdown in the market, with retailers being more prudent [34][35] - End demand was reported as good, with the market up 5% in the second quarter [36] Question: Are tariffs impacting retailer purchasing? - Management clarified that retailers are not subject to tariffs, but distributors are, leading to a more cautious purchasing approach [46] Question: Will the company continue to add new brands? - Management expressed a commitment to diversifying the portfolio and indicated capacity to take on more brands in the future [50] Question: What risks does retailer caution impose? - Management acknowledged the risk of revenue being pushed into Q4 due to uncertainty in purchasing [55] Question: Will smaller packaging be considered for TikTok? - Management confirmed that smaller packaging will be developed for certain brands on TikTok to meet price point demands [58] Question: What caused the increase in debt from Q1 to Q2? - Management explained that the increase was due to a loan taken out for asset purchases and additional office space [61]

Financial Performance - H1 2025 sales reached €447 million, a 5.8% increase at current exchange rates and 6.1% at constant exchange rates[16] - Q2 2025 sales were €211 million, showing a 0.7% increase at current exchange rates and 3.3% at constant exchange rates[11] - Coach fragrance sales increased by 24% to €106.3 million in H1 2025[35] - Lacoste fragrance sales increased significantly by 42% to €52.2 million in H1 2025[61] - Montblanc fragrance sales decreased by 10% to €92.3 million in H1 2025[48] Regional Performance - North America experienced a 15% increase in sales during H1 2025[97] - Asia saw an 11% decrease in sales during H1 2025[108] - Western Europe experienced an 11% increase in sales during H1 2025[119] Strategic Initiatives - The company acquired intellectual property rights to Off-White® and Annick Goutal brands[19] - A fragrance license agreement was signed with Maison Longchamp through December 31, 2036, with the first women's line launching in 2027[19, 22] - The Coach license agreement was extended through 2031[19] Tariff Impact - The United States announced tariffs, initially at 20% and later reduced to 10%, with a proposed increase to 30% as of August 1, 2025[8] - Consumer prices are expected to increase by 6% to 7% as of August 1, 2025, with a limited impact on the group's profitability[10] Outlook - The company adjusted its 2025 sales guidance to around €910 million due to a slower start to H2 2025 and less favorable euro-dollar exchange rate[157, 159]

Core Insights - Interparfums, Inc. (IPAR) reported first-quarter 2025 results with earnings of $1.32 per share, a 4% increase from $1.27 in the prior year, surpassing the Zacks Consensus Estimate of $1.13 per share [3] - Consolidated net sales reached $339 million, up 5% from $324 million year-over-year, with a 7% organic growth driven by strong performance in key fragrance brands [3][4] - The company reaffirmed its 2025 guidance, projecting net sales of $1.51 billion and earnings per share of $5.35, both reflecting a 4% year-over-year increase [13] Financial Performance - The gross margin improved to 63.7%, a 120-basis point increase from 62.5% in the prior year, attributed to a favorable brand and channel mix [6] - Operating income rose 10% to $75 million, with the operating margin expanding to 22.2%, up from 21% in the previous year [10] - Selling, general and administrative (SG&A) expenses were 41.6% of net sales, a slight increase of 10 basis points year-over-year, driven by higher advertising and promotional spending [7] Regional Sales Performance - North America and Western Europe saw sales increases of 14% and 1%, respectively, while Eastern Europe rebounded with a 46% rise in sales [4] - Sales in the Asia/Pacific region declined by 3%, Central and South America decreased by 10%, and the Middle East and Africa experienced a 16% decline, largely due to macroeconomic challenges and the exit from the Dunhill license [5] Inventory and Supply Chain Management - IPAR maintained steady inventory levels while accelerating raw material conversion to finished goods in anticipation of potential supply chain constraints [2] - The company is realigning its supply chain with key markets and exploring alternative sourcing outside China, planning selective price increases of 4% to 6% in August 2025 to offset recent tariffs [2] Financial Health - At the end of the quarter, IPAR had cash and cash equivalents of $96.6 million, long-term debt of $107.4 million, and total equity of $1,007.5 million [12] - The company announced a cash dividend of 80 cents per share, payable on June 30, 2025 [12]