Core Insights - ODDITY Tech Ltd. reported strong third quarter results for 2025, exceeding guidance in revenue, profit, and earnings per share, and is positioned for continued growth with new brand launches and investments in technology [2][3][4] Financial Performance - Third quarter net revenue reached $148 million, a 24% increase year-over-year from $119 million [4][6] - Gross profit for the third quarter was $106 million, up 27% from $83 million in the same period last year, with a gross margin of 71.6%, an increase of 170 basis points [4][6] - Adjusted EBITDA for the third quarter was $29 million, a 16% increase from $25 million year-over-year [4][6] - Net income for the third quarter was $18 million, consistent with the previous year, while adjusted net income rose to $25 million, a 26% increase from $20 million [4][6] Business Developments - The company successfully launched its new brand, METHODIQ, aimed at transforming the medical care system with advanced technology and precise treatments [2][5] - ODDITY is expanding its ODDITY LABS molecule discovery platform, indicating a focus on innovation and new product development [5] Financial Outlook - ODDITY raised its full-year 2025 financial outlook, projecting net revenue between $806 million and $809 million, representing a year-over-year growth of 24% to 25% [9][10] - The company anticipates a gross margin of approximately 72.5% and adjusted EBITDA between $161 million and $163 million for the full year [10] - For the fourth quarter of 2025, ODDITY expects net revenue between $149 million and $152 million, with a gross margin of approximately 69% [11]

Core Viewpoint - Oddity Tech Ltd. is identified as an oversold mid-cap stock with significant growth potential, despite a recent price target reduction by KeyBanc Capital Markets from $90 to $80, maintaining an Overweight rating [1][2]. Group 1: Company Overview - Oddity Tech Ltd. operates as an AI-driven beauty and wellness platform, known for brands like IL MAKIAGE and SpoiledChild, utilizing machine learning and proprietary data to personalize products in skincare, cosmetics, and wellness [4]. - The company went public in 2023 and has rapidly gained attention in the digital beauty market [4]. Group 2: Financial Performance and Projections - KeyBanc projects that Oddity can achieve revenue growth exceeding 20% and long-term EBITDA margins above 20%, indicating strong potential for both top-line and margin expansion [2]. - The recent adjustment in price target is attributed to broader market trends affecting mid-cap growth stocks rather than any decline in Oddity's fundamentals [3]. Group 3: Strategic Positioning - Oddity's vertically integrated direct-to-consumer (DTC) model, along with aggressive investments in research and development, positions the company uniquely within the beauty-tech sector [3].

Performance Overview - Baron International Growth Fund gained 16.91% during Q2 2025, outperforming its benchmark MSCI ACWI ex USA Index, which appreciated 12.03% [3] - The Fund has exceeded both the Benchmark and Proxy Benchmark on a one-year trailing basis [3] Annualized Performance - For the 1-year period ended June 30, 2025, the Fund's Institutional Shares returned 19.72%, compared to 17.72% for the MSCI ACWI ex USA Index [4] - Over the last 3 years, the Fund's Institutional Shares returned 10.34%, while the Benchmark returned 13.99% [4] Market Catalysts - The U.S. trade/tariff policy pivot and strong momentum towards a pro-growth tax reduction and fiscal spending bill were key drivers of global capital markets [5] - Despite tariff deferrals, there remains a risk of retaliation and a weaker U.S. dollar, which could shift capital flows towards non-dollar assets [5] Sector Performance - The Energy sector, particularly investments in Waga Energy SA, was the largest contributor to the Fund's relative performance [6] - Strong stock selection in Consumer Staples and Industrials sectors also contributed positively, while Health Care sector allocation detracted from performance [6] Country Contributions - Overweight positioning in Korea, particularly in shipbuilding, significantly contributed to relative performance [7] - Positive stock selection in France, India, and Israel also bolstered results, while China showed modest adverse stock selection effects [7] Top Contributors - HD Korea Shipbuilding & Offshore Engineering Co., Ltd. contributed 1.66% to returns, driven by improving profit margins and backlog growth [8] - Waga Energy SA and ODDITY Tech Ltd. also made significant contributions, with returns of 1.48% and 1.01% respectively [9] Top Detractors - Alibaba Group Holding Limited detracted 0.26% from performance due to results that fell short of investor expectations amid geopolitical uncertainty [12] - Full Truck Alliance Co. Ltd. and Argenx SE also detracted from performance due to revised earnings guidance and sales below expectations, respectively [13][14] Recent Activity - New investments were made in Centum Electronics Limited and XP Inc., focusing on global security and fintech disruption themes [22][24] - Increased exposure to existing positions, including AMG Critical Materials N.V. and SK hynix Inc., while exiting several positions to concentrate on higher conviction investments [26] Outlook - The Fund anticipates continued relative outperformance of non-U.S. equities, driven by changing U.S. priorities and fiscal expansion in the EU [30] - The focus remains on sectors and companies positioned to benefit from geopolitical shifts and technological advancements, particularly in Korea and India [32]

Core Insights - The company is positioned as the largest direct-to-consumer beauty platform globally, emphasizing its unique operational model that excludes sales to retailers and third parties [2] - The company anticipates approaching $1 billion in revenue for the upcoming year, indicating significant growth potential [2] - The company operates primarily through its technology platform, with over 95% of its business being online and direct-to-consumer [2] Company Overview - The company currently has two brands, with plans to expand to three [2] - The first brand, IL MAKIAGE, is highlighted as a key component of the company's portfolio [2] Industry Trends - The beauty industry has experienced an increase in online penetration over recent years, which has influenced the company's operational strategies [1]

Company Overview - ODDITY is positioned as the largest direct-to-consumer business in the global beauty industry, with over 95% of its revenue generated from its fully online technology platform, avoiding sales through third-party marketplaces, retailers, or wholesalers [2][3] - The company emphasizes a culture of innovation, characterized by rapid decision-making, a willingness to fail, and a commitment to challenging conventional norms [1][2] Brand Development - ODDITY currently operates two brands, with plans to expand to three. The first brand, IL MAKIAGE, was launched in the U.S. in 2018 and achieved over $500 million in revenue last year, establishing itself as one of the largest beauty brands in the United States [3]

Core Insights - ODDITY Tech Ltd. reported strong Q2 2025 results, with net sales and earnings exceeding estimates and showing year-over-year growth [1][3] - The company raised its full-year outlook, driven by robust top-line growth and strategic investments in innovation [2] Financial Performance - Adjusted EPS for Q2 was 92 cents, beating the estimate of 88 cents, and increased by 12.2% year-over-year [3] - Net sales reached $241.1 million, surpassing the estimate of $239 million, and grew by 25.1% from $192.8 million in the prior year [3] - Online DTC sales rose by 29.6% to $235.2 million, constituting 98% of total sales, up from 94% in the previous year [4] Margin and Cost Analysis - Gross profit was $174.4 million, a 25.3% increase from $139.1 million last year, with a gross margin of 72.3% [5] - SG&A expenses increased by 36.3% to $117.3 million, representing 48.6% of net sales, up 200 basis points year-over-year [5] - Operating income was $57.1 million, a 7.6% increase, while the operating margin declined to 23.7% [6] Strategic Developments - ODDITY's core brands, IL MAKIAGE and SpoiledChild, achieved double-digit online sales growth, supported by AI-driven personalization [10] - The company is on track to launch Brand 3 in Q4 2025, targeting the medical-grade dermatology segment, and Brand 4 is expected to launch in 2026 [11] - ODDITY raised $600 million through its first exchangeable note offering, indicating strong investor confidence [12] Future Guidance - For FY25, ODDITY expects net sales between $799 million and $804 million, reflecting 23-24% year-over-year growth [13] - Adjusted EBITDA is projected between $160 million and $162 million, with adjusted EPS expected between $2.06 and $2.09 [14] - For Q3 2025, net sales are anticipated to be between $144 million and $146 million, indicating year-over-year growth of 21-23% [14] Financial Health - As of June 30, 2025, ODDITY had cash and cash equivalents of $656.8 million, no long-term debt, and shareholders' equity of $351.2 million [9]

Core Insights - ODDITY Tech Ltd. reported strong financial results for Q2 2025, exceeding guidance across revenue, profit, and earnings per share, indicating robust business growth and profitability [2][4][6] - The company is expanding into new markets, particularly in healthcare with the upcoming launch of Brand 3, which focuses on medical-grade products [3][4] - ODDITY raised its full-year financial outlook for 2025, reflecting confidence in continued growth driven by a backlog of repeat orders [4][9] Financial Performance - Q2 2025 net revenue reached $241 million, a 25% increase year-over-year from $193 million in Q2 2024 [4][6] - Adjusted EBITDA for Q2 2025 was $70 million, up 12% from $62 million in Q2 2024, with an adjusted EBITDA margin of 28.8% [4][6] - Net income for Q2 2025 was $49 million, compared to $45 million in Q2 2024, with a net income margin of 20.4% [4][6] Financial Outlook - The updated full-year 2025 outlook includes net revenue between $799 million and $804 million, representing year-over-year growth of 23% to 24% [9][10] - For Q3 2025, ODDITY expects net revenue between $144 million and $146 million, with a gross margin of approximately 68% [11][9] - Adjusted diluted EPS for the full year is projected to be between $2.06 and $2.09, an increase from the previous outlook [9][10] Strategic Initiatives - The company is progressing towards the formal launch of Brand 3 in Q4 2025 and Brand 4 in 2026, indicating a focus on innovation and market expansion [5][4] - ODDITY is also developing its ODDITY LABS molecule discovery platform, which may enhance its product offerings in the future [5][4] - The company completed its first exchangeable note offering, upsized to $600 million, strengthening its cash position [5][4]

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 60 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 second quarter 2025 financial results after the market close on August 4, 2025 [1] - A conference call to discuss the financial results will take place on August 5, 2025, at 8:30 a.m. Eastern Time [1] Conference Call Details - Participants can join the conference call by dialing 1-800-717-1738 (US) or 1-646-307-1865 (international) [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 Viewpoint - Oddity Finance LLC, a subsidiary of ODDITY Tech Ltd, is pricing $525 million of 0% exchangeable senior notes due 2030, increasing from a previously announced offering size of $350 million [1][2] Group 1: Offering Details - The offering is expected to close on June 12, 2025, and will result in approximately $510.6 million in net proceeds after deducting initial purchasers' discounts [1] - The Issuer has granted initial purchasers an option to purchase an additional $75 million of notes within a 13-day period [1] - The notes will be senior, unsecured obligations and will not bear regular interest, maturing on June 15, 2030 [3] Group 2: Use of Proceeds - Net proceeds will be used for general corporate purposes, with no immediate plans for material acquisitions, but potential for strategic M&A in the future [2] - Approximately $55.3 million of the net proceeds will be allocated to capped call transactions [2] Group 3: Capped Call Transactions - Capped call transactions are designed to reduce potential dilution of ODDITY's Class A ordinary shares upon exchange of the notes [4] - The initial cap price for these transactions is set at $138.92 per share, representing a 100% premium over the last reported sale price [5] Group 4: Exchange and Redemption Terms - The notes are exchangeable at an initial rate of 10.8655 Class A ordinary shares per $1,000 principal amount, with an exchange price of approximately $92.03 per share, reflecting a 32.5% premium [9] - The Issuer may redeem the notes starting June 20, 2028, under specific conditions related to the stock price [10] Group 5: Company Overview - ODDITY is a consumer tech company focused on disrupting the beauty and wellness industries through digital-first brands, serving approximately 60 million users [16]

Group 1 - Oddity Finance LLC intends to offer $350 million of exchangeable senior notes due 2030, with an option for an additional $50 million, subject to market conditions [1][2] - The net proceeds from the offering will be used for general corporate purposes, including potential strategic M&A and capped call transactions [2][7] - The notes will be senior, unsecured obligations guaranteed by ODDITY and its subsidiary, with no regular interest and a maturity date of June 15, 2030 [3][9] Group 2 - Capped call transactions are expected to reduce potential dilution of ODDITY's Class A ordinary shares upon exchange of the notes [4][5] - The notes will be exchangeable for cash or ODDITY's Class A ordinary shares, with specific conditions for exchange prior to March 15, 2030 [9][10] - The issuer may redeem the notes starting June 20, 2028, under certain conditions related to the stock price [10][11] Group 3 - As of March 31, 2025, ODDITY had $257 million in cash and an undrawn $200 million credit line, indicating strong liquidity [7] - ODDITY is a consumer tech company focused on disrupting the beauty and wellness industries through digital-first brands and AI-driven solutions [16]