Core Insights - Oddity Tech Ltd. (ODD) reported fourth-quarter 2025 results with revenues and earnings exceeding Zacks Consensus Estimates, showing year-over-year revenue growth while earnings remained flat compared to the previous year [1][4] Financial Performance - ODD's quarterly earnings were $0.20 per share, surpassing the Zacks Consensus Estimate of $0.14 per share and exceeding the guided range of $0.11 to $0.13 [4] - The company's net revenues reached $152.7 million, a 23.5% increase from $123.6 million year-over-year, and also beat the Zacks Consensus Estimate of $151 million [5] - Gross profit increased by 20% year-over-year to $108 million, with a gross margin of 70.5%, down 220 basis points from 72.7% [6] - Selling, general and administrative expenses rose to $106 million, a 23.4% increase year-over-year [7] - Adjusted EBITDA declined 17.4% year-over-year to $12.5 million, although it was above the expected range of $10 million to $12 million [7] Cost and Margin Analysis - The adjusted EBITDA margin fell to 8.2%, down 410 basis points year-over-year, primarily due to planned investments for future growth [8] - The company is managing costs actively to offset EBITDA pressure while continuing to invest in growth initiatives [16] Customer Acquisition and Future Outlook - A significant increase in customer acquisition costs, driven by algorithm changes at a major advertising partner, has led to concerns about profitability and revenue decline, with expectations of a 30% sales drop in Q1 2026 [2][11] - The company has withdrawn its full-year guidance for 2026 due to uncertainty regarding the normalization of customer acquisition costs [15] - ODD anticipates that the first half of 2026 will experience the most significant financial impact, with hopes for improvement in the second half [15] Financial Health - ODD ended 2025 with a strong liquidity position, holding $776 million in cash and investments, bolstered by a successful exchangeable note offering and free cash generation of $84 million [9] - The company amended its credit facilities in January 2026 to expand borrowing capacity to $350 million, which remains undrawn [10] Shareholder Returns - ODD plans to return cash to shareholders through stock repurchases, with $103 million remaining under its $150 million repurchase authorization [12]

Financial Data and Key Metrics Changes - ODDITY reported a record revenue of $810 million for 2025, representing a 25% increase year-over-year [4][21] - Adjusted EBITDA reached $163 million, with an adjusted EBITDA margin of 20.2%, consistent with long-term targets [21] - The company experienced a gross margin of 72.7%, which expanded by 30 basis points year-over-year [21] - Advertising costs increased approximately 50% year-over-year, impacting profitability [21] Business Line Data and Key Metrics Changes - IL MAKIAGE generated approximately $560 million in revenue, with low double-digit growth, and IL MAKIAGE SKIN accounted for about 40% of brand revenue [6][7] - SpoiledChild achieved revenue of approximately $250 million, marking strong growth for a brand launched only four years ago [7] - METHODIQ, the newly launched brand, is positioned in the medical-grade space and is off to a promising start [8] Market Data and Key Metrics Changes - ODDITY's international revenue grew by 42%, representing 17.5% of overall net revenue for 2025 [7] - The company noted that many competitors generate over 65% of their net sales from international markets, indicating a potential growth opportunity for ODDITY [7] Company Strategy and Development Direction - ODDITY is focused on leveraging its platform, brand, and technology to drive growth in the beauty and wellness categories [5] - The company is committed to investing in ODDITY Labs and new product development, maintaining a long-term growth strategy despite short-term challenges [9][25] - The management emphasized that the current user acquisition cost issues are technical and not indicative of a structural problem in the business model [18] Management's Comments on Operating Environment and Future Outlook - Management acknowledged unprecedented increases in user acquisition costs due to algorithm changes from a major advertising partner, impacting new user acquisition efficiency [12][13] - Despite these challenges, management remains confident in the company's ability to return to growth and does not plan to change its long-term strategy [17][25] - The company expects a negative impact on 2026 financial results, particularly in the first half, but anticipates normalization in the second half of the year [23][24] Other Important Information - ODDITY ended the year with a strong liquidity position, holding $776 million in cash and cash equivalents [22] - The company plans to opportunistically return cash to shareholders through stock buybacks [22] Q&A Session Summary Question: Inquiry about LTV change and its relation to Google's Andromeda - Management observed the issue starting in the second half of 2025, worsening into 2026, and is working on solutions while maintaining the try before you buy model [28][29][30] Question: Concerns about guidance and user acquisition shifts - Management confirmed no change in strategy, emphasizing confidence in online growth and the temporary nature of current challenges [34][35][36] Question: Discussion on advertising spend strategy post-normalization - Management intends to balance advertising spend to maintain algorithm signals while avoiding overspending at high CPA levels [41][43] Question: Clarification on changes within the acquisition funnel - Management noted that the dislocation affects multiple brands and is working on adjustments to improve performance [51][52][54] Question: Impact of dislocation on METHODIQ launch - The launch of METHODIQ is expected to continue growing without significant negative effects due to its smaller scale compared to other brands [68]

Core Insights - ODDITY Tech Ltd. reported strong financial results for Q4 2025, exceeding guidance in revenue, profit, and earnings per share for the 11th consecutive quarter since going public [2][3] - The company experienced a dislocation in user acquisition costs due to changes in algorithms from its largest advertising partner, which led to increased costs [2][3] - Despite challenges, ODDITY remains focused on long-term growth and has identified solutions to address the acquisition cost issues [2][3] Financial Performance - Q4 2025 net revenue reached $153 million, a 24% increase year-over-year, with adjusted EBITDA of $13 million [5][7] - Full year 2025 net revenue was $810 million, up 25% year-over-year, with adjusted EBITDA of $163 million [5][11] - The company reported a Q4 net income of $6 million, compared to $5 million in Q4 2024, and a full year net income of $110.7 million, up from $101.5 million in 2024 [7][11] Shareholder Returns - ODDITY plans to return cash to shareholders through a share buyback program, with $103 million remaining from a $150 million authorization [4] Strategic Initiatives - The successful launch of the new brand METHODIQ during Q4 2025 is seen as a key growth driver [2][6] - The company continues to invest in its ODDITY LABS molecule discovery platform, indicating a commitment to innovation and future growth [6] Cash Position - ODDITY holds a strong cash position with $776 million in cash, cash equivalents, and investments as of December 31, 2025 [6][39] - The company amended its credit agreements to secure credit facilities totaling $350 million in January 2026 [6]

Core Insights - ODDITY Tech Ltd. will release its fourth quarter and full year 2025 financial results on February 25, 2026, before market opening, followed by a conference call at 8:30 a.m. Eastern Time [1] Company Overview - ODDITY is a consumer tech company focused on building and scaling digital-first brands to disrupt the traditional 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, SpoiledChild, and METHODIQ, with headquarters in New York City, an R&D center in Tel Aviv, Israel, and a biotechnology lab in Boston [3]

Core Viewpoint - ODDITY Tech (NASDAQ:ODD) is recognized as a promising mid-cap consumer staples stock with a significant upside potential, supported by positive analyst ratings and strong product performance [1][3]. Group 1: Analyst Ratings and Price Target - Evercore ISI analyst Mark Mahaney has reaffirmed an outperform rating for ODDITY Tech, projecting a price target of $80, indicating an upside of nearly 126% [1][3]. - Citizens also assigned an outperform rating to ODDITY Tech, estimating a similar 126% upside based on the same price target of $80 [3]. Group 2: Product Performance and Revenue Potential - The latest skin care offering, METHODIQ, has received a promising market response, with expectations of generating incremental revenues between $80 million and $200 million by 2028 [2]. - METHODIQ has outperformed the SpoiledChild product at a comparable stage, suggesting strong growth and cross-selling opportunities in the future [4]. Group 3: Financial Performance - ODDITY Tech has demonstrated strong fundamental performance, achieving EBITDA margins of nearly 20% for nine consecutive quarters and over 20% topline growth for ten consecutive quarters [3]. Group 4: Business Model and Innovation - ODDITY Tech operates as a consumer technology business that disrupts the beauty and wellness industries through an AI-enabled platform, utilizing data science, machine learning, and biotechnology to develop digital-first brands like SpoiledChild and IL MAKIAGE [5].

Group 1: Company Performance - Oddity Tech Ltd. reported a 24% year-over-year revenue increase to $148 million in Q3 2025, with a simultaneous 24% rise in adjusted diluted EPS [2] - The company's growth was driven by a 40% year-over-year surge in international revenue, particularly in established markets like the UK and Australia [2] - Oddity is testing new markets in France, Italy, and Spain as part of its international expansion strategy [2] Group 2: Financial Guidance - Oddity raised its full-year 2025 revenue guidance, now forecasting total revenue between $806 million and $809 million, representing 24% to 25% growth [3] - The adjusted diluted EPS is projected to be in the range of $2.10 to $2.12 for the full year [3] Group 3: Strategic Developments - A major highlight of the quarter was the launch of METHODIQ, a new dermatology-focused medical care brand, expected to scale faster than the previous successful launch of SpoiledChild [3] - Although METHODIQ is anticipated to initially carry lower gross margins due to third-party physician network costs, management remains optimistic about its growth potential [3] Group 4: Analyst Ratings - JPMorgan analyst Cory Carpenter lowered the price target on Oddity to $59 from $67 while maintaining an Overweight rating on the shares [1] - The firm updated its investment ratings and price targets for companies within the small- and mid-cap internet and video game sectors as part of its 2026 market forecast [1]

Financial Data and Key Metrics Changes - ODDITY reported a 24% year-over-year revenue growth in Q3, reaching $148 million, exceeding guidance of 21% to 23% growth [16][19] - Adjusted diluted earnings per share increased to $0.40, surpassing guidance of $0.33 to $0.36 [18] - Gross margins expanded to 71.6%, up 170 basis points from the previous year, exceeding guidance of 68% [17] Business Line Data and Key Metrics Changes - Il Makiage experienced double-digit online revenue growth, with a target of $1 billion revenue by 2028 [11] - SpoiledChild is expected to generate $225 million in revenue for 2025, showing strong performance [12] - METHODIQ, the new brand, aims to launch 28 products addressing various skin conditions, with a focus on dermatology [8][9] Market Data and Key Metrics Changes - International revenue increased approximately 40% year-over-year in the first nine months of 2025, with significant growth in existing markets like the U.K. and Australia [11][24] - The U.S. still accounts for 83% of total revenue, indicating room for international expansion [23] Company Strategy and Development Direction - ODDITY is focused on expanding its international presence while responsibly managing growth across brands and geographies [23] - The company aims to leverage technology and innovation, particularly through ODDITY Labs, to enhance product offerings and consumer experience [14][52] - METHODIQ is positioned to transform the medical care system by providing high-efficacy treatments without traditional barriers [6][7] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges in the industry but emphasized strong financial performance and growth potential [5][16] - The company raised its full-year guidance, expecting net revenue between $806 million and $809 million for 2025, representing 24% to 25% growth [19] - Management remains optimistic about the consumer environment, citing strong repeat purchase rates as a buffer against acquisition cost increases [40] Other Important Information - ODDITY plans to launch a major media campaign for METHODIQ, including a significant TikTok activation [10][89] - The company has a strong cash position with $793 million in cash and equivalents, plus $200 million available on undrawn credit facilities [19][60] Q&A Session Summary Question: Can you unpack the 40% year-to-date growth in international markets? - Management noted that 83% of revenue still comes from the U.S., with international growth primarily from existing markets like Canada and the U.K. [23][24] Question: How does METHODIQ plan to attract new customers? - METHODIQ is expected to draw customers from existing brands while also focusing on user acquisition [27] Question: What is the growth outlook for Il Makiage and SpoiledChild? - Management aims for sustained 20% growth across brands, with Il Makiage targeting $1 billion by 2028 [75] Question: How is the company addressing higher acquisition costs? - Management highlighted strong repeat purchase rates as a key factor in offsetting higher acquisition costs [40] Question: What is the financial profile of METHODIQ? - METHODIQ is expected to have a similar long-term growth framework as Il Makiage and SpoiledChild, with a focus on repeat business [50] Question: How will the company leverage its physician network for METHODIQ? - The company is currently using third-party networks for physicians and plans to integrate technology to enhance treatment outcomes [67]

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]