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Oddity Tech expects revenue growth up to 31%, according to preliminary third-quarter results

Oct 02, 2023 - cnbc.com
Oddity Tech, a newly public retailer that uses artificial intelligence to develop products, reported preliminary third-quarter results showing expected revenue growth of 29% to 31%, driven by repeat sales at its Il Makiage and Spoiled Child brands. The Tel Aviv-based company, which started trading on the Nasdaq in July, is also expecting a gross margin of 68.5% for the period, higher than its previous guidance of 67.5%. The company's sales have jumped by about 58% so far this year, with adjusted EBITDA of at least $89 million.

Oddity is working to disrupt the beauty and wellness industry by using AI to develop products. The company announced plans in April to acquire biotech startup Revela and open Boston-based Oddity Labs to create cosmetics that address problems like hair loss and wrinkles. The company expects Oddity Labs to have 10 products ready for market in 2024 and to drive 30% or more of the company's overall revenue over the next five years. Despite a 50% drop in Oddity's stock since its high of $56 per share, finance chief Lindsay Drucker Mann remains confident in the company's fundamentals.

Key takeaways:

  • Oddity Tech expects a revenue growth of 29% to 31% for the third quarter, driven by repeat sales at its Il Makiage and Spoiled Child brands.
  • The company is expecting a gross margin of 68.5% for the period, higher than its previous guidance of 67.5%, and an adjusted EBITDA margin of between 21% to 21.5%.
  • Oddity is using AI to develop products and disrupt the legacy beauty and wellness industry, with plans to acquire biotech startup Revela and open the Boston-based Oddity Labs.
  • The company expects Oddity Labs to have 10 products ready for market in 2024 and to drive 30% or more of the company's overall revenue over the next five years.
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