Kits Eyecare (KITS) investor relations material

Executive summary

• Q3 revenue reached a record $63.7M, up 21.6% YoY; gross profit grew 31.1% to $23.8M, with gross margin expanding 280 bps to 37.4%.

• Repeat revenue rose 27.8% to a record $41.8M, or 65.6% of revenue; the two-year active customer base grew 14.1% to 1.175M.

• Glasses revenue grew 59.3% to a record $11.3M; operating cash flow was $4.8M, with $30.6M cash, no debt and a 16th consecutive quarter of positive Adjusted EBITDA.

Financial highlights

• Q3 Adjusted EBITDA was $2.9M, or 4.6% of revenue, versus 5.5% a year earlier; nine-month Adjusted EBITDA was $10.0M versus $8.9M.

• Q3 net income was $672K, or $0.02/share, versus $1.9M, or $0.06/share; nine-month net income rose to $4.1M from $2.8M.

• Nine-month revenue increased 20.9% to $179.6M and gross profit rose to $69.5M from $53.3M.

• Operating cash flow was $4.8M, up 62.7% YoY and equal to 7.5% of revenue; YTD cash flow was $7.6M versus $5.0M.

Outlook and guidance

• Q4 revenue guidance is $64M–$66M, with Adjusted EBITDA margin of 4%–6%; FY2026 revenue outlook is $244M–$246M, or 20%–21% growth.

• The outlook assumes continued contact and glasses momentum, holiday demand and cohort returns; marketing is expected to trend toward 15%–16% of revenue as glasses reorder patterns normalize.