Tokyo Lifestyle (TKLF) investor relations material

Executive summary

• Achieved robust revenue growth of 77.6% year-over-year to $373.2 million, with double-digit increases across directly operated stores, franchise, and wholesale operations.

• Transformation into a diversified consumer lifestyle platform integrating retail, franchise, wholesale, and luxury goods businesses drove sustainable long-term value.

• Asset-light growth strategy advanced through franchise and wholesale expansion, especially in high-end and luxury goods, which became a significant growth driver.

• International expansion included new stores in Hong Kong and Australia, with overseas sales accounting for 47.1% of total revenue.

• Despite strong revenue growth, net income and EPS declined due to tax-related factors, not operational weakness.

Financial highlights

• Total revenue increased by 77.6% year-over-year to $373.2 million, up from $210.1 million.

• Directly operated store revenue rose 15.7% to $19.8 million; franchise and wholesale revenue grew 86.9% to $346.7 million.

• Gross profit increased 17.5% to $28.1 million, but gross margin declined to 7.5% from 11.4% due to a shift in revenue mix.

• Operating expenses rose 29.6% to $24.9 million, but improved as a percentage of revenue to 6.7% from 9.1%.

• Net income was $0.7 million, down from $6.6 million, mainly due to tax-related factors; basic and diluted EPS were $0.02, down from $0.16.

Outlook and guidance

• Plans to open 20 new directly operated stores in the U.S., Canada, Hong Kong, Australia, Thailand, and Taiwan over the next three years.

• Intends to add 23 new franchise stores in Japan, Southeast Asia, Macau, and Europe.

• New distribution center in Australia planned for 2026, with additional centers in other strategic markets.

• Management remains confident in sustainable, profitable growth through disciplined capital allocation, operational excellence, and strategic investment.

• Focus areas include continued customer acquisition, global brand recognition, product diversification, and deeper customer engagement.