Oddity Tech (ODD) Q2 2024 earnings summary

Executive summary

• Achieved record-breaking Q2 and first half 2024, with revenue up 28% to $404M, adjusted EBITDA of $110M, and $104M in free cash flow, surpassing full-year 2023 EBITDA.

• Q2 2024 results exceeded guidance, with strong revenue growth, margin expansion, and profitability improvements.

• Growth driven by both IL MAKIAGE and SpoiledChild brands, with IL MAKIAGE skin products now 25% of brand revenue.

• Continued investment in technology, data, and science-backed product innovation, including ODDITY LABS and new brand development.

• Online direct-to-consumer platform remains a key growth driver, with 94% of net revenue from owned websites.

Financial highlights

• Q2 net revenue grew 27% year-over-year to $193M, with average order value up 6%.

• Gross margin expanded 150–154 bps year-over-year to 72.2%, driven by supply chain and logistics efficiencies.

• Adjusted EBITDA for Q2 was $62M (32.3% margin, up 470 bps), and adjusted diluted EPS was $0.82.

• Free cash flow year-to-date reached $104M; cash, cash equivalents, and investments totaled $268M as of June 30, 2024.

• Net income for Q2 was $45M, up 52% year-over-year; adjusted net income was $51M, up 58%.

Outlook and guidance

• Raised 2024 full-year guidance: net revenue $633M–$640M (24–26% growth), gross margin 71%, adjusted EBITDA $142M–$146M, and adjusted EPS $1.71–$1.76.

• Q3 2024 net revenue expected to grow 22–24% year-over-year, with gross margin at 68% and adjusted EBITDA $21M–$23M.

• 2025 outlook: net revenue growth of 20% and adjusted EBITDA margin of 20%, with significant investments in new brands and ODDITY LABS.

• Outlook incorporates accelerated investments in growth, expected to impact adjusted EBITDA margin in H2 2024.