ODDITY Tech Ltd. Class A ((ODD)) has held its Q2 earnings call. Read on for the main highlights of the call.
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ODDITY Tech Ltd. Class A recently held its earnings call, showcasing a predominantly positive sentiment driven by strong financial performance and brand expansion. The company reported significant revenue growth and successful international sales, although there were some concerns regarding a slight decline in average order value and gross margin guidance. Overall, the positive aspects of the earnings call outweighed the challenges noted.
Strong Revenue Growth
ODDITY Tech Ltd. reported a remarkable 26% increase in revenue, reaching $509 million in the first half of 2025. This growth surpassed financial targets for the ninth consecutive quarter since the company’s IPO, highlighting its consistent performance and market strength.
Successful Brand Expansion
The company announced plans to launch Brand 3 in Q4 2025 and Brand 4 in 2026, marking its entry into the medical-grade space with both OTC and prescription products. This expansion underscores ODDITY’s strategic focus on diversifying its product offerings and entering new markets.
International Sales Growth
ODDITY’s international sales grew by over 40% in the first half of 2025, demonstrating strong performance in key markets such as the UK and Australia. This growth highlights the company’s successful global strategy and its ability to capture market share internationally.
High Cash Flow Conversion
In the first half of 2025, ODDITY generated $99 million of free cash flow, converting more than 80% of its adjusted EBITDA into free cash. This high cash flow conversion rate reflects the company’s efficient financial management and operational strength.
Decline in Average Order Value
The earnings call revealed a slight decline of around 1% in average order value, attributed to mix changes, including faster growth in international markets and an increase in repeat sales. While this decline is a concern, it is mitigated by the overall growth in sales volume.
Gross Margin Concerns
ODDITY’s gross margin guidance for Q3 was slightly below expectations, influenced by seasonality and fixed COGS leverage. Despite this, the company remains focused on optimizing its cost structure to improve margins in the future.
Forward-Looking Guidance
In the second quarter of 2025, ODDITY demonstrated robust financial performance with a 25% year-over-year revenue growth, reaching $241 million and surpassing guidance. The adjusted EBITDA for the quarter was $70 million, exceeding projections, and the adjusted diluted earnings per share stood at $0.92. Looking ahead, ODDITY maintains a positive outlook for the remainder of the year, with full-year 2025 revenue expected to be between $799 million and $804 million, representing 23% to 24% growth. The company is also focused on future growth drivers, including the launch of Brand 3 and continued investments in ODDITY Labs and technology.
In conclusion, ODDITY Tech Ltd. Class A’s earnings call highlighted a strong financial performance with significant revenue growth and successful brand expansion. While there were some concerns regarding average order value and gross margin guidance, the overall sentiment was positive. The company’s strategic initiatives and forward-looking guidance suggest continued growth and expansion in the coming quarters.