While many in the retail sector prepare for diminished profits due to impending tariffs, Oddity Tech is charting its own course, raising its financial outlook following a robust quarterly performance, the company announced on Tuesday.
The firm, known for its brands Il Makiage and Spoiled Child, has upped its earnings and profit projections for fiscal year 2025, stating that it does not plan to implement price increases in response to the new tariffs.
In an interview with Finance Newso, Chief Financial Officer Lindsay Drucker Mann expressed confidence in the company’s ability to handle tariff-related challenges. “We have other mitigating initiatives, and we’ll have to see ultimately where tariffs shake out. There’s also discussions on tariff rates being reduced, so we’ll have to wait and see where the administration ultimately lands,” she said. “But what we know is that we have a lot of offsetting abilities, so we don’t expect to have to do anything drastic.”
According to a press release from Oddity, the company views the anticipated impact of tariffs as “manageable.”
“The 2025 outlook incorporates ODDITY’s current view of tariff and trade-related headwinds. While policy outcomes are in flux, based on the information ODDITY has today, these headwinds are expected to be manageable and largely offset by cost efficiencies,” the announcement stated. “ODDITY believes the impact from tariff and trade-related headwinds in 2026 will be similarly manageable.”
This optimistic projection helped lift Oddity’s shares by 15% during extended trading hours.
Examining the company’s fiscal first-quarter performance against Wall Street estimates gathered by LSEG, the following results were noted:
- Earnings per share: 69 cents adjusted compared to the anticipated 62 cents
- Revenue: $268 million against the forecasted $261 million
For the three-month period ending March 31, Oddity reported a net income of $37.8 million, equivalent to 63 cents per share, showing an increase from the previous year’s profit of $33 million, or 53 cents per share. After adjusting for stock-based compensation, the company’s earnings reached 69 cents per share.
Year-over-year, sales surged to $268 million, a notable 27% rise from $212 million last year.
For the ongoing fiscal year, Oddity now projects revenues between $790 million and $798 million, up from a prior estimate of $776 million to $785 million. This forecast exceeds the $784 million predicted by analysts, as per LSEG.
Additionally, Oddity anticipates adjusted earnings per share to range from $1.99 to $2.04, an increase from the earlier forecast of $1.94 to $1.98. This outlook is higher than the $1.93 per share that analysts had expected, according to LSEG.
Looking ahead, Oddity projects a gross margin of 71% for fiscal 2025, up from the previously estimated 70%, and an adjusted EBITDA between $157 million and $161 million, also an improvement from its previous forecast of $155 million to $158 million. However, the projections for gross margin and adjusted EBITDA were not directly comparable to existing estimates.
For the upcoming quarter, Oddity expects to achieve revenue between $235 million and $239 million, surpassing estimates of $232 million, according to LSEG. The company is also anticipating adjusted earnings in the range of 85 to 89 cents per share, outpacing estimates of 84 cents per share as per LSEG.
Oddity has emerged as a standout performer, not only among the struggling online brands but for the retail sector as a whole, which has faced significant turbulence since prior tariff announcements by the Trump administration, which have since been temporarily alleviated for many countries.
While numerous retailers are preparing to trim expenses to manage price hikes, Oddity boasts profit margins that exceed those of most competitors thanks to its direct-to-consumer model, allowing the company to focus on growth initiatives. The beauty segment, often perceived as resilient during economic downturns, further positions Oddity favorably as consumers tend to opt for affordable luxuries in tightening financial circumstances.
Year-to-date, Oddity’s stock has climbed 11%, outperforming the S&P 500, which has seen a 5.4% decline in the same period.
“From a profit and loss perspective, our exposure is limited. Moreover, our primary supplier base is in Europe, which minimizes our vulnerability to China’s steep 145% tariff on various exports to the U.S.,” Drucker Mann noted. “Thus, given the current tariff landscape, inflation levels are not expected to significantly affect us.”
