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ODDITY Tech Reports Record Third Quarter Results, Exceeds Guidance and Raises Full Year Revenue and Profit Outlook

NEW YORK, Nov. 07, 2023 (GLOBE NEWSWIRE) -- ODDITY Tech Ltd. (NASDAQ: ODD) today announced its financial results for the third quarter and nine months ended September 30, 2023.

“Our third quarter is our best third quarter ever, exceeding our guidance. We delivered net revenue growth of 60% and adjusted EBITDA of $91 million in the first nine months of 2023, and are increasing our sales and profit outlook for the full year,” said Oran Holtzman, ODDITY co-founder and CEO. “We continue to deliver excellent growth and profitability for IL MAKIAGE and SpoiledChild, while building powerful engines to scale our business and expand our lead in 2024 and beyond. Our business continues to fire on all cylinders and is the strongest it has ever been. Our large investments in technology and data capabilities over the past five years are enabling us to continue to grow fast without damaging our high margins and strong profitability.

ODDITY achieved a number of objectives during the third quarter, supporting strong financial performance today and positioning the business for the future. These include:

  • Better-than-expected financial results for the third quarter and an improved outlook for the full year 2023.
  • Excellent, profitable growth at both IL MAKIAGE and SpoiledChild brands across markets and products.
  • Progress in the ODDITY LABS molecule discovery platform, powered by the Revela integration, including tripling the lab headcount with majority PhD hires.
  • Strong financial position including $164 million of cash, restricted cash, and short-term deposits, with no debt on the balance sheet. This cash position was supported by $78 million of free-cash flow year-to-date.

“We are pleased with our third quarter results, which exceeded the initial guidance we issued in August, as well as the preliminary results we reported in October across sales, gross profit, and adjusted EBITDA. The upside relative to our guidance was driven in part by stronger repeat sales relative to our previous outlook. We reinvested a portion of this revenue upside against future growth initiatives including new brands and markets, which is consistent with our commitment to long-term reinvestment,” said Lindsay Drucker Mann, ODDITY Global CFO. “Our superior financial results in the third quarter reflect the strength of our model, and our significant runway for profitable growth ahead. The third quarter upside, combined with strong momentum in the fourth quarter, leads us to increase our full year outlook across all key financial metrics.”

Third Quarter Fiscal 2023 Financial Highlights¹:

Results for the third quarter ended September 30, 2023 are presented below in comparison to the same period in the prior year:

  • Net revenue was $94 million compared to $69 million in the third quarter of 2022, representing a 37% year-over-year increase.
  • Gross profit was $66 million compared to $47 million in the third quarter of 2022, representing a 41% year-over-year increase. Gross margin was70.3%, expanding 217 bps versus gross margin of 68.1% in the third quarter of 2022.
  • Net income was $3.8 million compared to $2.8 million in the third quarter of 2022. Net income margin was 4.1% compared to 4.0% in the third quarter of 2022.
  • Adjusted net income was $13.0 million compared to $3.9 million in the third quarter of 2022, representing a 231% year-over-year increase. Adjusted net income margin was 13.8% compared to 5.7% in the third quarter of 2022.
  • Adjusted EBITDA was $21 million compared to $6.4 million in the third quarter of 2022, representing a 227% increase. Adjusted EBITDA margin was 22.0%, expanding 1280 bps versus adjusted EBITDA margin of 9.2% in the third quarter of 2022.
  • The weighted average number of outstanding shares used in computing our basic earnings per share (“EPS”) was 56.4 million and 53.3 million for the third quarter of 2023 and 2022, respectively. The weighted average number of outstanding shares used in computing our diluted EPS and Adjusted Diluted EPS was 61.4 million and 56.2 million for the third quarter of 2023 and 2022, respectively.
  • Diluted earnings per share (“EPS”) were $0.06 compared to $0.05 in the third quarter of 2022. Adjusted Diluted EPS were $0.21 compared to $0.07 in the third quarter of 2022.
  • Cash and cash equivalents, restricted cash, and short-term deposits were $164million, with no outstanding debt as of September 30, 2023.

The table below sets forth our actual results for the three months ended September 30, 2023 and the low and high end of our initial guidance range regarding our results for the third quarter of 2023 as issued August 9, 2023 (“Initial Guidance”).

 Three months ended September 30, 2023
 ActualInitial GuidanceInitial Guidance
 ResultsLow EndHigh End
Net Revenue Growth37.00%18.00%23.00%
Gross Margin70.30%67.50%67.50%
Adjusted EBITDA Margin22.00%20.00%21.50%
Adjusted Diluted EPS$0.21$0.13$0.15

Financial Outlook

Based on the strong third quarter results, ODDITY is raising its outlook for 2023 to reflect higher revenue, profit margins, and earnings than previously expected.

ODDITY is providing the following guidance for the full year ending December 31, 2023:

  • Net revenue between $493 million and $497 million, above our prior expectation for $475-480 million, and now representing year-over-year growth between 52% and 53% as compared to our prior expectation of between 46% and 48%.
  • Gross margins of approximately 70.0%, above our prior expectation of 69.5 %.
  • Adjusted EBITDA between $104 million and $105 million, above our prior expectation of between $96 million and $101 million.
  • Adjusted EBITDA margin of21.0%, at the top end of our prior expectation of 20.0-21.0%
  • Adjusted Diluted EPS between $1.21 and $1.23, above our prior expectation of $1.11-1.17. This assumes a tax rate of approximately 25.5% and average fully diluted shares of approximately 60 million.
 Current FY2023 OutlookPrior FY2023 Outlook
Net Revenue$493-497 million$475-480 million
Gross Margin70.00%69.50%
Adjusted EBITDA$104-105 million$96-101 million
Adjusted Diluted EPS$1.21-1.23$1.11-1.17

ODDITY is providing the following guidance for the fourth quarter ending December 31, 2023:

  • Net revenue between $82 million and $85 million, representing year-over-year growth between 22-26 %.
  • Gross margin of approximately 66.0%.
  • Adjusted EBITDA between $13 and $14 million, representing Adjusted EBITDA margin of between 15.5-16.5%.
  • Adjusted Diluted EPS between $0.10 and $0.12. This assumes a tax rate of approximately 35% and average fully diluted shares of approximately 63 million.
  • Stock-based compensation expense is expected to be approximately $8 million in the fourth quarter of 2023.
 Current 4Q 2023 Outlook
Net Revenue$82-85 million
Gross Margin66.00%
Adjusted EBITDA$13-14 million
Adjusted Diluted EPS$0.10-0.12

Adjusted EBITDA, Adjusted EBITDA margin, Adjusted net income, Adjusted net income margin and Adjusted Diluted EPS are non-GAAP financial measures. Please see the sections titled “Non GAAP Financial Measures” and “Reconciliations of GAAP to Non-GAAP Measures” below for more information regarding ODDITY’s use of non-GAAP financial measures and reconciliations to the most directly comparable GAAP measures. ODDITY has not provided a quantitative reconciliation of its Adjusted EBITDA and Adjusted Diluted EPS outlook to the corresponding net income and diluted EPS GAAP measures, because the quantification of certain items included in the calculation of GAAP net income and GAAP diluted EPS cannot be calculated or predicted at this time without unreasonable efforts. However, for the fourth quarter and full year 2023, ODDITY expects stock-based compensation expense as set forth above. ODDITY is unable to address the probable significance of the unavailable reconciling items, which could have a potentially unpredictable, and potentially significant, impact on its future GAAP financial results.

The financial outlook figures presented above are forward-looking statements that are subject to a variety of assumptions and estimates. Actual results may differ materially from ODDITY’s financial outlook as a result of, among other things, the factors described under “Forward-Looking Statements” below.

Conference Call Details:

A conference call to discuss ODDITY’s Q3 2023 financial and business results and outlook is scheduled for tomorrow, November 8, 2023, at 8:30 a.m. ET. To participate, please dial 1-844-826-3035 (US) or 1-412-317-5195 (international) and the conference ID 10183310. A webcast of the call will be accessible on the Investors section of ODDITY’s website at A recording will be available shortly after the conclusion of the call. To access the replay, please dial 1-844-512-2921 or 1-412-317-6671 (international). An archive of the webcast will be available on the Investors section of ODDITY’s website.

Non-GAAP Financial Measures:

In addition to the GAAP financial measures set forth in this press release, ODDITY has included the following non-GAAP financial measures: Adjusted EBITDA, Adjusted EBITDA margin, Adjusted net income, Adjusted net income margin and Adjusted Diluted EPS. ODDITY believes these non-GAAP financial measures provide useful supplemental information to management and investors to help evaluate ODDITY’s business, measure its performance, identify trends, prepare financial projections and make business decisions.

ODDITY defines “Adjusted EBITDA” as net income before financial expenses (income), net, taxes on income, and depreciation and amortization as further adjusted to exclude share-based compensation expense and non-recurring adjustments. “Adjusted EBITDA margin” is defined as Adjusted EBITDA divided by net revenue. ODDITY believes Adjusted EBITDA and Adjusted EBITDA margin are useful for financial and operational decision-making and as a means to evaluate period-to-period comparisons. By excluding certain items that may not be indicative of its recurring core operating results, ODDITY believes that Adjusted EBITDA and Adjusted EBITDA margin provide meaningful supplemental information regarding its performance. In addition, Adjusted EBITDA and Adjusted EBITDA margin are widely used by investors and securities analysts to measure a company’s operating performance without regard to items such as depreciation and amortization, interest expense, and interest income, which can vary substantially from company to company depending on their financing and capital structures and the method by which their assets were acquired.

ODDITY defines “Adjusted net income” as net income adjusted for the impact of share-based compensation, non-recurring adjustments and the tax effect of non-GAAP adjustments and “Adjusted net income margin” as Adjusted net income divided by net revenue. In addition, ODDITY defines “Adjusted diluted earnings per share” as Adjusted net income divided by diluted shares outstanding. ODDITY believes the presentations of Adjusted net income, Adjusted net income margin, and Adjusted diluted earnings per share are useful because they are frequently used by analysts, investors and other interested parties to evaluate companies in our industry. Further, ODDITY believes these measures are helpful in highlighting trends in our operating results, because they exclude the impact of items that are outside the control of management or not reflective of our ongoing operations and performance.

ODDITY’s non-GAAP financial measures should be considered in addition to, not as a substitute for or in isolation from, its financial results prepared in accordance with U.S. GAAP. Other companies, including companies in our industry, may calculate these measures differently or not at all, which reduces their usefulness as comparative measures.

Reconciliations of non-GAAP financial measures to the most directly comparable GAAP measures are included with the financial tables at the end of this release under the heading “Reconciliations of GAAP to Non-GAAP Measures.”

Forward-Looking Statements:

Certain statements in this press release may constitute “forward-looking” statements and information, within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995 that relate to our current expectations and views of future events. In some cases, these forward-looking statements can be identified by words or phrases such as “aim,” “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “goal,” “intend,” “may,” “objective,” “plan,” “potential,” “predict,” “project,” “shall,” “should,” “target,” “will,” “seek,” or similar words. The absence of these words does not mean that a statement is not forward-looking. [These forward-looking statements address various matters, including ODDITY’s business strategy, market opportunity, ability to deliver superior products and experiences, potential long-term success and ODDITY’s outlook for the fourth quarter 2023 and the full year ending December 31, 2023.These forward-looking statements are subject to risks, uncertainties and assumptions, some of which are beyond our control. In addition, these forward-looking statements reflect our current views with respect to future events and are not a guarantee of future performance. Actual outcomes may differ materially from the information contained in the forward-looking statements as a result of a number of factors, including, without limitation, the following: our ability to maintain the value of our brands; our ability to anticipate and respond to market trends and changes in consumer preferences; our ability to attract new customers, retain existing customers and maintain or increase sales to those customers; our ability to maintain a strong base of engaged customers and content creators; the loss of suppliers or shortages or disruptions in the supply of raw materials or finished products; our ability to accurately forecast customer demand, manage our inventory, and plan for future expenses; our future rate of growth; competition; the fluctuating cost of raw materials; the illegal distribution and sale by third parties of counterfeit versions of our products or the unauthorized diversion by third parties of our products; changes in, or disruptions to, our shipping arrangements; our ability to manage our growth effectively; a general economic downturn or sudden disruption in business conditions; our ability to successfully introduce and effectively market new brands, or develop and introduce new, innovative, and updated products; foreign currency fluctuations; product returns; our ability to execute on our business strategy; our ability to maintain a high level of customer satisfaction; our ability to comply with and adapt to changes in laws and regulatory requirements applicable to our business, including with respect to regulation of the internet and e-commerce, evolving AI-technology related laws, tax laws, the anti-corruption, trade compliance, anti-money laundering, and terror finance and economic sanctions laws and regulations, consumer protection laws, and data privacy and security laws; failure of our products to comply with quality standards and risks related to product liability claims; trade restrictions; existing and potential tariffs; any data breach or other security incident of our information technology systems, or those of our third-party service providers or cyberattacks; risks related to online transactions and payment methods; any failure to obtain, maintain, protect, defend, or enforce our intellectual property rights; conditions in Israel and the Middle East generally, including as a result of geopolitical conflict; the concentration of our voting power as a result of our dual class structure; our status as a foreign private issuer; and other risk factors set forth in the section titled “Risk Factors” in our Prospectus filed pursuant to Rule 424(b) with the Securities and Exchange Commission on July 18, 2023, and other documents filed with or furnished to the SEC. These statements reflect management’s current expectations regarding future events and operating performance and speak only as of the date of this press release. You should not put undue reliance on any forward-looking statements. Except as required by applicable law, we undertake no obligation to update or revise publicly any forward-looking statements.


ODDITY is a consumer tech company that builds and scales digital-first brands to disrupt the offline-dominated beauty and wellness industries. The company serves over 40 million users with its AI-driven online platform, deploying data science to identify consumer needs, and developing solutions in the form of beauty and wellness products. ODDITY owns IL MAKIAGE and SpoiledChild. The company operates with business headquarters in New York City, an R&D center in Tel Aviv, Israel, and a biotechnology lab in Boston.



Michael Braun


U.S. dollar in thousands (except share and per share data)
  Three months ended Nine months ended
 September 30,September 30,
   2023   2022   2023   2022 
Net revenue $94,474  $68,948  $411,439  $257,021 
Cost of revenue  28,060   21,976   120,695   83,101 
Gross profit  66,414   46,972   290,744   173,920 
Selling, general and administrative  60,102   43,251   222,878   146,113 
Operating income  6,312   3,721   67,866   27,807 
Financial expenses (income), net  (2,146)  138   (2,883)  (1,548)
Income before taxes on income  8,458   3,583   70,749   29,355 
Taxes on income  4,624   830   17,328   6,967 
Net income $3,834  $2,753  $53,421  $22,388 
Basic earnings per share of Class A and Class B ordinary share and Redeemable A share (**) $0.07  $0.05  $0.97  $0.43 
Diluted earnings per share of Class A and Class B ordinary share and Redeemable A share (**) $0.06  $0.05  $0.92  $0.40 
(**) Issued and outstanding share information adjusted for the issuance of Class B ordinary shares and additional Redeemable A shares in February 2022 and for the share split effected by way of issuance of bonus shares in July 2023.

U.S. dollar in thousands
  September 30, December 31,
   2023   2022 
Cash and cash equivalents $63,897  $40,955 
Short-term deposits and restricted cash  100,202   20,159 
Trade receivables  7,971   7,576 
Inventory  70,253   70,230 
Prepaid expenses and other current assets  10,107   7,013 
Total current assets  252,430   145,933 
Property, plant and equipment, net  9,338   9,468 
Goodwill and intangible assets, net  101,437   43,037 
Operating lease right-of-use assets  14,348   13,278 
Other assets  5,855   4,692 
Total long-term assets  130,978   70,475 
Total assets $383,408  $216,408 

U.S. dollar in thousands (except share and per share data)
  September 30, December 31,
   2023   2022 
Trade payables $41,759  $44,807 
Other accounts payable and accrued expenses  54,234   37,792 
Short-term debt and current maturities of long-term debt  -   3,917 
Current maturities of operating lease liabilities  3,723   3,890 
Total current liabilities  99,716   90,406 
Operating lease liabilities, non-current  8,922   8,076 
Other long-term liabilities  3,787   6,946 
Total liabilities  112,425   105,428 
Redeemable A shares  -   12,275 
Share capital and additional paid-in capital  172,580   53,723 
Cumulative translation adjustments  1,738   1,738 
Retained earnings  96,665   43,244 
Total shareholders' equity  270,983   98,705 
Total liabilities and shareholders' equity $383,408  $216,408 

U.S. dollars in thousands
  Nine months ended
  September 30,
   2023   2022 
Cash flows from operating activities:    
Net income $53,421  $22,388 
Adjustments to reconcile net income to net cash provided by operating activities:    
Depreciation and amortization  6,234   3,310 
Share-based compensation  16,604   5,019 
Deferred income taxes  (58)  (665)
Increase in trade receivables  (395)  (3,237)
Increase in prepaid expenses and other receivables  (3,024)  (1,293)
Decrease (increase) in inventory  254   (12,676)
Decrease in trade payables  (3,048)  (7,377)
Increase in other accounts payable and accrued expenses  9,616   14,528 
Operating lease ROU assets and liabilities, net  (391)  (1,547)
Other  337   826 
Net cash provided by operating activities  79,550   19,276 
Cash flows from investing activities:    
Purchase of property, plant and equipment  (1,582)  (2,035)
Capitalization of software development costs  (2,440)  (3,783)
Purchase of other intangible assets  -   (340)
Investments in short-term deposits  (80,000)  (15,000)
Other investments  (1,879)  - 
Cash paid in conjunction with acquisition, net of cash acquired  (23,173)  - 
Net cash used in investing activities  (109,074)  (21,158)
Cash flows from financing activities:    
Proceeds from initial public offering, net of issuance costs  55,410   - 
Proceeds from exercise of options  1,671   34 
Repayment of loans and borrowings  (4,313)  (276)
Other  -   648 
Net cash provided by financing activities  52,768   406 
Effect of exchange rate fluctuations on cash and cash equivalents  (259)  (1,336)
Net increase (decrease) in cash, cash equivalents and restricted cash  22,985   (2,812)
Cash, cash equivalents and restricted cash at the beginning of the period  43,114   30,889 
Cash, cash equivalents and restricted cash at the end of the period $66,099  $28,077 

Reconciliation of GAAP to Non-GAAP Financial Information
  Three Months Ended
September 30,
 Nine Months Ended
September 30,
   2023   2022   2023   2022 
  (Unaudited) (Unaudited)
Reconciliation of Net Income and Adjusted EBITDA    
Net Income $3,834  $2,753  $53,421  $22,388 
Financial (income) expenses, net  (2,146)  138   (2,883)  (1,548)
Taxes on Income  4,624   830   17,328   6,967 
Depreciation and amortization  2,234   1,096   6,234   3,310 
Share-based compensation  12,234   1,519   16,604   5,019 
Non-recurring adjustments  -   21   300   701 
Adjusted EBITDA $20,780  $6,357  $91,004  $36,837 

Reconciliation of Net Income and Adjusted Net Income        
Net Income $3,834  $2,753  $53,421  $22,388 
Share-based compensation  12,234   1,519   16,604   5,019 
Non-recurring adjustments  -   21   300   701 
Tax impact  (3,058)  (357)  (4,012)  (1,388)
Adjusted Net Income $13,010  $3,936  $66,313  $26,720 

Diluted earnings per share $0.06  $0.05  $0.92  $0.40 
Adjusted diluted earnings per share $0.21  $0.07  $1.14  $0.48 

Reconciliation of net cash provided by operating activities to free cashflow
  Nine Months Ended
September 30,
   2023   2022 
Net operating cash flow $79,550  $19,276 
Purchase of property and equipment  (1,582)  (2,035)
Free cash flow $77,968  $17,241 

¹ Results greater than $10 million have been rounded to the nearest million.

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