Loading...
•
Jun 30
Honest Co Q2 2025 Earnings Report
Honest Co reported second quarter 2025 results, driven by profitability improvement, gross margin expansion, and revenue growth.
Key Takeaways
The Honest Company delivered a strong second quarter in 2025, achieving positive net income for the second consecutive quarter and expanding its gross margin. Revenue saw a slight increase, primarily from retail, while adjusted EBITDA remained stable. The company reaffirmed its full-year 2025 financial outlook.
Revenue increased by 0.4% to $93.5 million, primarily due to growth in retail revenue.
Net income reached $4 million, marking the second consecutive quarter of positive net income and an increase of approximately $8 million year-over-year.
Gross margin expanded by 210 basis points to 40.4%, driven by changes in inventory reserves.
Adjusted EBITDA was $7.62 million, representing the seventh consecutive quarter of positive adjusted EBITDA.
Honest Co
Honest Co
Forward Guidance
The Honest Company reaffirmed its full-year 2025 financial outlook for revenue growth and adjusted EBITDA, anticipating continued positive performance despite macroeconomic conditions.
Positive Outlook
- Reaffirmed full year 2025 revenue growth of 4% to 6%.
- Reaffirmed full year 2025 Adjusted EBITDA in the range of $27 million to $30 million.
- Continued focus on Transformation Pillars: Brand Maximization, Margin Enhancement, and Operating Discipline.
- Successful navigation of a dynamic macroeconomic environment.
- Healthy balance sheet with no outstanding debt.
Challenges Ahead
- Financial outlook reflects assumptions, including current tariff levels, which are subject to change.
- Revenue growth in Q2 2025 was impacted by timing of shipments compared to consumption.
- Shipments trailed consumption in Q2 2025, partially offsetting Q1 2025 results.
- No specific negative forward guidance points were explicitly stated beyond the general macroeconomic environment.
- Unavailability of reliable estimates for certain GAAP components for adjusted EBITDA outlook.