Oddity Tech Ltd Q2 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Dara Mohsenian - Morgan Stanley - Analyst : Hey. Good morning, guys. So the metrics you gave on the year-over-year performance were helpful. Can you also spend some time talking about where revenue upside came from in the quarter, both in terms of metrics, repeat, average order size, etcetera, but also at the brand level, in terms of SpoiledChild versus IL MAKIAGE. And how you think about the sequential pace of SpoiledChild going forward after a very successful launch over the last couple of years, and how that brand is developing versus your expectations?

Question: Lauren Lieberman - Barclays - Analyst : So I'm going to loop two questions into one. So first, Oran, I thought it was helpful, the sort of discussion you shared on LABS and the time it takes to build what you're hoping to. But I was curious as we think about new product launches, inclusive of Brand 3 and Brand 4 for next year, whether there are sort of unique and discreet molecules that will be included in those. So I think my recollection is that was the hope, that LABS would be contributing in 2025 to some of the new products you'd be bringing to market. So I wanted to just get a status check on that. And then the second piece was the step-up in SG&A spending in the second half, and I know you guys have a habit of investing ahead and planning ahead for growth. But given the Brand 3 and Brand 4 aren't launching into the second half of '25, it seems like a lot of spending closer in. So I was curious if that's where it's directed or if it's more towards continuing to scale LABS.

Question: Youssef Squali - Truist Securities - Analyst : Sorry about that. I don't know what happened. So two questions. Maybe can you just unpack a little more the investments that you guys have in store for Brand 3, Brand 4 versus the investment in ODDITY LABS? It seems that you guys are looking at the two somewhat differently. ODDITY LABS is more of a long-term kind of investment with an ROI that's still not very clear to us, although it seems to be very clear to you. But investment in Brand 3 and Brand 4 seem to be kind of more specific. So anything you can -- any kind of clarity you can shed on that would be really helpful. And then maybe as a somewhat of a related question, Oran, maybe talk a little bit about the changing leadership at LABS. Any change in direction? Any impacts on maybe the cadence of output of either products or molecules, however you want to define it out of that LABS now that you have new kind of leadership there?

Question: Andrew Boone - Citizens JMP Securities, LLC - Analyst : Thanks so much for taking my question. Oran, you said earlier that media spend had doubled in the first half of this year versus two years ago. Revenue is up more than that. Can you just talk about the efficiencies that you guys are being able to generate on media spend and the confidence that continues? What has worked? What hasn't worked and where you guys finding pockets of strength? And then, Lindsay, as I think about the formulation for revenue growth this quarter, I think you said AOV was up 6%. That kind of implies that orders are right at that 20% level. Is that the right framework that we should think about growth going forward? Is that, hey, maybe AOV is mid-single digits and order growth is kind of 20% and you guys are solving for that 20%? Or is there any way that we should think about the breakdown of P times Q equals R? Thanks so much.

Question: Mark Mahaney - Evercore ISI - Analyst : Thanks. Two questions, please. Can you just talk about what are the biggest governors or factors that determine the launch times for Brands 3 and 4? Is it product readiness? Is it go-to-market plan readiness? Like what determines for you that why they're launched in the second half of '25 versus the first half of '25? And in just your current business, could you talk about any regions -- geographical regions of strength or weakness? And embed in that question, any signs of consumer discretionary spend softness? Thank you very much.

Question: Mark Mahaney - Evercore ISI - Analyst : No, Oran, you got my question right. Any regions of strength or weakness to call out and any signs of consumer softness? Thank you.