ODDITY Tech Reports Q2 2026 Financial Results Amid Capital Restructuring
ODDITY Tech reported Q2 2026 net revenues of $181 million, bolstered by strong growth in SpoiledChild and METHODIQ alongside ongoing progress in resolving the IL MAKIAGE algorithm disruption.
ODDITY Tech has released its financial results for the second quarter ended June 30, 2026. The company achieved several key milestones during the quarter, including double-digit revenue growth for SpoiledChild. SpoiledChild is on track for at least 35% growth compared to 2025 and is approaching approximately $350 million in net revenue for 2026.
Business Segments and Financial Strategy
The company reported strong preliminary results for METHODIQ, which it expects will generate net revenue in its first year exceeding that of SpoiledChild during its inaugural year of operation. Furthermore, ODDITY continues the ongoing development and expansion of the molecule discovery platform at ODDITY LABS.
ODDITY improved its capital structure during the period, executing a $80 million Class A ordinary share repurchase and an early redemption of $50 million aggregate principal amount of its 0% convertible senior notes due 2030, while maintaining a robust liquidity profile.
IL MAKIAGE Algorithm Disruption Update
ODDITY continues to work closely with its largest advertising partner to resolve a data disruption affecting the IL MAKIAGE advertising algorithm. Since the last earnings call, the company has implemented various tests and strategies to address the underlying data disruption and retrain the algorithm. ODDITY continues to evaluate the disruption as technical in nature and resolvable, while drawing encouragement from the progress toward normalization.
Share and Convertible Note Repurchases
During the second quarter, ODDITY repurchased approximately 5.6 million Class A ordinary shares for about $80 million under its $200 million share repurchase program authorized in March 2026. Year-to-date, the company has bought back approximately 11.7 million Class A ordinary shares for a total of roughly $163 million. This total includes roughly $50 million of repurchases executed prior to the adoption of the 2026 program under ODDITY's previous buyback authorization. These repurchases have reduced the total number of outstanding ordinary shares by roughly 20%. Approximately $87 million remains available under the 2026 share repurchase program, subject to market conditions and legal and regulatory limits.
In June 2026, ODDITY repurchased and retired $50 million aggregate principal amount of its 0% convertible notes due 2030 for approximately $35 million in cash. Following this transaction, approximately $550 million aggregate principal amount of convertible notes remains outstanding.
Q2 2026 Financial Highlights
For the second quarter ended June 30, 2026, compared to the same period in the prior fiscal year, the company reported:
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Net revenues totaled $181 million compared to $241 million in Q2 2025, representing a 25% decrease.
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Gross profit reached $124 million compared to $174 million in Q2 2025, with a gross margin of 68.7% versus 72.3%.
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Net income stood at $13 million compared to $49 million in Q2 2025.
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Adjusted net income was $11 million compared to $57 million in Q2 2025.
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Adjusted EBITDA totaled $13 million compared to $70 million in Q2 2025.
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Diluted earnings per share were $0.24 compared to $0.79 in Q2 2025, while adjusted diluted EPS stood at $0.20 compared to $0.92.
Cash, cash equivalents, short-term deposits, and marketable securities totaled $561 million as of June 30, 2026.
Management Commentary
Oren Holtzman, founder and CEO of ODDITY, stated:
"We made solid progress during the quarter, including strong performances from both SpoiledChild and METHODIQ. We continue to expect IL MAKIAGE is on a path back to normalization, and we are working closely with our largest advertising partner to resolve the technical issue."
Lindsay Drucker Mann, Global Chief Financial Officer of ODDITY, added:
"So far in the third quarter, we are seeing an improvement in net revenue trends compared to the prior-year period, driven by growth in SpoiledChild and METHODIQ and a moderation of the impact from the IL MAKIAGE account disruption. As a result, we now expect net revenue for the third quarter to decline by approximately 5% year-over-year, marking a meaningful improvement compared to the first half of the year."
