a.k.a. Brands (AKA) Q4 2025 earnings summary

Executive summary

• Net sales grew 4.4% to $600.2 million for fiscal 2025, with U.S. sales up 6.9% and now comprising 66% of total business.

• Princess Polly delivered double-digit net sales growth, expanded its U.S. retail footprint with eight new stores, and launched its first Australian store.

• Inventory was reduced by 10% year-over-year, reflecting improved inventory management and supply chain transformation.

• AI initiatives are driving improvements in product imagery, marketing, and inventory optimization, supporting future margin expansion.

• Net loss widened to $31.4 million for the year, up from $26.0 million last year.

Financial highlights

• Q4 net sales increased 3.1% to $164 million; full-year net sales rose 4.4% to $600.2 million.

• Gross margin for the year expanded 30 basis points to 57.3%, despite 100 basis points of tariff headwinds.

• Adjusted EBITDA for the year was $19.7 million (3.3% of net sales), down from $23.3 million (4.1%) last year due to tariffs and inventory disruptions.

• Q4 gross margin was 55.6%, slightly down from 55.9% last year due to out-of-stocks in best-selling styles.

• Cash flow from operations was $16.4 million for 2025, up from $0.7 million in 2024, driven by improved inventory sell-through.

Outlook and guidance

• Fiscal 2026 net sales expected between $625 million and $635 million, representing 4.2%-5.8% growth.

• Adjusted EBITDA guidance for 2026 is $27 million to $29 million, with margin expansion driven mainly by gross margin improvement.

• Q1 2026 net sales expected between $130 million and $132 million, with low single-digit growth; adjusted EBITDA between $1.5 million and $2 million.

• Capital expenditures projected at $18–$20 million for 2026.

• Guidance excludes potential tariff refunds pending Supreme Court decision.