Build-A-Bear Workshop (BBW) Q2 2025 earnings summary

Executive summary

• Second quarter revenues rose 2.4% to $111.8 million, with pre-tax income up 10.2% and diluted EPS up 12.3% year-over-year, driven by strong commercial growth and global expansion.

• EBITDA for Q2 2024 rose 10.7% to $15.0 million, while first half EBITDA declined 7.4% to $33.3 million due to higher SG&A expenses and lower retail gross margin.

• The company continued its three-pronged strategy: global retail expansion, digital transformation, and fiscal discipline, opening a net 23 new experience locations in H1 2024 and expecting at least 50 net new units for the year.

• Diversified customer base, with teens and adults now representing about 40% of retail sales.

• Returned $23.9 million to shareholders in the first half through share repurchases and dividends.

Financial highlights

• Q2 net income was $8.8 million, up from $8.3 million in Q2 2023; diluted EPS was $0.64, up from $0.57.

• Total revenues for Q2 2024 were $111.8 million, up from $109.2 million in Q2 2023; H1 2024 revenues were $226.5 million, down 1.2% year-over-year.

• Gross margin improved by 50 basis points to 54.2% in Q2, driven by commercial and retail margin expansion.

• SG&A expenses were $49.2 million, or 44% of revenue, a 20 basis point improvement year-over-year.

• Cash balance at quarter end was $25.2 million after returning $33 million to shareholders over the past year.

Outlook and guidance

• Fiscal 2024 guidance reaffirmed: total revenue and pre-tax income growth expected on a low- to mid-single-digit percentage basis, with net new unit growth of at least 50 locations globally.

• Anticipates revenue acceleration in Q3 and Q4, with strong product launches and favorable comparisons.

• Capital expenditures projected at $18–$20 million; depreciation and amortization at $15–$16 million; tax rate to approximate 26%.

• Guidance reflects ongoing inflationary pressures, increased freight and depreciation costs, and assumes no major macroeconomic or geopolitical changes.