DAVIDsTEA (DTEA) Q2 2025 earnings summary

Executive summary

• Achieved a key inflection point in Q2 2024 with sales up 12.8% year-over-year to $11.1 million, driven by product innovation and assortment management, with strong growth in Canada and stable U.S. sales.

• Focused on in-store growth strategy to complement digital platforms, with new store openings in high-traffic Montreal malls, including Royalmount Mall and an upcoming flagship at Montreal Eaton Centre.

• Net loss reduced to $1.5 million in Q2 2024, down from $4.3 million in Q2 2023, reflecting improved profitability.

• Adjusted EBITDA improved to negative $0.3 million from negative $2.6 million year-over-year.

• Early Q3 revenues up more than 18% compared to the same period in 2023, indicating continued sales momentum.

Financial highlights

• Consolidated sales increased 12.8% year-over-year in Q2 and 1.6% year-to-date in fiscal 2024, reaching $11.1 million in Q2.

• Gross profit margin reached 47.3% in Q2, up from 36.9% in Q2 2023, with gross profit increasing 44.6% to $5.3 million.

• SG&A expenses declined 15.2% to $6.7 million, representing 16.5% of sales, and as a percentage of sales, SG&A fell to 60.5% from 80.6%.

• Cash position at quarter-end was $6.7 million, down from $14.2 million a year earlier.

• Net loss per share improved to $0.06 from $0.16; adjusted net loss per share was $0.04 versus $0.14 year-over-year.

Outlook and guidance

• Early Q3 revenues up more than 18% compared to the same period in 2023.

• Anticipates sustained growth in revenue-intensive Q3 and Q4, supported by new store openings and ongoing initiatives.

• Expects U.S. wholesale channel growth to materialize in 2025.

• Focus remains on expanding brick-and-mortar presence and driving innovation in tea blends.