Kits Eyecare (KITS) Q3 2025 earnings summary

Executive summary

• Achieved record Q3 2025 revenue of $52.4 million (CAD 52.4 million), up 25.1% year-over-year and 6% sequentially, with net income of $1.9 million and EPS of $0.06.

• Adjusted EBITDA reached $2.9 million (5.5% margin), up 79% year-over-year, marking the twelfth consecutive quarter of positive Adjusted EBITDA.

• Surpassed 1 million active customers, with 99,000 new customers added in Q3 and year-to-date new customer growth up 36.5%.

• Canadian business grew over 38% year-over-year, while U.S. customer acquisition was temporarily reduced due to market uncertainties.

• KITS branded contact lenses grew 380% year-over-year with gross margins exceeding 50%.

Financial highlights

• Q3 2025 revenue: $52.4 million (+25.1% YoY); gross profit: $18.1 million (+31.6% YoY); gross margin: 34.6%.

• Net income was $1.9 million ($0.06 EPS), up from $0.1 million last year.

• Adjusted EBITDA: $2.9 million (5.5% margin), up from $1.6 million (3.8% margin) in Q3 2024.

• Fulfillment expense improved to 10.2% of revenue, down 60 basis points year-over-year; marketing spend reduced to 14.1% of revenue.

• Cash and cash equivalents at September 30, 2025: $19.7 million.

Outlook and guidance

• Q4 2025 revenue expected between $52 million and $54 million, with adjusted EBITDA margin guidance of 4% to 6%.

• Continued momentum anticipated, with a return to more aggressive U.S. investment as market conditions stabilize.

• Marketing spend to remain in the 13%-15% range of revenue for the next year.

• Internal growth target of 25%-30% for next year, with a long-term goal of double-digit EBITDA margins.

• Plans to announce a Chief Marketing Officer in Q1 2026 to support long-term growth.