Olaplex (OLPX) Q1 2026 earnings summary

Executive summary

• Net sales increased 2.5% year-over-year to $99.4 million for the quarter ended March 31, 2026, driven by new product launches, strong international growth, and growth in professional and DTC channels, offsetting a decline in specialty retail.

• Gross profit margin improved to 72.1% from 69.5% year-over-year, driven by favorable channel mix and lower inventory write-offs.

• Operating loss was $5.1 million, compared to operating income of $8.5 million in the prior year, primarily due to higher SG&A expenses, including $7.4 million in merger-related costs.

• Net loss was $5.3 million, or $(0.01) per share, versus net income of $0.5 million in the prior year, reflecting higher SG&A and transaction-related costs.

• A definitive merger agreement was signed with Henkel US Operations Corporation for $2.06 per share, a 55% premium to the prior closing price, subject to regulatory and customary conditions.

Financial highlights

• Professional channel sales rose 12.3% year-over-year to $38.8 million; DTC increased 13.8% to $27.2 million; specialty retail declined 13.3% to $33.4 million.

• U.S. net sales decreased 3.5%, while international sales increased 8.6%; U.S. and international sales accounted for 48% and 52% of total net sales, respectively.

• SG&A expenses increased 37.4% year-over-year to $66.0 million, mainly due to higher advertising, payroll, and merger costs.

• Interest expense decreased 48% to $7.1 million, reflecting prior debt repayments and lower rates.

• Cash and cash equivalents totaled $326.2 million as of March 31, 2026, with $150 million undrawn revolver capacity.

Outlook and guidance

• The merger with Henkel is expected to close in the second half of 2026, pending regulatory approvals.

• Strategic priorities for 2026 include energizing core products, accelerating science-based innovation, and expanding the go-to-market model.

• Management expects sufficient liquidity to meet operating and capital needs in the short and long term.

• No further financial guidance will be provided due to the pending acquisition.