You beauty! Adore Beauty has reported a strong third quarter, with revenue increasing nine percent on PCP, and active customers continuing to lift.
The online beauty retailer has reported its Q3 results, which have been in the green for this quarter. But how are investors responding?
Its revenue has increased nine percent on PCP, generating $42.7 million, with its revenue growing 26 percent over a two-year period (CAGR since Q3 FY20).
Moreover, its active customer base has increased by seven percent, inching closer to 900,000 (currently 880k). Of this, there is a cycling new customer growth o 89 percent on PCP. Adore Beuaty shared that its retention strategy is working well, with returning customer growth of 47 percent on PCP, and a two-year CAGR of 54 percent.
“Adore Beauty has delivered a strong quarterly performance in a reopening environment, a very pleasing outcome given the 47 percent revenue growth recorded in the PCP, and having to navigate some supply chain pressures during the period,” shared Tennealle O’Shannessy, the CEO of Adore Beauty.
“Importantly, our loyalty-focused strategic initiatives are enabling us to convert new customers to loyal, valuable returning customers.”
According to O’Shannessy, beauty, especially the skincare category, is not only unique to the broader retail market, but it is ‘resilient to economic challenges’. “Our products are used daily by customers, who consider these items essential and frequently re-purchase,” she said. “The nature of premium beauty means our customers spend more as they mature on the platform, with returning customers typically contributing more than 70 percent of total revenue.”
Its native app currently generates more than ten percent of total revenue, and has continued to “deliver elevated levels of engagement, conversion, and average order values,” said O’Shannessy.
As mentioned in its half-year update in February, the business has plans to launch its private label product later this year. Adore Beauty continues this plan, with the lunch expected to take place in Q4 FY22.
During the last update, investors weren’t as convinced by the business’ growth, shedding 8.15 the same morning the results were announced. So, how are they faring now?
At the time of writing, Adore Beauty’s shares fluctuated. Opening at $1.68 a share on Friday morning, they reached a peak of $1.72, before dropping back down to $1.66 by Friday’s close.
The business has experienced a rough 90 days, shedding more than 60 percent over a 90-day period, as reported in the most recent Stock Watch.
The good news from the business may be exactly what the doctor ordered for its share prices. We’ll keep you posted.
The e-commerce landscape is changing. With a Power Retail Switched On membership, you get access to current e-commerce revenue and forecasting, traffic levels, average conversion rate, payment preferences and more!