Personal care firm Honest misses Q3 revenue estimates

Honest

05/11/2025 22:23

Overview

Honest Company Q3 revenue misses analyst expectations, declining 6.7% yr/yr

Adjusted EBITDA for Q3 beats analyst expectations, reflecting operational efficiency

Company launches Transformation 2.0, exiting lower margin categories to enhance profitability

Outlook

Company updates full-year 2025 revenue outlook to range from -3% to flat

Company expects full-year 2025 adjusted EBITDA of $21 to $23 mln

Company projects full-year 2025 organic revenue growth of 4-6%

Result Drivers

TRANSFORMATION 2.0 - Launch of program to exit lower margin categories and optimize cost structure to enhance profitability

REVENUE DECLINE - Revenue decreased due to strategic exits from Honest.com fulfillment and apparel, affecting retail revenue

NET INCOME IMPROVEMENT - Positive net income achieved through disciplined execution and operational efficiency, per CEO Carla Vernón

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
Q3 Revenue
Miss
$92.57 mln
$99.40 mln (6 Analysts)
Q3 Net Income
$758,000
Q3 Adjusted EBITDA
Beat
$3.52 mln
$2.53 mln (4 Analysts)
Q3 Gross Margin
37.3%


Analyst Coverage

The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 5 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

The average consensus recommendation for the miscellaneous specialty retailers peer group is "buy"

Wall Street's median 12-month price target for Honest Company Inc is $7.25, about 54.1% above its November 4 closing price of $3.33

The stock recently traded at 33 times the next 12-month earnings vs. a P/E of 51 three months ago

Press Release: ID:nGNX3zRsvQ

For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact RefinitivNewsSupport@thomsonreuters.com.

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)