Anna Lizzul

Anna Lizzul asked about the potential for ODDITY to recover revenue for the remainder of the year, if user acquisition could be shifted from H1 to H2, and whether the current challenges would prompt a change in their direct-to-consumer distribution strategy towards retail.

Answer

Oran Holtzman, Co-founder and CEO, affirmed no change in ODDITY's online-first strategy and no plans to move into retail, expressing confidence in returning to growth. Lindsay Drucker Mann, Global CFO, noted that current CPAs are significantly higher (2x+), leading to reduced acquisition spend and unprofitability at first order, though still profitable on a 12-month contribution margin basis. She explained that reduced Q1/Q2 acquisition would impact H2 repeat sales, viewing the situation as a temporary 'pothole' with expected normalization in H2.

Anna Lizzul asked about the lack of full-year guidance, the possibility of shifting user acquisition from H1 to H2, and if the current challenges would prompt a change in distribution strategy, such as moving into retail.

Answer

Oran Holtzman, Co-founder and CEO, Oddity Tech, confirmed no change in the online-only distribution strategy, expressing confidence in returning to growth after adjusting to the temporary technical issue. Lindsay Drucker Mann, Global CFO, Oddity Tech, explained that significantly higher CPAs in Q1 and Q2 led to reduced acquisition, impacting near-term EBITDA and causing a carryover effect on repeat sales in H2, but reiterated the goal to normalize the financial model as CPA recovers.

Anna Lizzul inquired about the outlook for METHODIQ in 2026, specifically regarding new customer acquisition strategies compared to SpoiledChild and Il Makiage. She also asked for clarification on the expected impact of new brand investments on SG&A for Q4 and early 2026.

Answer

Oran Holtzman, Co-founder and CEO of ODDITY, stated expectations for METHODIQ to scale faster than SpoiledChild, though its initial revenue contribution will be small. Lindsay Drucker Mann, CFO of ODDITY, added that while specific 2026 plans are not yet available, the company remains bullish on METHODIQ's long-term potential as a telehealth platform. She clarified that SG&A guidance is conservative, focusing on overall revenue and EBITDA targets, with planned investments continuing into Q4 and the first half of 2026.

Anna Lizzul of Bank of America Merrill Lynch requested more details on the company's investments in Brand 3 and Brand 4, and asked about the expected timeline for seeing returns on these significant investments.

Answer

CEO Oran Holtzman outlined three main investment pillars: new brands (Brand 3 & 4), Oddity Labs, and technology. He explained that the company reinvests margin dollars above its 20% target into these future growth initiatives. He cited Spoiled Child as an example of ROI, noting a ~$25M investment has grown into a $200M revenue brand with healthy margins within three years.

Anna Lizzul asked about e.l.f. Beauty's marketing spend plans for the second half of the fiscal year, specifically the decision to run a Super Bowl ad this year after not doing so last year, and the allocation of the significantly higher marketing spend expected in fiscal Q4. She also sought clarification on what led to the overall lower second-half EBITDA margin expectation compared to the original outlook, particularly regarding the cost shift from fiscal Q3 to Q4.

Answer

Mandy Fields, SVP and CFO, stated that the full-year marketing spend target of 24%-26% remains unchanged, but timing shifts led to a heavier spend in Q4. She clarified that the Super Bowl participation is through streaming on Peacock and Univision, not a broad national ad. Ms. Fields explained that the second-half adjusted EBITDA margin is now expected to be around 19%, which is better than previously outlooked, primarily due to the timing shifts of costs from Q3 into Q4.

Anna Lizzul questioned e.l.f. Beauty's marketing spend plans for the second half, specifically the decision to run a Super Bowl ad this year and the allocation of higher Q4 marketing spend. She also sought clarification on the improved second-half adjusted EBITDA margin outlook, asking what changed from previous expectations.

Answer

Mandy Fields, SVP and CFO, confirmed the full-year marketing spend target (24%-26%) remains unchanged, with timing shifts leading to heavier Q4 spend. She clarified that the Super Bowl/big game participation is via streaming (Peacock, Univision) rather than a broad national ad. Fields reiterated the second-half adjusted EBITDA margin outlook of 19% (better than previously expected) is primarily due to cost shifts from Q3 to Q4.

Anna Lizzul of Bank of America inquired about the long-term product strategy for Rhode, including its curated assortment and the potential for expansion into new categories such as fragrance.

Answer

CEO & Chairman Tarang Amin stated that a key strength of the Rhode brand is its highly curated and thoughtful product assortment, and the company plans to maintain this focused approach. While he noted a strong innovation pipeline and ongoing discussions about new ideas, he emphasized that any future launches would align with the brand's core identity and aesthetic, without committing to specific category expansions.

Anna Lizzul of Bank of America questioned if the Rhode acquisition could create distribution opportunities for other e.l.f. brands in Sephora and whether the company is shifting to a brand portfolio model with more acquisitions.

Answer

Chairman and CEO Tarang Amin explained that the Rhode deal accelerates an already progressing relationship with Sephora, creating opportunities for the entire portfolio. He affirmed e.l.f. is a portfolio of brands but stated the immediate priorities are organic growth and the successful integration of Rhode, not further M&A.

Anna Lizzul requested a performance breakdown by category for Q3 and January, and asked for commentary on skincare trends, comparing e.l.f. Skin's performance to Naturium's.

Answer

Chairman and CEO Tarang Amin responded that Q3 saw broad-based strength and significant share gains across all color cosmetics segments and in skincare. For the softer month of January, he noted that the lip subcategory was the strongest performer. He also mentioned that skincare, as a whole, continued to grow at a faster clip than cosmetics in January, and the company's strategy provides opportunities to grow share across all of its segments.

Anna Lizzul asked about sales trends across different channels and retailers, any observed shifts in purchasing habits, and the planned product assortment for the Dollar General expansion.

Answer

CEO Tarang Amin reported broad-based strength across national retailers, digital, and international channels, noting that quarter-to-quarter channel performance can be noisy due to specific launch timings. CFO Mandy Fields confirmed the Dollar General assortment will feature the brand's best-selling 'Holy Grail' products, not a modified or lower-tier selection, to maintain brand integrity and accessibility.

Anna Lizzul asked about Clorox's current position versus category growth rates post-quarter and what category growth rate would be needed to meet the Ignite strategy's 3-5% net sales growth algorithm.

Answer

Linda Rendle, Chairman and CEO, reiterated that categories were about flat in Q1 and Q2, in line with expectations. She cautioned against projecting from recent noisy January data due to weather. She expects categories to remain flat to up 1% in the back half, with Clorox's plans supporting both category and share growth. To achieve the Ignite strategy's 3-5% net sales growth, she stated categories historically need to return to 2-2.5% growth, plus an incremental point from pro and international businesses, with the GOJO acquisition also contributing to this algorithm.

Anna Lizzul asked about Clorox's current position relative to the category growth rate post-quarter and what category growth rate would be necessary to achieve the longer-term Ignite strategy algorithm of 3%-5% net sales growth.

Answer

Linda Rendle (Chairman and CEO) noted that categories were about flat in Q1 and Q2, in line with expectations, and cautioned against projecting from recent noisy January data. She expects categories to remain flat to up 1% in the back half. To achieve the 3%-5% Ignite algorithm, she stated that categories need to return to historical growth rates of 2%-2.5%, with an additional point of incremental growth from the professional and international businesses, plus the accretive growth from the GOJO acquisition.

Anna Lizzul inquired about destocking trends from retailers and how the company plans to increase its exposure to club and online channels, including any specific innovation for these channels, particularly for the Glad brand. She also asked for an update on private label share, specifically in wipes and other categories.

Answer

CEO Linda Rendle stated no material destocking impact due to ERP-related inventory rebuilding, noting retailers' structural work to reduce inventories. She highlighted a strong club business with specific innovation for club members and ongoing efforts to improve Glad's position in that channel. On private label, she noted no material aggregate inroads but is carefully watching Brita filters and bleach, while the cleaning portfolio generally performs well against private label.

Anna Lizzul of Bank of America Merrill Lynch inquired if the expected improvement in the second half of fiscal 2026 is based on a better consumer environment or company-specific actions. She also asked about the strategy for trade promotions and recent private label trends.

Answer

CEO Linda Rendle clarified that the H2'26 improvement is predicated on factors Clorox controls, such as innovation and net revenue management, not an assumed consumer recovery. She defended strategic promotions but acknowledged Q4 execution could have been better. Regarding private label, Rendle stated there has been no material aggregate shift, though some channel dynamics are impacting the Glad business.

Anna Lizzul asked for details on promotional activity by category, particularly in Glad, and questioned the strategy of launching premium innovations amid weakening consumer sentiment.

Answer

CEO Linda Rendle stated that while aggregate promotions are normalized, the Glad category is seeing higher, deep-discounting activity from a competitor. She affirmed that consumers are still willing to pay for premium innovation that delivers superior value, citing the success of new premium products in ToiletWand, cat litter, Burt's Bees, and Hidden Valley. She noted that the Clorox brand itself, a premium portfolio, gained over 2 points of household penetration in the last 52 weeks.

Anna Lizzul of Bank of America asked about consumer spending dynamics across different channels and purchasing behaviors, such as shifts between larger and smaller pack sizes. She also sought to clarify if promotion is the primary tool for gaining market share in Litter and Glad.

Answer

CEO Linda Rendle emphasized that promotion is just one part of the strategy, with a primary focus on value-added innovation. She described the consumer as steady but exhibiting value-seeking behaviors, such as trading up for innovation and buying both large and small sizes. She also noted that private label shares were down and Clorox grew share in 7 of its 8 categories.

Anna Lizzul asked about the expected mix of pricing versus volume in driving growth for the remainder of the year and whether the high advertising spending rate in the U.S. retail business is expected to continue.

Answer

CEO Linda Rendle clarified that future growth will be primarily volume-based, driven by innovation and demand-creation activities, rather than significant list price increases. She confirmed that aggregate advertising and sales promotion spending is expected to remain around 11-11.5% of sales, with the U.S. business typically maintaining a higher spending rate than the international business.

Anna Lizzul inquired about the company's longer-term gross margin potential, specifically how the shift in business mix (from 40% value/60% premium to 36% value/64% premium due to recent acquisitions) might drive future gross margin expansion.

Answer

CEO Rick Dierker confirmed that recent acquisitions, being higher-margin personal care businesses, bode well for gross margin. He noted that it's too early to change the Evergreen Model gross margin guide given recent tariffs and inflation, but expressed confidence in gross margin expansion, citing 100 basis points improvement expected in 2026 and flat margins in 2025 despite significant tariffs. CFO Lee McChesney added that the outlook contemplates current knowns, but conditions can evolve.

Anna Lizzul asked about the longer-term gross margin potential, specifically how the portfolio mix shift (now 36% value, 64% premium) impacts gross margin expansion, and whether this value/premium split is expected to change over time.

Answer

Rick Dierker (CEO) confirmed that recent acquisitions are higher-margin personal care businesses, positively impacting gross margin. He expressed confidence in gross margin expansion, citing 100 basis points improvement this year and flat margins in 2025 despite tariffs, but cautioned against definitive long-term gross margin guides due to rapid market changes. Lee McChesney (CFO) added that the current outlook incorporates all known factors.

Anna Lizzul from Bank of America Merrill Lynch followed up on the consumer environment, asking for Church & Dwight's perspective given that some peers expect a second-half acceleration. She also inquired about the company's strategic initiatives, including promotional and marketing support.

Answer

President and CEO Rick Dierker expressed confidence in growth, attributing it to a combination of category trends and a strong share gain story across key brands like TheraBreath and Hero. He confirmed that the company is protecting its marketing spend, targeting 11% of sales for the full year, with an acceleration in Q3 to between 12.5% and 13% to support brands and new innovation.

Anna Lizzul asked about the company's expectations for category growth versus market share gains, particularly given soft trends in April. She also questioned if there were differences in the slowdown between premium and value segments and if the company was seeing any benefit from consumer trade-down.

Answer

Executive Richard Dierker stated that while the overall category growth outlook has been lowered to 1-1.5%, the company still expects to grow faster and gain share. He noted that, surprisingly, they are not yet seeing the significant consumer trade-down that might be expected in this environment, but believes Church & Dwight is well-positioned for when it occurs.

Anna Lizzul asked about the gross margin outlook, suggesting the full-year guidance appeared conservative after a strong Q3, and inquired about cost pressures. She also asked about consumer purchasing habits.

Answer

CFO Rick Dierker acknowledged the guidance could be seen as conservative but highlighted that Q4 2023 was a high watermark for comparison. He cited several factors for the Q4 outlook, including rising commodity costs like ethylene, ongoing investments in the warehouse network, and increased trade and couponing support for new product launches. He also stated there were no notable changes in consumer purchasing patterns.

Speaking on behalf of Anna Lizzul, John Keeper asked if there was a risk of negative pricing in the second half due to the promotional environment, and whether the company could pivot its innovation pipeline towards more value-oriented products for 2025.

Answer

Richard Dierker (CFO and Head of Business Operations) stated that the company does not expect negative pricing in the second half. Matthew Farrell (executive) confirmed that the company is adept at pivoting quickly on pack sizes to create different price points to meet changing consumer needs.

Anna Lizzul inquired about the evolving diaper category, particularly the expansion of ultra-premium players, and Kimberly-Clark's strategy to compete across mid-tier, value, and ultra-premium segments through innovation or M&A. She also asked for elaboration on efforts to reduce fiber cost volatility, including the impact of the JV agreement.

Answer

CEO Mike Hsu expressed confidence in Kimberly-Clark's superior technologies and innovation pipeline, aiming to win across all 'good, better, best' tiers. He cited significant premium mix growth in North America (40% to nearly 70% in 10 years) and China (6% to over 40% in 5 years), emphasizing the need for strong value propositions and cascading innovation. President and COO Russ Torres agreed on the potential for continued category premiumization. On fiber volatility, Mike Hsu explained that the IFB transaction with Suzano stabilizes fiber costs and inherently reduces volatility. CFO Nelson Urdaneta added that integrated margin management over the past 2.5-3 years has fostered proactive volatility management and cultural change, supporting their long-term margin targets.

Anna Lizzul from Bank of America explored Kimberly-Clark's strategy for competing in the evolving diaper category, particularly with the rise of ultra-premium players and increased competition across all tiers. She inquired about the potential for innovation or M&A in the ultra-premium segment and the company's efforts to reduce fiber cost volatility following the JV agreement.

Answer

CEO Mike Hsu and President & COO Russ Torres affirmed Kimberly-Clark's confidence in its superior technology and innovation pipeline to win across the "good, better, best" spectrum, highlighting successful premiumization globally and the strategy of cascading innovation to mid-tiers. CEO Mike Hsu and CFO Nelson Urdaneta explained that the IFB transaction with Suzano and integrated margin management efforts are significantly stabilizing fiber costs and reducing overall volatility, contributing to confidence in achieving long-term margin targets.

Anna Lizzul asked if the current cost environment is impacting the ability to invest in marketing and whether the long-term strategy of portfolio premiumization is changing due to the more value-conscious consumer.

Answer

CFO Nelson Urdaneta stated that the guidance was adjusted to absorb the tariff impact without cutting key investments. He noted marketing spend was ~6% of sales in Q1, in line with prior year, and capital investments remain on track. CEO Michael Hsu added that the core strategy is to avoid reducing product quality or marketing, as they believe the tariff costs can be offset over time by re-optimizing the supply network.

Anna Lizzul asked about the strategy of being 'choiceful' in international markets and if further market exits are anticipated. She also inquired about the momentum in the K-C Professional business and its 2025 volume outlook.

Answer

CEO Michael Hsu stated that after recent exits in markets like Nigeria and Bolivia, the company feels good about its current portfolio but will remain disciplined in its capital allocation. Regarding the Professional business, he acknowledged some softness in North American washrooms but expressed confidence in the plans for improvement and the overall global position.

Anna Lizzul inquired about the company's exit from certain private label businesses, asking for details on the progress of this initiative and how it contributes to the long-term gross margin goal of at least 40% by 2030.

Answer

CEO Michael Hsu explained that the private label exit is a strategic move to focus capacity and technology on proprietary, branded innovation. He confirmed that the company's private label mix will shrink from approximately 4% of sales in 2023 to about 2% in 2025 following the exit of a large club diaper business, with further declines expected over time. This shift supports growth in higher-margin brands like Kleenex.

Anna Lizzul asked if Coty is observing a pullback in prestige fragrance consumption from specific demographics like Gen Z, men, or Hispanics in the U.S., or from any particular income tiers in the broader U.S. beauty market.

Answer

CEO Sue Nabi responded that the company is not seeing a pullback from these key growth demographics. In fact, she noted that penetration continues to increase among Gen Z and teen males, the Hispanic community remains a strong consumer of fragrances, and the proportion of heavy users among Gen Z has never been higher. She did not comment on specific income tiers but emphasized the strength of these consumer groups.

Anna Lizzul inquired if Coty is observing a pullback in prestige fragrance consumption from key growth demographics like Gen Z, men, and Hispanic consumers, or from specific income tiers in the U.S. beauty market.

Answer

CEO Sue Nabi stated that Coty is not seeing a pullback from these key demographics. She noted that penetration continues to increase among Gen Z and teen males, the Hispanic community remains a strong consumer, and the proportion of heavy users among Gen Z has never been higher. The company did not directly address specific income tier pullbacks.

Anna Lizzul from Bank of America Corporation asked about current market conditions, specifically if weakness in lower-income consumers is impacting Consumer Beauty and if there's any slowdown from higher-income consumers affecting Prestige.

Answer

CEO Sue Nabi stated the Prestige market has normalized to a sustainable mid-single-digit growth rate with no new slowdown, noting the fragrance category remains structurally strong. CFO Laurent Mercier addressed Consumer Beauty, highlighting a two-speed market: the global color cosmetics category is in a mid-single-digit decline, while mass fragrance is growing at a high-single or double-digit rate. The company assumes the negative trend in color cosmetics will continue in fiscal '26.

Anna Lizzul of BofA Securities asked about the retailer channel shift in the U.S., particularly the rise of Amazon, and how Coty's Consumer Beauty and Prestige businesses are performing on that platform.

Answer

CEO Sue Nabi acknowledged that fierce competition between online and offline players is pressuring retailers. She highlighted Coty's long-standing partnership with Amazon and stated that e-commerce growth is 'stellar' in both divisions. Specifically, she noted that CoverGirl is growing faster than the e-com color cosmetics market and gaining share, while Prestige brands are also performing exceptionally well on the platform.

Anna Lizzul inquired about the retailer channel shift in the U.S., particularly the growing market share of online platforms like Amazon, and how Coty's different business segments are performing in this environment.

Answer

CEO Sue Nabi acknowledged that fierce competition between online and offline players is pressuring retailer inventory management. She emphasized Coty's long-standing partnership with Amazon and highlighted stellar e-commerce growth across both the Prestige and Consumer Beauty divisions. As an example, she noted that the CoverGirl brand is growing faster than the e-com market for color cosmetics in the U.S., thereby gaining share in that channel.

Anna Lizzul followed up on the Skin Health and Beauty segment, asking how Kenvue is balancing significant promotional activity with marketing investment and whether upcoming innovations are expected to lead to shelf space gains.

Answer

CEO Thibaut Mongon confirmed that Kenvue plans to increase brand investment in 2025, with a focus on ROI. He noted the company is in an 'investment mode' for the segment, and while progress on gross margins is currently masked by first-half price and trade investments, he expects margins to improve over time as consumption increases and these headwinds fade.

Anna Lizzul asked about the Skin Health and Beauty segment, focusing on the 2025 innovation pipeline, the potential for shelf space gains, and expectations for the upcoming Sun Care season.

Answer

CEO Thibaut Mongon acknowledged the recovery is taking longer than anticipated but highlighted positive signs, such as Neutrogena regaining its #1 U.S. face care position. He expressed confidence in returning the segment to growth in 2025, driven by a revamped team, a 40% larger innovation pipeline, and stronger influencer-led marketing campaigns, like the recent one with Tate McRae. He added that the company feels well-prepared for the Sun Care season.

Anna Lizzul asked for an overview of recent trends in the Skin Health segment, the primary initiatives for its new leader, and the specific impact of weakness in China on the business.

Answer

Executive Thibaut Mongon detailed external pressures on Skin Health, including a slow sun season and softness in Asia, but highlighted internal actions like strengthening the team with new hire Andrew Steimle and forming key partnerships with dermatologists. Andrew's role is to amplify existing 'green shoots' across the portfolio. Executive Paul Ruh clarified that the impact from anti-Japanese sentiment in China was lapped in Q3 and is not a material factor going forward.