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Brilliant Earth Group, Inc. (BRLT)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 delivered net sales at the high end of guidance ($119.5M) and profitability that “far surpassed guidance,” with GAAP diluted EPS of $0.02 and adjusted diluted EPS of $0.04; gross margin expanded 90 bps YoY to 59.6% .
  • Orders grew 10% YoY in Q4, with repeat orders up 18% YoY; fine jewelry bookings were strong, with December fine jewelry reaching a record 27% of total bookings .
  • 2025 outlook: Q1 net sales $93.5–$95.5M and adjusted EBITDA $0–$1.5M; FY 2025 net sales +1–3% YoY and adjusted EBITDA margin 3–4%; management reiterated gross margin expectation in the “high 50s” and flagged H2 weighting for revenue/EBITDA .
  • Key narrative: premium brand and price optimization drove margin resilience despite a highly promotional environment; mix shift to sub‑$5K engagement rings and fine jewelry expansion reduced AOV while supporting order growth and repeat behavior .

What Went Well and What Went Wrong

  • What Went Well

    • Hit high end of net sales guidance and materially exceeded profitability guidance; 14th consecutive quarter of profitability as a public company .
    • Gross margin expanded to 59.6% (+90 bps YoY) in Q4, underpinned by premium brand, proprietary product, price optimization, procurement efficiencies and enhanced extended warranty program .
    • Strong demand signals outside bridal: fine jewelry bookings grew double‑digit, December fine jewelry share hit 27%; Black Friday was the biggest bookings day in company history .

  • What Went Wrong

    • Net sales declined 3.9% YoY to $119.5M, reflecting industry-wide promotional dynamics and softer higher-ticket bridal; Q4 AOV fell 12.8% YoY to $2,048 as mix skewed to sub‑$5K engagement rings and more fine jewelry .
    • Sequential gross margin down from Q3 (Q3: 60.8% vs Q4: 59.6%) as mix shifted and holiday promotional intensity remained high .
    • FY 2025 adjusted EBITDA margin guide of 3–4% is below FY 2024 actual 5.0% as the company invests in brand, employees, G&A and showrooms, which may pressure near‑term profitability optics .

Financial Results

  • Quarterly comparisons and KPIs
MetricQ4 2023Q3 2024Q4 2024
Revenue ($USD Millions)$124.3 $99.9 $119.5
GAAP Diluted EPS ($)$0.02 $(0.01) $0.02
Adjusted Diluted EPS ($)$0.04 $0.02 $0.04
Gross Margin (%)58.7% 60.8% 59.6%
Net Income ($USD Millions)$1.9 $(1.1) $2.6
Net Income Margin (%)1.6% (1.1)% 2.2%
Adjusted EBITDA ($USD Millions)$5.3 $3.6 $6.9
Adjusted EBITDA Margin (%)4.2% 3.6% 5.8%
Total Orders (units)52,935 42,744 58,357
Average Order Value ($)$2,349 $2,337 $2,048

  • Actual vs. Estimates (S&P Global)

    • Consensus for Q4 2024 (revenue, EPS) was unavailable at the time of this analysis due to S&P Global request limits. The company stated it reached the high end of its own net sales guidance and exceeded profitability guidance .

  • Additional context

    • FY 2024: Revenue $422.2M, gross margin 60.3% (+270 bps YoY), adjusted EBITDA $21.1M (5.0% margin), cash $161.9M, net cash ~ $106M (highest since 2021) .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Sales ($)Q1 2025N/A (first issuance)$93.5M–$95.5MNew
Adjusted EBITDA ($)Q1 2025N/A (first issuance)$0–$1.5MNew
Net Sales Growth (YoY)FY 2025N/A (first issuance)+1% to +3%New
Adjusted EBITDA Margin (%)FY 2025N/A (first issuance)3%–4%New
Gross Margin (%)FY 2025Medium‑term target “high 50s” reiterated“High 50s”Maintained
CadenceFY 2025N/ABack‑half weighted revenue; ~2/3 of adj. EBITDA from H2New color

Earnings Call Themes & Trends

TopicQ2 2024 (Q-2)Q3 2024 (Q-1)Q4 2024 (Current)Trend
Bridal normalizationEngagement softness; decision time elongating; multiyear normalization expected Encouraging sequential improvement in engagement bookings; still normalizing Best YoY engagement units comp of the year; strength below $5K price point Gradual normalization with mix downshift
Fine jewelry momentum+29% bookings; big gifting moments (Mother’s/Father’s Day) Strong fine jewelry growth into holiday period Strong double‑digit bookings; Dec fine jewelry 27% of bookings Strengthening; larger mix in peak periods
Gross margin driversHigh‑50s medium‑term target; optimization engine; brand mix 60.8% GM; drivers reiterated 59.6% GM; same drivers; guide to high 50s FY25 Sustained high‑50s to ~60%
Marketing efficiencySlight leverage; disciplined, data‑driven Leverage ~10 bps; balanced with brand investments Leverage ~340 bps YoY in Q4; plan to continue leverage in 2025 Improving leverage
Showrooms/omnichannelFleet enhancements; showrooms drive metro uplift Reached 40 showrooms incl. NYC Nolita 40 showrooms; expanded try‑on bar; more openings planned (2–3 in 2025) Continuing expansion
Macro/promotionalElevated discounting in industry; brand protection focus Promotional intensity persists; price optimization offsets Holiday highly promotional; maintained premium positioning Persistent headwind managed via pricing

Management Commentary

  • “We not only hit the high end of our net sales expectations but also delivered Q4 profitability that far surpassed our guidance, marking our 14th consecutive quarter of profitability as a public company.” — CEO Beth Gerstein .
  • “Q4 gross margin was 59.6%… driven by our premium brand and proprietary products, our price optimization engine, procurement efficiencies and our enhanced extended warranty program.” — CFO Jeff Kuo .
  • “Black Friday was our biggest day of bookings in company history.” — CEO Beth Gerstein .
  • “We expect [FY25] revenue growth will be back‑half weighted… and a little more than 2/3 of our adjusted EBITDA will come from H2.” — CFO Jeff Kuo .

Q&A Highlights

  • Gross margin outlook: guided to “high 50s” for 2025, supported by brand strength, proprietary product, pricing engine and procurement efficiencies; applies across engagement, wedding and fine jewelry .
  • Repeat orders/new customers: strategy to drive repeat via compelling assortments (e.g., Jane Goodall collection), curated fine jewelry, superior showroom experience; acquisition driven by data‑driven marketing and social/influencer “big social moments” .
  • Mix/AOV: strength below $5K price point in bridal; management expects AOV to moderate over time with fine jewelry growth .
  • Showroom rollout and margins: deliberate expansion with focus on experience and ROI; investments continue while maintaining profitability discipline .
  • Cadence: back‑half weighted revenue and EBITDA in 2025 due to investments, showroom annualization, and seasonal fine jewelry strength .

Estimates Context

  • S&P Global consensus for Q4 2024 revenue and EPS was unavailable at the time of analysis due to request limits. Company reported actuals: revenue $119.5M and GAAP diluted EPS $0.02 (adjusted $0.04) and cited results at high end of internal net sales guidance with profitability exceeding guidance .
  • For modeling, align FY 2025 assumptions to: revenue +1–3% YoY, adjusted EBITDA margin 3–4%, gross margin “high 50s,” back‑half weighted cadence; expect AOV moderation with fine jewelry mix, offset by order growth and marketing leverage .

Key Takeaways for Investors

  • Mix shift continues: order growth (+10% YoY) and repeat strength (+18% YoY) offset AOV declines (−12.8% YoY) from sub‑$5K bridal and fine jewelry; margin resilience underlines pricing power and brand strength .
  • Profitability execution ahead of plan in Q4; however, FY25 adjusted EBITDA margin guide (3–4%) implies near‑term investment phase vs FY24 actual 5.0% margin—watch for H2 operating leverage realization .
  • Gross margin should remain in the high‑50s, supported by proprietary product, pricing engine and procurement efficiencies, even amid a promotional industry backdrop .
  • Fine jewelry is a durable growth vector (Dec share 27% of bookings, record), expanding lifetime value and repeat behavior; showroom format enhancements (try‑on bars) support omnichannel conversion .
  • Liquidity/cash: $161.9M cash and net cash ~ $106M provide flexibility for brand, tech, and showroom investments (and selective buybacks) without stressing the balance sheet .
  • ESG/brand halo: Mission Report highlights SBTi-validated net‑zero targets and high‑profile partnerships (Jane Goodall), reinforcing premium brand positioning and differentiation with values‑driven consumers .

Financial Results Detail (company-furnished metrics)

  • Q4 2024 highlights: Net sales $119.5M; gross margin 59.6% (+90 bps YoY); net income $2.6M; adjusted EBITDA $6.9M (5.8% margin); total orders 58,357 (+10.2% YoY); AOV $2,048 (−12.8% YoY) .
  • FY 2024 highlights: Net sales $422.2M; gross margin 60.3% (+270 bps YoY); adjusted EBITDA $21.1M (5.0% margin) .

Additional Relevant Press Releases (Q4 2024 timing)

  • Mission Report (Mar 12, 2025): SBTi validation of net‑zero targets; launch of Jane Goodall Collection; expanded Fairmined gold initiatives—strengthening sustainability and brand equity narratives .
  • Earnings announcement scheduling (Feb 19, 2025): confirmed Q4/FY 2024 release and call logistics .