The Honest Company, founded by movie star Jessica Alba, posted its second-quarter results Wednesday (Aug. 8), which showed a revenue bump from recent retail distribution deals.
The Honest Company Inc. said financial results for the second quarter ending June 30 showed revenue increasing 8%, digital revenue increasing 10%, and retail revenue increasing 5%.
On the earnings call with analysts, CEO Carla Vernon said the “omnichannel performance reflected recent retail distribution wins, robust tracked channel consumption, as well as strong purchases by our key digital retailer. Some highlights this quarter include a continued strong performance at Target, which saw high single-digit consumption growth versus a year ago, double-digit point of sales growth across diapers, wipes, and beauty items at Amazon, and continued strength at Walmart, following our launch in the second half of 2022, as well as new distributions secured this year.”
Net loss for the second quarter was $13 million, which was in line with the company’s expectations. Inventory was reduced by 17%, according to the company.
Regarding pricing, the company has revised its pricing structure to align it with the premium ingredients featured in its products. Vernon said the company also “exited Asia and Europe, which significantly reduces the complexity in our business model. These actions will improve our margin structure.”
The company also aims to generate improvement and growth in regard to the top-selling products that have remained around 30% Average Cost Values (ACV). Vernon addressed this stating, “We call them our hero items. So first and most importantly, what we’re excited about is that our hero items are performing so strongly where they are. Our strong performance opens up the opportunity to have really good conversations about the growth we can drive on those existing shelf sets by expanding distribution of our top items. We are in conversations with retailers about that strategy.”
Shares of the company were up slightly for the day and traded at $1.41 in after-hours trading.
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