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• Net Sales: $575 million for fiscal 2024, a 5.2% increase over the prior year.

• US Net Sales Growth: 17% increase, highlighting strong performance in the largest market.

• Gross Margin: Improved by 200 basis points to 57% for the year.

• Adjusted EBITDA: $23.3 million, a 69% year-over-year growth.

• Fourth Quarter Net Sales: $159 million, a 6.8% increase year-over-year.

• Fourth Quarter Gross Margin: 55.9%, up 460 basis points from the previous year.

• Fourth Quarter Adjusted EBITDA: $6.2 million, with a margin increase of 300 basis points to 3.9%.

• Active Customer Base: 4.07 million, a 9.4% increase year-over-year.

• Average Order Value: $78 in the fourth quarter, a 2.6% increase year-over-year.

• Cash and Cash Equivalents: $24.2 million at the end of the fourth quarter.

• Debt: $111.7 million at year-end.

• Inventory: $95.8 million, a 5% increase compared to the previous year.

• 2025 Sales Outlook: $600 million to $610 million, representing 4% to 6% growth.

• 2025 Adjusted EBITDA Outlook: $27.5 million to $29.5 million, an 18% to 27% growth.

• Capital Expenditures for 2025: $12 million to $14 million, primarily for opening seven new stores.

• Warning! GuruFocus has detected 5 Warning Signs with AKA.

Release Date: March 06, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• a.k.a. Brands Holding Corp (NYSE:AKA) achieved a significant milestone by stabilizing the business and returning to growth, with net sales of $575 million, a 5.2% increase over the prior year.

• The company saw impressive 17% net sales growth in the US, its largest market, highlighting the strength of its brands.

• a.k.a. Brands expanded its omnichannel initiative, opening five Princess Polly stores and enhancing wholesale partnerships with retailers like Nordstrom.

• The company improved its gross margin by 200 basis points to 57% due to stronger full-price sales and high-quality merchandise.

• Adjusted EBITDA grew significantly by 69% year over year, reaching $23.3 million, demonstrating strong financial performance and strategic execution.

Negative Points

• Sales in Australia and New Zealand declined by 9.6% in the fourth quarter compared to the previous year, indicating regional challenges.

• Net sales in the rest of the world region declined by 13.5% year over year, showing weakness outside the US market.

• Marketing expenses increased to $22.3 million, up from $17.3 million in the fourth quarter of 2023, impacting overall profitability.

• General and administrative expenses rose to $24.9 million due to increased incentive compensation and non-routine legal matters.

• The company faces an approximate $10 million FX headwind in its 2025 net sales outlook, which could impact financial performance.