San Francisco—Brilliant Earth experienced a lackluster start to 2024, with first-quarter net sales remaining flat year-over-year.
CEO Beth Gerstein expressed satisfaction with the company’s strategic execution and market share gains. “As a growth company, I’m pleased with our continued ability to consistently execute our strategic initiatives and deliver share gains and profitability,” she said in a statement.
For the first quarter ending March 31, 2024, net sales were $97.3 million, barely changing from $97.7 million in Q1 2023. These results met the company’s projections of $96.5 million to $98.5 million in sales.
Adjusted EBITDA surpassed expectations, reaching $5.1 million, above the guidance range of $1 million to $2.5 million. Net income saw a significant increase, tripling to $1.1 million from a net loss of $1 million in the same period last year.
The company reported a gross profit of $58.3 million, reflecting a 60% gross profit margin, up from $53.7 million or a 55% margin the previous year.
Order volume rose by 14%, with repeat orders increasing by over 20%. However, the average order value (AOV) fell by 12%, attributed to rising sales of non-bridal jewelry, which typically has a lower price point.
During the May 9 earnings call, Gerstein highlighted a strong performance for Valentine’s Day, with fashion jewelry sales jumping 45% year-over-year. Top sellers included tennis bracelets, diamond studs, and heart-shaped jewelry, which saw a 182% increase in sales.
Brilliant Earth’s wedding and anniversary collections recorded double-digit sales growth, particularly the men’s wedding ring segment, which experienced high demand for textured and accented rings. Additionally, fashion ring sales soared by 75%.
Gerstein noted steady engagement ring sales despite industry challenges and heavy promotional discounting, which Brilliant Earth chose to avoid. “Our premium brand and curated proprietary assortments continue to resonate with engagement ring consumers,” she said.
Looking ahead, Gerstein expressed confidence in a multi-year recovery for engagement sales and the company’s potential to grow its market share in the premium bridal jewelry segment.
Chief Financial Officer Jeff Kuo reported strong order growth and momentum in fine jewelry and wedding bands in Q2, although engagement ring sales faced industry headwinds.
Initially an online-only business, Brilliant Earth has been expanding its physical presence. It plans to open three new showrooms in the latter half of the year, including two in Boston and its first street-level location in New York City’s NoLiTa neighborhood.
“We are beginning the year with positive momentum, and we believe we are in a great position to deliver on our strategic and financial goals for the full fiscal year,” Gerstein stated.
For fiscal 2024, Brilliant Earth maintains its forecast of $455 million to $469 million in net sales and an adjusted EBITDA of $14 million to $22 million. For Q2, the company anticipates a low-to-mid single-digit decline in net sales and a low single-digit percentage adjusted EBITDA margin.
