The Beauty Health Co. Q1 FY2025 earnings call

• Marla Beck noted a strong start to the year, exceeding revenue and adjusted EBITDA guidance. - Strategic priorities include enhancing commercial execution (refined sales structure, China distribution transition, flexible pricing), accelerating science-backed innovation (new boosters, treatment tips, back bar initiative, dedicated skin care line), and deepening provider partnerships (U.S. loyalty program relaunch, brand/consumer engagement campaigns). - Production in the U.S. was consolidated in Q4 to improve quality, agility, and reduce tariff exposure.

Consumables grew over 8% in the first quarter and now represent over 70% of revenue. Total active devices in the field increased to over 35,000 units. Device sales saw a 43.5% year-over-year decline due to macroeconomic pressures on equipment purchasing. Consumable net sales increased 3.5% in the Americas, 42.6% in APAC, and 7.9% in EMEA.

• Full year 2025 sales guidance: $270 million to $300 million; adjusted EBITDA guidance: $15 million to $25 million. - Second quarter 2025 sales projection: $71 million to $76 million; adjusted EBITDA projection: $2 million to $4 million. - Guidance assumes no material deterioration in general market conditions beyond the company's control.

• Tariffs: Expected $5 million impact in 2025, with the situation remaining fluid. - Macroeconomic pressures: Continued impact on equipment sales and potential uncertainty in the global market affecting regional performance.

Q: Perspective on profitability for the year and potential upside to full year guide, plus end consumer strength.

A: Mike Monahan mentioned slight improvement in back half of 2025 with initiatives like lower-priced equipment. Marla Beck noted strong consumable sales, with core treatments growing but some softness in luxury treatments.

Q: Color on consumables, new launches like Hydralock, and APAC region.

A: Marla Beck said Hydralock drives traffic. Mike Monahan noted APAC consumable improvement, especially in China with less discounting.

Q: Gross margin strength, sustainability, and tariffs impact.

A: Mike Monahan said gross margin was strong due to supply chain efficiency, but expected step down in Q2 and rest of year due to higher equipment purchases and tariff impact.

Q: Terminal mix of consumables, region trends, attach rate.

A: Mike Monahan said no targeted mix, but APAC and China face pressure due to tariffs.

Q: Consumer demand dynamics, medical vs health beauty.

A: Marla Beck said dermatology/wellness sectors strong, day spas/plastic surgery practices less so.

Q: Marketing spend, tactics, and flexing for bottom line.

A: Mike Monahan said held sales/marketing as % of revenue, focusing on provider and consumer pull-through.

Q: China distributor model shift, tariff impact net of mitigating actions, competition.

A: Mike Monahan said China distributor transition far along. Tariff impact not fully passed through. Marla Beck said Beauty Health is category leader with high market share and consumer NPS.