Tokyo Lifestyle Co., Ltd. Q2 FY2025 earnings call

• The company reported total revenue growth of 22.1% to $98 million for the six months ended September 30, 2024, driven by the expanding franchise network and dedicated wholesale customer base.
• Adjusted business strategies to optimize resource allocation, enhance operational efficiency, and drive profitability, including transitioning underperforming directly operated physical stores into franchise stores and closing underperforming online stores.
• Global market expansion with the partial offset of revenue decline in Japan and Hong Kong through the renewal of directly operated stores in the United States and Canada.
• Received a Gold Stevie Award in the Company of the Year Retail Medium Size category at the 21st Annual International Business Award in September 2024.
• Strengthening collaboration with existing franchises in Asian markets and actively seeking new partnerships to drive further development.
• Actively exploring opportunities in global markets and new business sectors, such as opening a new Reiwatakiya Store in Las Vegas, launching an online platform in the U.K. and Canada, and forming a joint venture for a retail business.
• Focused on strategic priorities including strengthening market footprint, monitoring market trends, improving operational efficiency and profitability, optimizing distribution network, and exploring new partnership opportunities.

In the first-six months of fiscal year 2025, the franchise and wholesale business line demonstrated significant growth with revenue increasing by 53.8% to $86.9 million, accounting for 88.7% of the total revenue of $98 million. The directly operated store and online sales channels contributed $11 million in revenue despite challenging market conditions.

• Remain committed to driving sustainable growth and exploring new opportunities while strengthening loyalty among existing customers.
• In Asian markets, strengthen collaboration with existing franchises and seek new partnerships to drive development.
• Actively explore opportunities in global markets and new business sectors.
• Remain focused on strategic priorities to contribute to a bright future and deliver greater value for the company and shareholders.

• Forward-looking statements involve known and unknown risks and uncertainties. The company undertakes no obligation to update forward-looking statements to reflect subsequent events or circumstances, and actual results may differ materially from anticipated results.

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