Goldman Sachs Downgrades Cricut to Sell with PT $4.75 from $5.5

Goldman Sachs Downgrades Cricut to Sell with PT $4.75 from $5.5

Goldman Sachs has downgraded Cricut Inc. (CRCT) stock to a "Sell" rating with a price target of $4.75, down from the previous $5.5. This move comes after the investment bank reviewed the company's recent financial performance and market outlook. The downgrade reflects concerns about Cricut's ability to sustain growth in the face of increasing competition and market saturation, according to MarketWatch's profile of Cricut Inc. Cl A https://www.marketwatch.com/investing/stock/crct.

In the latest quarterly earnings report, Cricut reported mixed results, with revenue declining 3% to $162.6 million and net income increasing 22% to $23.9 million compared to the same period last year. While the company saw growth in paid subscribers and international revenue, the overall financial performance did not meet expectations, according to StockTitan's analysis https://www.stocktitan.net/news/CRCT/. Additionally, the company's gross margin improved to 60.5% from 54.7%, indicating cost-cutting measures to offset revenue declines.

Goldman Sachs analysts cited several factors contributing to their downgrade, including the company's dependence on a single product line, the increasing popularity of DIY crafts, and the potential impact of the global economic slowdown on consumer spending. The analysts also noted that Cricut's stock price has been volatile in recent months, with insider selling activity adding to market uncertainty .

Cricut management has been proactive in addressing these challenges, with plans to expand its product offerings, enhance its digital content platform, and enter new markets. The company has also been investing in research and development to innovate its cutting machines and materials. However, these efforts may take time to translate into improved financial performance .

Investors should closely monitor Cricut's upcoming earnings reports and management presentations at upcoming investor conferences to gauge the company's progress in addressing these challenges. The company is scheduled to announce its third quarter 2025 financial results on November 4, 2025 .