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- **Revenue Growth**: 15.2% YoY to $221.7M, driven by 20% retail growth and 13% glasses unit expansion.
- **AI Innovation**: Partnering with Google and Samsung to launch AI glasses, with upgraded labs supporting future fulfillment.
- **Margin Expansion**: Adjusted EBITDA up 50% to $25.7M (11.6% margin), with 260bps YoY expansion.
- **Store Expansion**: 15 new stores opened, including 5 Target shop-in-shops, bringing total to 313.
- **Guidance**: Full year EBITDA $98-101M (11.3-11.6% margin), Q4 EBITDA $18-21M (9.2% margin).
- **Challenges**: Mix shift to $95 frames, contacts growth deceleration to 21% YoY.


**【CEO Summary Section】**
- **Q3 Revenue Growth**: 15.2% YoY to $221.7M, driven by 20% retail revenue growth and 13% glasses unit growth. Adjusted EBITDA rose 50% to $25.7M (11.6% margin), despite macro challenges.
- **Customer Dynamics**: Resilient progressives customers offset mix shift to $95 frames, weighing on ASP. Contacts growth decelerated to 21% YoY amid macro softness.
- **AI Innovation**: Partnering with Google and Samsung to develop AI glasses, with first products expected in coming months. Upgraded optical labs to support future AI-driven fulfillment.
- **Store Expansion**: Opened 15 new stores (313 total), including 5 Target shop-in-shops. Suburban densification strategy continues, with 88% of stores now offering eye exams.
- **Long-Term Vision**: Aiming for 20%+ EBITDA margin through disciplined cost control, AI-driven efficiency, and omnichannel expansion.

**【CFO Financial Commentary】**
- **Top Line**: E-commerce frame sales grew 3.2% YoY, offsetting Home Try-on sunset. Contacts (11.5% of revenue) and eye exams (6.5% of revenue) showed strong growth.
- **Gross Margin**: 54.2% (down 40bps YoY) due to tariffs and contacts mix. Eye exam margin improved from 2024 inefficiencies.
- **Expense Control**: Adjusted SG&A at 48.7% of revenue (-360bps YoY), driven by 3% non-marketing SG&A growth. Marketing spend at 13.1% of revenue.
- **Cash Flow**: $36M year-to-date free cash flow, with 2025 expected to be third consecutive year of positive FCF.
- **Guidance**: Full year net revenue $871-874M (13% YoY), EBITDA $98-101M (11.3-11.6% margin). Q4 EBITDA $18-21M (9.2% margin).

**【Q&A Highlights】**
- **Mix Shift**: Younger customers gravitating to $95 frames, while progressives (22.3% of Rx units) remain resilient. No trade-down from lens price increases.
- **AI Impact**: Using AI for design, customer engagement (e.g., Advisor tool), and content creation. Early AI adoption driving 200+ basis points of EBITDA margin expansion.
- **Store Strategy**: Targeting suburban markets with 1-2 stores. Shop-in-shops performing in line with expectations, with 5-10 more planned for 2026.
- **Doctor Retention**: 60% of store leaders promoted internally. Doctors value clinical tools, culture, and technology (e.g., Point of Everything system).
- **Tariff Mitigation**: Supplier diversification and selective price increases offset $10M+ annual impact.


Warby Parker Inc. (WRBY) Q3 2025 Earnings Call Transcript

- **Revenue & Growth**: Q2 revenue up 14% YoY to $214.5M, with 19% retail growth and 2.6M active customers (9% YoY). ARPC +4.6% to $316.
- **Strategic Wins**: 300th store, first Target shops, 20M+ glasses donated. AI glasses partnership with Google announced.
- **Financial Strength**: EBITDA margin +130bps to 11.7%, free cash flow $24M. FY25 guidance raised to $880-888M revenue.
- **Operational Shifts**: Ended home try-on program, launched AI-driven 'Advisor' tool, and reallocated marketing spend.
- **Tariff Mitigation**: 80%+ supply out of China, selective price increases, and 360bps SG&A leverage.
- **Long-Term Drivers**: Contacts (11.5% of revenue vs 20% industry avg), progressives (23% of prescriptions), and AI glasses partnership.

**【CEO Summary Section】**
- **Revenue Growth**: Q2 revenue of $214.5M, up 14% YoY, driven by 19% retail growth and 2% e-commerce. Active customers reached 2.6M (9% YoY), with ARPC up 4.6% to $316.
- **Strategic Milestones**: 300th store opened; first Target shop-in-shops launched. 20M+ pairs distributed via Buy One Give One program.
- **AI Innovation**: Partnership with Google to develop AI-powered glasses, targeting all-day use with Gemini AI integration.
- **Store Expansion**: 11 new stores in Q2, 42 net over 12 months. 87% of stores now offer eye exams.
- **Product Performance**: Glasses +11% YoY, contacts +28%, eye exams +44%. Progressives account for 23% of prescription units.
- **Operational Shift**: Sunset of home try-on program, reallocating costs to brand awareness and acquisition. Launched AI-driven 'Advisor' tool for e-commerce.

**【CFO Financial Commentary】**
- **Financial Highlights**: Adjusted EBITDA of $25M (11.7% margin), up 130bps YoY. Free cash flow $24M, ending Q2 with $286M cash.
- **Gross Margin**: 54.3% (mid-50s guidance), impacted by tariffs and contact lens growth.
- **Cost Control**: Non-marketing SG&A down 360bps YoY to 36.7% of revenue. Total SG&A 48.9% vs 52.2% YoY.
- **Tariff Mitigation**: Shifted 80%+ supply out of China, selective price increases, and disciplined expenses.
- **Updated Guidance**: FY25 revenue $880-888M (+14-15%), EBITDA $98-101M. Q3 revenue $223-225M, EBITDA $24-25.5M.

**【Q&A Highlights】**
- **Customer Health**: Stable demand despite macro challenges; 50%+ retention over 24 months, 100%+ over 48 months.
- **AI Impact**: Google partnership to launch AI glasses, leveraging Warby's retail network and Google's AI ecosystem.
- **Target Shops**: Positive early feedback; 5 stores opened in August, with plans to expand into new markets.
- **Price Increases**: Minimal impact on mix; higher-value add-ons outperformed expectations.
- **Insurance Growth**: In-network insurance customers spend 2x more, with multiyear utilization trends.
- **Contacts & Progressives**: Contacts at 11.5% of revenue (20% industry avg); progressives at 23% vs 40% market share, driven by store expansion.
- **Transition Leadership**: Steve Miller departing after 14 years; Dave Gilboa interim CFO.


Warby Parker (WRBY)-7 Aug 25-2025 Q2 Earnings call transcript

- **Revenue Growth & Profitability**: 12% YoY revenue growth to $223.8M, first GAAP net income, 13.1% EBITDA margin.
- **Tariff Mitigation Success**: 70% of $45M-$50M impact already offset via supply chain, pricing, and cost control.
- **E-commerce Acceleration**: 5.5% YoY growth driven by 25% contact lens and 40% eye care expansion.
- **Key Trends**: 8.7% YoY active customer growth, 4.8% ARPC increase, 35% store 4-wall margin.
- **Tariff-Neutral Outlook**: Full year EBITDA margin expected to expand 100-150bps despite 200-300bps gross margin headwind.

**【CEO & Co-CEO Strategic Overview】**
- Q1 2025 revenue grew 12% YoY to $223.8M, driven by 8.7% YoY active customer growth and 4.8% YoY increase in ARPC to $310.
- Achieved first quarter of positive GAAP net income as a public company with adjusted EBITDA margin of 13.1% (vs. 11.2% YoY).
- Tariff mitigation strategy includes: 
  1. Shifting 50% of China-sourced COGS to <10% of total by year-end
  2. Selective price increases on ~low single-digit of glasses business
  3. $45M-$50M tariff impact mitigation through supply chain, pricing, and expense control.

**【CFO Financial Highlights】**
- Q1 2025 financials: 
  - Revenue: $223.8M (+12% YoY)
  - Adjusted EBITDA: $29.2M (13.1% margin)
  - Free cash flow: $13.2M
  - Cash balance: $265M
- FY25 guidance: 
  - Revenue: $869M-$886M (13%-15% growth)
  - Adjusted EBITDA: $91M-$97M (10.5%-11% margin)
- Gross margin expected to face 200-300bps headwind due to tariffs, partially offset by cost control and pricing.

**【Q&A Key Takeaways】**
1. **Tariff Impact & Mitigation**: 
   - 70% of tariff impact already mitigated through supply chain shifts
   - Price increases have maintained conversion rates and product mix
   - $45M-$50M tariff exposure expected to be fully offset
2. **E-commerce Growth**: 
   - Q1 e-commerce grew 5.5% YoY (highest since 2021)
   - Driven by contact lens (+25%) and eye care (+40%) expansion
3. **Target Partnership**: 
   - 5 shop-in-shops expected H2 2025
   - Same store design, staffing, and POS as standalone stores
4. **Consumer Behavior**: 
   - Resilient demand despite macro volatility
   - Insurance customers spend 2x more and have higher retention
5. **Marketing Efficiency**: 
   - Low-teens marketing spend as % of revenue
   - AI-powered personalization tests showing early success

Warby Parker Inc. (WRBY) Q1 2025 Earnings Call Transcript

- **Revenue Growth**: 15.2% YoY to $771.3M, with Q4 up 17.8%. 2025 targets 14-16% growth.
- **Margin Expansion**: 9.5% EBITDA margin (170bp YoY), targeting 11% in 2025.
- **Customer Growth**: Active customers +7.8% YoY, driven by 12.9% marketing spend.
- **Product Innovation**: First rimless frames at $195, AI-powered virtual try-ons, and 36% contacts growth.
- **Channel Expansion**: 45 new stores in 2025, including 5 Target shop-in-shops.
- **Risk Mitigation**: 20-40bp tariff headwind offset by product mix and sourcing diversification.


**【CEO & Co-Founder Overview】**
- **2024 Performance Highlights**: Revenue grew 15.2% YoY to $771.3M, with 17.8% Q4 growth. Adjusted EBITDA rose 40% to $73.1M, driven by 170bp margin expansion to 9.5%.
- **Strategic Pillars**: 
  1. **Customer Growth**: Active customers reached 2.51M (7.8% YoY), with Q4 showing 6th consecutive quarter of accelerating growth.
  2. **Product Innovation**: Introduced 20+ frame collections, including first rimless styles at $195, and expanded lens options (e.g., anti-fatigue, blue light filters).
  3. **Channel Expansion**: Opened 41 new stores (total 276), with 86% offering eye exams. 2025 plans include 45 new stores (5 in Target shop-in-shops) and 36%+ growth in contacts business.
- **2025 Outlook**: Target $878-893M revenue (14-16% growth), 11% EBITDA margin, and continued investment in marketing (low-teens % of revenue) and AI-driven e-commerce tools.

**【CFO Financial Breakdown】**
- **Q4 2024 Results**: 
  - Revenue: $190.6M (17.8% YoY), with retail up 23.9% and e-commerce +5.3%.
  - Gross Margin: 54.2% (flat YoY), benefiting from progressive lens growth and lab efficiencies, offset by contact lens expansion (10.5% of revenue).
  - SG&A: 54% of revenue, with marketing spend at 12.9% (vs. 12.5% YoY), balanced by 280bp non-marketing expense leverage.
- **2024 Full Year**: 
  - Gross Margin: 55.5% (170bp expansion), driven by higher-margin lens types and 35%+ store 4-wall margins.
  - Free Cash Flow: $35M (vs. $7M YoY), supporting $254M cash balance.
- **2025 Guidance**: 
  - Gross Margin: Mid-50s (20-40bp headwind from tariffs).
  - Store Productivity: 35%+ 4-wall margins, 20-month payback period.
  - Contact Lens Penetration: Targeting 20% of optical market (currently 10% of revenue).

**【Q&A Key Takeaways】**
1. **Customer Acquisition Strategy**: 
   - Marketing spend efficiency (12.9% of revenue in Q4) driving 7.8% YoY active customer growth.
   - Insurance partnerships (e.g., Versant Health) adding 30M+ in-network lives, with utilization tracking ahead of prior carrier integrations.
2. **Target Partnership**: 
   - 5 shop-in-shops to test omnichannel convenience, leveraging Warby's vertically integrated supply chain.
   - Potential for scaling based on customer feedback and performance metrics (e.g., traffic, conversion).
3. **AI & E-Commerce**: 
   - AI-powered virtual try-on tools (75% iOS adoption) driving 12% YoY glasses growth.
   - 2025 plans include personalized recommendation engines to replicate in-store experience online.
4. **Tariff Mitigation**: 
   - 20%+ sourcing outside China, with 20-40bp gross margin impact hedged by product mix optimization.
5. **Long-Term Vision**: 
   - 900+ store target (vs. 276 current), with 75% of optical purchases made at exam locations.
   - Addressing myopia growth (50%+ global prevalence by 2050) through accessible, high-quality care.


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