Honest Company Q3 revenue beats estimates as wipes and personal care products grow
Overview
US personal care products maker's Q3 revenue fell 8.6% but beat analyst expectations
Q3 adjusted EBITDA beat analyst estimates
Company announced new $30 mln share repurchase program and raised full-year 2026 outlook
Outlook
Honest Co raises 2026 revenue outlook to $322 mln-$325 mln from $319 mln-$325 mln
Company now expects 2026 organic revenue growth of 6%-7%, up from 5%-7%
Honest Co sees 2026 adjusted EBITDA of $25 mln-$26 mln, up from $23 mln-$25 mln
Result Drivers
PRODUCT MIX SHIFT - Growth in wipes and personal care products, partially offset by a decline in diaper revenue, drove organic revenue increase, per company
STRATEGIC EXITS - Revenue decline attributed to strategic exits under Powering Honest Growth and diaper revenue declines, per company
MARGIN IMPROVEMENT - Gross margin expansion primarily driven by favorable supply chain rates, product mix, and improvements related to strategic exits, per company
Company press release:
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q3 Revenue | Beat | $84.61 mln | $80.79 mln (6 Analysts) |
Q3 Net Income | $91.32 mln | ||
Q3 Adjusted EBITDA | Beat | $6.3 mln | $2.56 mln (6 Analysts) |
Q3 Gross Margin | 45.00% |
Analyst Coverage
The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 4 "strong buy" or "buy", 2 "hold" and 1 "sell" or "strong sell"
The average consensus recommendation for the miscellaneous specialty retailers peer group is "buy."
Wall Street's median 12-month price target for The Honest Company, Inc. is $5.00, about 12.6% above its November 4 closing price of $4.44
The stock recently traded at 38 times the next 12-month earnings vs. a P/E of 43 three months ago
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For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.
(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)