Olaplex Sales Drop But Beat Expectations

In its third-quarter earnings announced on Thursday, Olaplex’s net sales decreased 3.8 percent to $114.6 million, with the biggest losses in its speciality retail division, which declined 13.5 percent alongside a 14.6 percent drop in its US business, after growing in the five of the last six quarters. However, the overall decline beat Wall Street expectations, which had predicted a loss of closer to 6 percent. The company’s outlook had predicted a “high single digit” decline.

Amanda Baldwin, the company’s chief executive, told The Business of Beauty the narrowing loss was thanks to success overseas — its international sales increased 7.1 percent — and well-timed product innovation, citing the success of its recent hair mask launch, the Weightless Nourishing and Rich Hydration Masks, both $44.

“Around [this time last year] was when I started to speak to people about what we needed to do in order to reset that [international] business,” said Baldwin. “We’re now putting markets into place, building relationships and sending our teams to train those partners.” She added that masks were easily understood and widely used by consumers, and that Olaplex had not meaningfully had a presence in the category before.

The firm has also beefed up its investments in the professional channel with a goal of reengaging stylists and colourists. “We’ve really leaned into a ‘pro-first’ mentality,” said Baldwin. She also said the company is investing in new markets or untapped areas within day-long education events for local hair professionals.

Olaplex reaffirmed its fiscal year guidance, originally stated in March, which had predicted a high single digit decline in the third quarter, and a high single digit increase in the fourth quarter. It has beat its own guidance in each quarter of the fiscal year so far.

“When we get the KPIs right, we’re able to move the needle,” said Baldwin.

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