Adore Beauty posts record revenue as omnichannel pivot reshapes the business
In its FY26 results presentation dated 24 August 2026, Adore Beauty Group reported record total revenue of $207.3M, up 4.3% on the prior corresponding period (PCP), delivered during what management described as the most significant investment cycle in the company’s 26-year history.
Underlying EBITDA of $3.8M, at a 1.8% margin, was broadly in line with the company’s May-26 guidance. Management framed FY26 as a transitional year, with a reduction in earnings impacted by a tempered retail environment and heavy spending on the store network, a new National Distribution Centre (NDC) and a new enterprise resource planning (ERP) system.
The presentation positioned the shift from a pure-play online retailer to an omnichannel model as central to the strategy, with 13 new stores opened during the year. A challenging trading environment dampened second-half performance, yet management guided to a material step-up in revenue and profitability in FY27.
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FY26 by the numbers
The group summary presented across the results highlighted revenue growth alongside a compressing margin and a sharp lift in store contribution.
| Metric | Value | Change |
|---|---|---|
| Total revenue | $207.3M | +4.3% |
| Gross profit margin | 34.8% | -52bps |
| Underlying EBITDA (pre-AASB 16) | $3.8M | 1.8% margin |
| In-store revenue | $18.6M | +490% |
| New customers | 418.6K | +14.4% |
| Active customers | 858.8K | +2.6% |
Management outlined several standout achievements from the year:
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13 new stores opened (11 Adore Beauty, 2 iKOU), taking the national network to 20 stores, with 5 additional leases secured for H1 FY27.
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Owned brands, led by iKOU, delivered double-digit growth and now contribute 5.8% of Group product revenue.
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Customer acquisition cost (CAC) spend fell 37.4% over the year.
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Omnichannel customers now represent 9.6% of Group revenue.
The omnichannel engine: why stores are changing the customer economics
The decision by a former online-only retailer to invest in physical stores sits at the heart of the FY26 strategy. An omnichannel (or “omni”) customer shops both online and in-store, and management detailed why these customers are considerably more valuable to the business.
According to the presentation, omni-channel customer lifetime value (LTV) is 2.5x higher than online-only, with omni spend per customer 52% higher than online-only in FY26. Stores were described as a higher-margin, less promotionally driven channel, improving the quality of earnings.
Management also pointed to a “halo” effect, where online sales lift in the catchments around new stores. This effect was described as strongest where the existing customer base is underpenetrated, with Broadway NSW noted as the network’s best-performing store and WA, QLD and SA all outperforming VIC.
Investors should understand the earnings drag that accompanies a young store network. Stores are expected to reach operational maturity 18 to 24 months after opening. The retail channel recorded a $1.1M underlying EBITDA loss in FY26, with more than half the network less than a year old. Management said the network is not expected to be a material impost on profitability in FY27.
Key operational metrics presented included:
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In-store traffic: 1.4m
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In-store conversion: 17.4% in H2 FY26, up 429bps
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Omni-channel revenue: 11.9% in H2 FY26, up from 5.2% in H1
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National flagship store (Melbourne CBD) opening Sept-26
A transitional year for earnings behind the record revenue
The presentation explained the decline in earnings against rising revenue as the outcome of a deliberate investment cycle rather than a deterioration in the underlying business.
| A$M | FY26 | FY25 | Change |
|---|---|---|---|
| Revenue | 207.3 | 198.8 | +4.3% |
| Gross profit | 72.1 | 70.2 | +2.7% |
| Gross margin | 34.8% | 35.3% | (52bps) |
| Underlying EBITDA | 3.8 | 6.2 | -39.3% |
| Underlying EBIT | (0.2) | 4.1 | -103.7% |
Management noted that gross margin remains 134bps ahead of FY24, and that the H2 FY26 margin was 18bps ahead of PCP, supported by owned brands, retail media and stores.
Marketing discipline featured prominently. Marketing and advertising spend fell 22.8% to $18.4M, marketing as a percentage of sales declined 316bps to 8.8%, and return on ad spend (ROAS) rose to 14x from 9x.
The balance sheet reflected the funding of the investment cycle:
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Cash of $0.7M, down from $12.7M
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Group net debt of $9.3M
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Undrawn facilities of $14.4M
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Working capital facility refinanced and increased to $17M
Infrastructure built for scale: the new NDC and ERP
The presentation detailed the operational backbone investments delivered during the year and the efficiency payoff management expects investors to watch for.
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A new semi-automated 6,300sqm National Distribution Centre, described as first of its kind in ANZ, with 7+ years of capacity and an efficiency ramp-up from Q2 FY27.
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Forecast $2M in annual labour savings, with capex of approximately $8M split over FY26/FY27, largely funded by a project-backed facility from CBA and a forecast payback in under four years.
The NDC capex was largely funded through a project-backed facility from CBA, and the broader CBA debt facility refinancing completed in June 2026 lifted the group’s total credit limit to $25.2M, splitting into a $17M working capital facility and an $8M asset-backed loan tied specifically to the new distribution centre.
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A new ERP rollout completed on budget and schedule.
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A reshaped head office team targeted to deliver more than $2.5M in annualised cost efficiencies.
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AI deployed across the business (‘Ask Aura’, ‘Abi’, ‘Dora’), alongside a partnership with Google to launch its agentic retail Universal Commerce Protocol in Australia.
iKOU: the owned-brand growth story
Management positioned iKOU as the higher-margin owned brand driving double-digit growth across the group.
Active customers rose 49.8% to 35.4k, with stores now accounting for 45.5% of new customers. The retail network stands at six stores across NSW and VIC, with a Hobart store opening in H1 FY27 and the Berry store including iKOU’s first day spa facility.
The company is establishing a partnership for entrance into Asia during FY27, with its first loyalty program launching in Q1 FY27 and a digital wholesale sales platform in Q2 FY27.
FY27 outlook: management targets a material step-up
The forward guidance set out in the presentation anchored the investment case, with management targeting a material step-up in both revenue and profitability.
| FY27 Target | Value |
|---|---|
| Revenue growth | ≥10% |
| Underlying EBITDA (pre-AASB 16) | $9–13m |
Management cited several drivers behind the targeted step-up: annualisation and maturation of the 20-store network, the iKOU brand reset alongside its loyalty launch and wholesale partners, improved brand terms and retail media growth, and CODB savings from the NDC, ERP, HQ restructure and a new freight partner.
FY26 delivered record revenue of $207.3m and underlying EBITDA of $3.8m. Despite the challenging economic environment, the Group is targeting a material step-up in revenue and profitability in FY27 with revenue growth of at least 10% and Group underlying EBITDA between $9-$13 million on a pre-AASB 16 basis.
What it means for investors
FY26 stands out as an investment year in which the company delivered record revenue while building the physical foundations for its next phase. The store network, semi-automated distribution centre and new ERP were all commissioned during the period, weighing on near-term earnings.
The trade-off is captured in the numbers. Revenue rose while underlying EBITDA fell, reflecting an immature store footprint and a tempered retail environment rather than a weakening core.
The FY27 guidance signals where management expects the payoff. With revenue growth targeted at ≥10% and underlying EBITDA guided to $9–13m, the year ahead is framed as the point at which the investment cycle begins to convert into profitability.
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