a.k.a. Brands Holding Corp. reported third‑quarter 2025 results on November 7, 2025, with net sales of $147.1 million, a 1.9% year‑over‑year decline from $150.1 million in Q3 2024. Adjusted EBITDA stood at $7.0 million, down from $7.6 million in the same quarter last year, while the adjusted EBITDA margin fell to 4.8% from 5.0% YoY. Gross margin improved to 59.1% from 58.0% in the prior quarter, reflecting stronger pricing power and cost‑control measures in the supply chain.
The 1.9% drop in revenue reflects a modest softening in demand for the company’s core apparel lines, which have faced increased competition and price sensitivity in the U.S. market. While the company’s accessories and footwear segments saw modest growth, the overall decline was driven by lower volume in the flagship apparel category, offsetting gains in other product lines.
Gross margin expansion to 59.1% was driven by higher average selling prices and a shift toward higher‑margin product mixes. However, the compression of the adjusted EBITDA margin to 4.8% from 5.0% YoY was largely due to higher operating expenses, including increased marketing spend and investment in new retail locations. The company’s cost‑control initiatives were insufficient to offset the margin pressure from these higher expenses.
Earnings per share for the quarter were $‑0.44, matching the consensus estimate of $‑0.44. The flat EPS result indicates that the company’s operating performance was in line with analyst expectations, despite the decline in revenue and margin compression.
Full‑year guidance remains unchanged: net sales are projected at $598–$602 million and adjusted EBITDA at $23–$27.5 million. The guidance reflects management’s confidence in stable demand and the continued impact of the company’s debt‑refinancing program, which has reduced interest expense and improved liquidity. The company also highlighted the opening of a new Princess Polly store at The Westchester mall and an improvement in inventory levels, both of which are expected to support future cash flow.
The earnings release underscores a mixed outlook: while the company has strengthened its balance sheet and improved gross margin, it faces headwinds from softer apparel demand and higher operating costs. Management’s focus on inventory discipline and strategic retail expansion signals a cautious but forward‑looking approach to sustaining profitability in a competitive environment.
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