a.k.a. Brands Holding Corp.

Greetings. Welcome to AKA Brands holding first quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow a formal presentation. If anyone should require operator assistance during this conference, please press star zero on your telephone keypad. Please note that this call is being recorded. I will now turn the conference over to our host, Emily Schwartz, investor relations. Thank you. You may begin.

Good afternoon. Thank you for joining AKA Brands to discuss our first quarter 2025 results released this afternoon, which can be found on our website at ir.aka-brands.com. With me on the call today is Kieran Long, Chief Executive Officer, and Kevin Grant, Chief Financial Officer. Before we get started, I'd like to remind you of the company's safe harbor language. Management may make forward-looking statements which refer to expectations, projections, and other characterizations of future events including guidance and underlying assumptions. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those expressed. For further discussion of risks related to our business, please see our filings with the SEC. Please note we assume no obligation to update any such forward-looking statements. This call will also contain non-GAAP financial measures such as adjusted EBITDA and adjusted EBITDA margin. Reconciliations of these non-GAAP measures to the most comparable GAAP measures are included in the release, furnished to the SEC, and available on our website. With that, I'll turn the call over to Ciaran.

Good afternoon, everyone, and thank you for joining us today to discuss our first quarter 2025 results. I'm pleased to report that we delivered a strong start to the year with outstanding first quarter performance that reflects our team's strong execution across our brands and business. This marks our fourth consecutive quarter of growth underscoring the effectiveness of our strategic initiatives and operational discipline. Before reviewing the quarter, I want to acknowledge and thank our talented teams whose commitment to our brands and customers continue to drive our success. Their consistent performance has been instrumental in delivering the solid first quarter results and navigating the current environment. Now let me share some highlights from the first quarter. We grew net sales approximately 12% on the constant currency basis to 129 million with continued strength in the US, which grew 14%. As mentioned, this marks our fourth consecutive quarter of growth overall and the seventh consecutive quarter of growth in the US. In the Australian New Zealand region, we registered first quarter revenue growth of more than 6%. The success stems from a combination of the extensive strategic work our teams have been actioning in the region, particularly in the Culture Kings brand, leveraging our highly effective test and repeat model and an improved macro environment. We strengthen our customer connections and deliver nearly 8% growth in our active customer base over the training 12 months, underscoring that demand for our brands is strong. Our omnichannel expansion plans are on track and exceeding expectations. Princess Polly opened its seventh store in Soho in the first quarter, which was our strongest opening to date, and early reads from Princess Polly and Petal & Pup's debuts chain-wide at Nordstrom are encouraging. And rounding out the quarter, benefiting from the strong top-line growth, healthy gross margin performance, and continued operating discipline, we exceeded our profitability expectations and delivered 2.7 million of adjusted EBITDA. On the heels of a solid first quarter, I want to address the current macro environment and the uncertainty surrounding trade and tariffs. As we approach the evolving trade policies, we continue to lean into our goals of building brands for the long term, delivering high quality fashion to our customers and balancing growth and profitability. We're confident that our proactive approach, flexible business model and speed of execution will allow us to navigate through this period and position us to emerge stronger on the other side. Let me walk you through our three-pronged approach to tariffs. First, we leverage our relationships and scale with our key partners in China to agree on discounts that will allow us to share the burden of the first round of tariffs. Second, over the past six months, we've been intensely working on diversifying our supply chain. We anticipate our US business will have minimal exposure to China in the fourth quarter, with production already shifting to countries such as Vietnam and Turkey. We are making this change in combination with our existing vendors who have operations outside of China and new partners that have a global footprint. We have teammates who are working onsite in the new locations to ensure the quality of our products meets both our high standards and those of our customers. And lastly, where necessary, we have the ability to take strategic price increases carefully designed to limit impact on customer demand, uphold our commitment to accessible fashion, and protect our margins. Kevin will walk you through our outlook momentarily, but we continue to see solid demand trends in the first six weeks of the second quarter, in line with our outlook for the year. The actions we're taking to diversify our supply chain are primarily focused on our US operations. We will leverage our non-US business to maintain our long-term vendor relationships that are based in China. Longer term, this will allow us to leverage different regions as tariffs rebalance. We believe the actions we're taking will enhance our agility, resilience, and long-term competitiveness. We've faced challenges before and we're well prepared to adapt as the landscape evolves. And as we've seen in the past, we come out stronger than before. While this work is well underway, we are committed to growing our branch for the near and long term. As a reminder, building on the success of last year, we laid out three key priorities for 2025 grounded in expanding our total addressable market. First, we will attract and retain customers on our direct consumer channels through on-trend exclusive merchandising and differentiated marketing strategies. In the first quarter, our merchandising team successfully optimized our inventory mix to align with current trends and evolving customer preferences, and our innovative marketing approach deeply resonated with our customers, leading to solid growth in our direct-to-consumer channels. Second, we will expand our brand awareness through physical retail and growing wholesale partnerships. Investments in our online channel expansion continue as planned, and as mentioned, in the first quarter, Princess Polly held its grand opening for its New York store, and both Princess Polly and Petal & Pop expanded to all Nordstroms. And lastly, we remain committed to streamlining our operations and strengthen our financial foundation. I'm very proud of our ability to adapt to the rapidly changing macro environment while protecting the core of our business. We ended the first quarter with a healthy inventory position and improved operating cash compared to the same period last year. Now, let me share some highlights from our brands from the first quarter, as well as upcoming strategic goal drivers. Starting with Princess Polly, the largest brand in our portfolio, which accounts for approximately half of the portfolio's revenue, Princess Polly is a leading fashion brand known for its trend-forward styles and strong connection with its next-generation customers. With a growing digital business and expanding retail footprint, the brand continues to deliver strong performance, demonstrating its constant pulse on its customers' preferences. In the first quarter, Princess Polly's fashion-forward approach capitalized on emerging trends in classic prints such as polka dots gingham and modern animal prints dresses continue to be a leading category with emphasis on key moments including prom and graduation with the collections driving double digit revenue growth compared to last year princess polly also continues to expand its lifestyle category offerings including newer arrivals such as activewear and sleepwear as well as swim which is in a scene of significant growth year to date And heading into the back-to-school season, basics such as teeth and denim will further round out the lifestyle assortment strategy. Princess Polly's marketing success is rooted in a deep understanding of where its customers spend their time, showing up wherever they stroll, stream, or shop. In the first quarter, this customer-first approach led to early success in TikTok Shop, where the brand is blending content and commerce in fresh, innovative ways. At the end of March, Princess Polly launched a five-day campaign highlighting its new arrivals, featuring TikTok banners, a live shopping event on TikTok, and in-store activations at a Los Angeles store. The campaign exceeded revenue targets and notably more than 75% of TikTok shop orders during the quarter came from new customers. The first quarter also marked a significant period of high-impact marketing activations with the likes of an exclusive edit with influencer Ashton Earl, in-store events, and the highly anticipated Sohor store opening, which drew lines on Broadway and featured Times Square billboards and a large-scale influencer event. In addition to its strong online presence, Princess Polly is expanding its physical footprint with plans to open seven new stores in 2025, bringing the total to 13 by the year end. All existing locations are outperforming revenue expectations creating a halo effect on surrounding online markets and serving as a powerful customer acquisition channel. With each new opening, the team continues to optimize operations, enhancing inventory flow, reconfiguring store layouts to increase capacity, and broadening the assortment of new style and accessories. New stores in Florida, Ohio, and California are slated to open in the second quarter, with three additional locations in New York and Pennsylvania planned for the second half of the year. In addition to its own store rollout, Princess Polly is also leveraging wholesale partnerships to expand brand awareness. As mentioned, Princess Polly debuted in all Nordstrom stores in the first quarter, and early results are exceeding expectations in both the stores and on nordstrom.com, particularly in formal addresses. Princess Polly is also seeing an uptick in organic search from customers that have previously purchased on nordstrom.com, confirming the thesis that putting our products on multiple channels helps expand awareness and drive customer acquisition. Petal & Pup also delivered solid performance in the quarter. The brand continues to resonate with its core 25 to 40-year-old female customer through a curated assortment of feminine fashion, everyday essentials, and occasion-ready styles at accessible price points. In the quarter, during Australia's summer months, customers responded well to tropical florals and vibrant prints, while offerings in the US were tailored to capture modern feminine spring trends, including waffles and lace details. Petal & Pop's approach of launching collections in Australia before bringing successful styles to the US remains valuable, providing insight into emerging trends and improving merchandising decisions. In addition to its strength in occasion wear, Petal & Pop is also expanding its assortment to capitalize on the growing demand for basics and luxe everyday pieces, including fine knits, denim, and soft workwear details. Petal & Pox's innovative marketing and storytelling initiatives are transforming how customers are engaging with the brand, creating social narratives around tropical gateways, romantic occasions, and everyday elegance. This focus on authentic connections has driven social traffic up 6% year over year, with Pinterest inspirational boards and TikTok content such as styling videos and user-generated content bringing the brand to life. Building on the momentum, Petal & Pop is launching a TikTok shop in the second quarter, creating a seamless path from inspiration to purchase. I'm really excited that Petal & Pop's expanded omnichannel presence continues to be a driving force for the brand. As noted, Petal & Pop rolled out to all Nordstrom stores in March and we're seeing incredibly strong results out of the gate in terms of sell-through, as well as views on Nordstrom.com. Petal & Pop's high-quality styles at accessible price points tap into a white space opportunity at Nordstrom and really resonate with customers. Petal & Pop is bringing the brand to life this spring through standalone expanded branding throughout all Nordstrom stores from mid-May through June, designed to build awareness and engage new customers. They will also have four immersive pop-up shops in select Nordstroms, which will feature a branded coffee bar alongside activations with influencers and customers. In addition to this exciting expansion at Nordstrom, Petal & Pop launched new wholesale partnerships with Dillard's and Stitch Fix in the first quarter. Turning to our streetwear brands, Culture Kings and Minimal. I'm thrilled to report that the Australian New Zealand region is back to growth, driven in large part by improvements in the Culture King's business over the last 18 months. As noted on our last call, in the first quarter, we strengthened the global Culture King's leadership team with strategic hires, and the teams have already hit the ground running, optimizing the current business as well as driving strategic growth opportunities for the future. Culture King's unique differentiator in the streetwear space is its fashion-forward in-house design brands, including Lloyder, Minimal, Carré, and St. Marta. which consistently rank as best sellers in both the US and Australia. As a reminder, Culture Kings began shifting its merchandising strategy to the test and repeat approach for its in-house brands last year, and we're already seeing really strong results. In Australia, revenue for in-house brands grew over 40% in the first quarter, a testament to the power of the test and repeat model. Leading the growth in both regions is in-house brands Loiter which continue to accelerate through its fashion-forward on-trend collections, including the highly anticipated Moda launch. In addition to its in-house brands, roughly half of Culture King's assortment comprises of legacy and emerging third-party brands to complete the streetwear outfit. Culture King's continues to see meaningful growth in its collaborations with leading brands such as New Era and Asics in the US and Ed Hardy in Australia. Culture King's signature retail attainment concept comes to life through high energy marketing activations, including live music, celebrity, and athlete-hosted events, making each visit to a Culture King store a unique experience. In the first quarter, the brand hosted events in stores across both regions with partners including F1, the UFC, and the NFL, driving store traffic, viral moments across social media, and positive customer experiences. In the US, Culture Kings recently partnered with WWE during WrestleMania 41 in Las Vegas, which included an exclusive capsule collection and a large-scale in-store event with over 1,000 attendees lined up outside Culture Kings. The activation included celebrity WWE wrestlers, a cage installation, and exclusive merchandise, leading to one of the biggest sales day at the Culture Kings Las Vegas store since its grand opening. showcasing the power of the immersive brand events and cultural relevance. As mentioned last quarter, we're viewing locations for our next Culture King store in the US, and I'm confident that there is significant runway for the brand both in the US and globally. In closing, I'm proud of our strong first quarter performance and our execution against our growth initiatives. I'm also very impressed by the team's speed and agility in navigating the current environment. As mentioned, we believe the impact of the tariffs to our business is transitory, and while distracting, it does give us the opportunity to showcase our resilience. Our brands and teams have successfully navigated multiple macro environment challenges before, and I'm confident that we will emerge in a position of strength, and we'll be well positioned from both a brand and operational standpoint to capture additional market share through this transition. Now, I'll hand it over to Kevin to walk you through the financials in more detail.