a.k.a. Brands Holding Corp.

Greetings and welcome to AKA Brands Corporation second quarter 2025 earnings conference call. At this time, all participants are on a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Emily Schwartz. Thank you. You may begin.

Good afternoon. Thank you for joining AKA Brands to discuss our second 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 Kieron 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 Kieran.

Good afternoon, everyone, and thanks for joining our call to discuss the second quarter. I want to begin by thanking the team for their exceptional execution and dedication in delivering another solid quarter of performance. We're pleased to report that the business maintained strong momentum with net sales exceeding expectations. We also delivered on our profitability expectations, underscoring our ability to adapt and execute in this dynamic landscape. Now let me share some highlights from the second quarter. We grew net sales approximately 9.5% on a constant currency basis to 160.5 million, marking our fifth consecutive quarter of growth. The US, which is our largest and fastest growing region, delivered net sales growth of 14% in the quarter, The double-digit growth reflects the successful execution of our merchandising and marketing initiatives across our brand portfolio, which resonated with customers throughout the spring and early summer season. We're also pleased with the performance in the Australia region, with net sales flat to last year, which was ahead of our expectations, and a meaningful margin improvement, as we lapped the heavy promotional activity in the second quarter of last year. We deepened our customer connections and increased our total addressable market. Active customers grew 3% on trailing 12-month basis, and our global orders increased by 7%. In addition to the strength in our direct-to-consumer channel, our omnichannel expansion plans remain on track, and all new channels are exceeding expectations. Princess Polly successfully opened three stores in the second quarter, and we plan to open eight to 10 more Princess Polly stores in 2026. We're also strengthening our wholesale partnerships to accelerate brand awareness, and we're particularly pleased with Princess Polly and Petal & Pops Nordstrom's chain-wide debut, which gives us confidence in the tremendous global opportunities for our brands. And lastly, benefiting from the strong top-line growth, expanding brand awareness, and continued operating discipline, we delivered 7.5 million of adjusted EBITDA in line with our expectations. Before sharing our brand highlights, I want to first provide an update on our tariff mitigation efforts. As mentioned on our first quarter earnings call, we've taken a three-pronged approach to tariffs, including vendor discounts, diversifying our supply chain, and strategic price increases across our brands. Moving forward in Q4 and beyond, we expect that our sourcing diversification and strategic price increases will offset the impact of the tariffs at the current levels. With regards to our supply chain, we've been working diligently over the past nine months with a global manufacturing partner to diversify our sourcing and build long-term flexibility. The transition is on schedule, and we've already received products from our new vendors and are pleased with the lead times, quality, and costs. Our redesigned sourcing ecosystem allows us to maintain the high product quality standards that what we and our customers expect while also working with manufacturing partners that are fully equipped to support and enhance our test and repeat merchandising approach. Moving forward, our sourcing will be diversified across several countries with sourcing from China particularly focused on newness and our Australian business. I'm confident that we've established a supply chain that is flexible, more cost efficient and geographically diversified across multiple countries, providing us the ability to adapt our supply chain as future trade dynamics evolve. I'm also grateful to our teams who've worked tirelessly over the past nine months to implement our updated sourcing structure, making it stronger and more resilient than ever. In addition to diversifying our supply chain, as mentioned, our brands implemented targeted and strategic price increases to offset the impact of tariffs. We're fortunate that almost all of the products are exclusive to us, allowing us to take pricing action if needed. We will continue to monitor price elasticity throughout the remainder of the year. As mentioned in Q4 and beyond, we expect that our sourcing diversification and strategic price increase will offset the impact of tariffs at the current levels. I'm confident that our updated sourcing strategy, flexible business model, and speed of execution positions us to emerge stronger than we were at the start of the year. Importantly, while we navigated the macro environment, we remain committed to building our brands for the long term, delivering high quality fashion to our customers and balancing both growth and profitability. We remain laser focused on our strategic growth drivers for the year. First, we will attract and retain customers on our direct to consumer channels, through trend-driven exclusive merchandising and distinctive marketing strategies. Secondly, we will expand brand awareness through physical retail growth and select wholesale partnerships. And third, we remain committed to streamlining operations and strengthening our financial foundation to support long-term profitable growth. Now, turning to our brand highlights. Beginning with Princess Polly, our largest brand, accounting for approximately half of our total revenue, Princess Polly is a leading fashion brand known for its trend-forward, high-quality styles, authentic marketing, and deep connections with the next generation of consumers. Its successful omnichannel strategy, which combines its established digital presence with an expanding retail footprint, continues to fuel strong financial performance, enhance brand visibility, and drive meaningful customer acquisition. Core to Princess Polly's successful merchandising strategy is its demand-driven test-and-repeat model, which enables the brand to frequently deliver new styles to its customers. This deeply resonates with Gen Z shoppers, particularly around key moments like prom and graduation, which fuel double-digit growth in the dress category year over year. In addition to its strong performance in dresses, Princess Polly is steadily expanding its presence in customers' closets through growing its matching sets bottoms, denim, and swim categories, which have seen strong growth year over year. Complementing its strong merchandising strategy, Princess Polly's marketing efforts fueled customer engagement and brand growth across multiple channels. On TikTok, the brand is seeing significant momentum with a 60% year over year increase in TikTok shop revenue and thousands of new customers. As early adopters of TikTok search ads in both the US and Australia, the brand continues to lean into one of the most popular platforms for its customers. Beyond TikTok, Princess Polly stays in front of its customers through SMS marketing, influencer collaborations, new advertising channels such as Twitch and Netflix, as well as in-person events. Looking ahead to the second half of the year, we're excited to launch an upcoming influencer collaboration with model and Summer House star Lexi Wood, In addition, Princess Polly is deepening its connections with the student community through immersive college campus tours, featuring exclusive giveaways, branded activations, and interactive experiences, which will begin in Miami during the back to school season. We're also really proud that Princess Polly recently received its B Corp certification, which formalizes the significant progress the brand has made on its ESG goals and reaffirms its commitment to making on-trend fashion more sustainable. Following a series of successful store openings in 2024 and early 2025, Princess Polly expanded its retail footprint in the second quarter with three new locations in Miami, Florida, Columbus, Ohio, and Glendale, California, bringing the total store count to 10. The stores are outperforming expectations in both revenue and customer acquisition. Notably, approximately 30% of in-store shoppers are new to the Princess Polly brand. and we're seeing a halo effect on our surrounding digital business with each new store opening, highlighting the power of its omnichannel strategy. Princess Polly is on track to open three more stores by the end of the year in Long Island and Westchester, New York, and King of Prussia, Pennsylvania. Excitingly, the brand is also set to open its first store in Australia later this year in Bondi Beach. True to Princess Polly's test and learn approach, Each new store opening provides an opportunity to refine key elements, such as store size, inventory management, and visual merchandising, with the potential to enhance store-level financial performance as more stores are opened. Looking ahead to 2026, we plan to maintain our pace of store openings with a goal of opening eight to 10 new Princess Polly stores next year. We look forward to sharing more details on store locations in the coming quarters. Complementing Princess Polly's digital and retail store strategy, the brand is expanding its reach through select wholesale partnerships, including a growing relationship with Nordstrom. We remain very pleased with the results to date and are looking forward to fall and homecoming collections that will launch in stores in September, with marketing activations in select Nordstrom stores. Our other women's brand, Petal & Pop, also continues to resonate with its core 25- to 40-year-old female customer through a curated assortment of feminine fashion, everyday essentials, and occasion styles at accessible price points. Key to Petal & Pup's brand is its Australian heritage, both in style and aesthetic, and the brand is strategically leveraging its dual-hemisphere presence. Utilizing the test-and-repeat merchandising model, the brand first launches styles in Australia a season ahead, allowing it to identify top performers, and confidently scale winning pieces for the U.S. market with expanded colorways or prints. Customers are also responding enthusiastically to fresh trends, with strong full-price selling for new styles reinforcing that when the product is on trend, demand follows. Dresses and matching sets continue to be category leaders for Pebble & Pop, with these categories outperforming in both sales and product mix year over year. On a marketing front, Petal & Pop is driving brand awareness and engagement through a mix of immersive experiences and digital innovation. This quarter, the brand hosted two pop-up activations, one in Abbot Kinney in Venice, LA, and another in Bondi, Sydney, each featuring branded flower carts and curated styles as they deepen customer connections. In parallel, Petal & Pop is actively testing new growth levers on TikTok shop, including promotion offers and creator affiliate programs to further expand reach and drive conversion across social commerce channels. We remain highly encouraged by Petal & Pup's strong performance at Nordstrom following its full rollout across all locations this spring. The brand's high-quality, trend-forward styles at accessible price points are filling a clear white space in the Nordstrom assortment and are resonating strongly with customers. In-store and online sales, as well as product views on Nordstrom.com, consistently exceed expectations, with May and June delivering exceptionally strong results, supported by shop-and-shop experiences and coordinated marketing activations across Nordstrom's doors. While dresses and event wear remain key strengths, we're also seeing strong demand for more casual styles, highlighting the brand's broader appeal and significant growth potential in the U.S. market beyond occasion-driven categories. Looking ahead, the teams are actively collaborating on the fall assortment, which will feature holiday dresses and knits. Beyond the strong financial upside, the Nordstrom partnership is also proving to be a powerful driver of brand awareness and reinforces our conviction in Petal & Pop's long-term potential. Turning to Culture Kings and Minimalt, our streetwear brands, we continue to be pleased with the improvement in our Australian business, fuelled by our turnaround efforts over the last two years. We took deliberate actions, including strengthening the leadership team, shifting production to the test and repeat merchandising approach, and improving the operations across both regions, and the results are encouraging. What sets Culture Kings apart in the streetwear space is its portfolio of trend-leading in-house brands, including Loiter, Minimal, Tare, and St. Morta, which consistently rank among the top bestsellers. Following the transition to the test and repeat merchandising approach in Australia, we're seeing excellent results with in-house brands' revenue growth of double digits in the second quarter of the year. In addition to the in-house brands, roughly half of Culture King's assortment comprises legacy and emerging third-party brands to complete the streetwear outfit. In close partnership with New Era, Culture King's weekly exclusive headwear drops continue to see significant growth over last year. I'm also excited to share that Culture Kings in the U.S. is launching a partnership with Adidas with a sort of building in the first quarter of 2026 in time for the World Cup hosted here in North America. Culture Kings brings its signature retail attainment to life through high-energy events that feature live music, celebrity appearances, and athletes-hosted activations, making every brand interaction exciting and unique. In the second quarter, the brand partnered with WWE for a highly successful exclusive collection launch at its Las Vegas store, drawing over 1,000 customers for meet and greets with five WWE superstars. The event included a custom WWE cage installation and curated displays from the official WWE archive. This activation drove significant foot traffic in sales, sparked viral social media moments, and delivered a truly memorable experience for fans and customers. In addition to its in-store events, Culture Kings continues to build brand awareness through high-impact activations at major music festivals in the second quarter, including Coachella, Stagecoach, EDC, and Summer Smash. In closing, I'm proud of our second quarter results and the meaningful progress across our key initiatives. While the impact of tariff remains a short-term, temporary headwind, it's also an opportunity to showcase the resilience of our brands and the strength of our business model. With our new sourcing structure in place, strong demand for our brands, and the continued disciplined execution from our teams, I'm confident that we are well-positioned to capture additional market share and drive growth and profitability over the near and long term. With that, I'll turn it over to Kevin to take you through the financials in more detail.