Summary of Brilliant Earth Q2 2026 Earnings Call

1Key Financial Results and Metrics

Net Sales: $115.1 million, up approximately 6% year-over-year, exceeding guidance.

Average Selling Price (ASP): Increased year-over-year across wedding bands and fine jewelry; stable for engagement rings.

Total Orders: Down 2% year-over-year; however, excluding orders under $500, orders increased by 5%.

Adjusted EBITDA: $5.8 million, significantly above expectations, reflecting a 5% adjusted EBITDA margin.

Gross Margin: 57.9%, up 360 basis points sequentially from Q1, though down 40 basis points year-over-year.

Operating Expenses: 57.5% of net sales, down from 59.4% in Q2 2025, demonstrating operational efficiency.

Cash Position: Approximately $75 million in cash with no debt, an increase of $16 million from Q1.

2Strategic Updates and Business Highlights

Product Performance: Fine jewelry bookings grew 32% year-over-year, driven by strong Mother's Day sales and new product collections.

Showroom Strategy: Significant growth in showroom bookings (up 47% for walk-in customers) and successful launch of the Beverly Hills flagship store, which saw bookings up over 40% year-over-year.

Brand Engagement: Collaborations with influencers and cultural figures have enhanced brand visibility and resonance, particularly among younger consumers.

Operational Agility: The company demonstrated strong execution in managing costs and optimizing pricing strategies, contributing to improved gross margins.

3Forward Guidance and Outlook

Annual Guidance: Raised full-year net sales expectations to $459 million to $462 million and adjusted EBITDA guidance to $13 million to $15 million.

Q3 Expectations: Anticipated flat year-over-year net sales, with a healthy 10% growth on a 2-year stacked basis. Expected adjusted EBITDA of $3 million to $5 million for Q3.

Gross Margin Outlook: Expected to remain stable in the mid to high 50s for the second half of the year, assuming stable metal prices.

4Challenges and Points of Concern

Order Trends: Total orders are declining, particularly at lower price points, which may indicate a bifurcation in consumer spending.

Market Environment: The company is closely monitoring the consumer environment, which shows signs of softness at lower price points, despite strength at higher price points.

Competitive Pressures: The need for continued investment in marketing and brand awareness is critical, especially as the holiday season approaches and competition intensifies.

5Notable Q&A Insights

Order Growth Dynamics: Management emphasized a strategic focus on the $500+ segment, indicating that while lower price point orders are declining, higher-end orders are performing well.

Marketing Spend: The decrease in marketing expense as a percentage of sales reflects a balance between efficiency and necessary investments in brand growth. Management is optimistic about maintaining marketing effectiveness amid competitive pressures.

Gross Margin Drivers: Future gross margin improvements are expected to come from operational efficiencies and potential price increases, particularly as the company navigates a volatile market environment. Overall, Brilliant Earth reported a strong Q2 performance, driven by strategic initiatives and operational efficiencies, while also acknowledging challenges in consumer spending patterns and the competitive landscape.