The bond building leader reported a 30 percent decline in net sales in the third quarter ending Sept. 30. The company’s specialty retail channel was hit the hardest, reporting a nearly 42 percent drop in sales compared to the same period last year. Olaplex is sold in a number of specialty doors including Sephora.
The company remains focused on efforts to normalise sales, bolster marketing and “actively correct any mentions of misinformation of [the] brand in the market,” said interim CEO J.P Bilbrey said in the earnings call. For the last year, the brand had been the target of bad publicity stemming from a class action lawsuit alleging its products cause hair loss. In July, the case was dismissed.
”Our third quarter results and the encouraging early indicators from our increased investments support our belief that we are making solid progress towards stabilising our sales trend in the second half of 2023,” said Bilbrey in a statement.
The company provided guidance for the 2023 fiscal year and expects sales in the range of $450 million and $460 million and an adjusted EBITDA between $166 million and $174 million. The improved outlook encouraged investors, as Olaplex’s stock soared over 25 percent.
The company has experienced a number of challenges in recent months, including a change in leadership. JuE Wong, who had led the brand since 2020 and oversaw its initial public offering, stepped down last month. Former Supergoop CEO Amanda Baldwin will join the beauty brand early next year.
Can Olaplex Reclaim the Narrative?
The popular hair care brand, at one point valued at over $10 billion, built a powerful community of superfans with its novel ingredients and claims to restore broken bonds. But stiff competition and unsatisfied customers have taken a toll. CEO JuE Wong speaks to BoF about Olaplex’s future.