June 3, 2026

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Oddity Tech Ltd. (NASDAQ: ODD) fell after reporting first-quarter 2026 results that showed a steep revenue decline, a swing to net loss, negative adjusted EBITDA, and continued pressure from higher customer acquisition costs.
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Oddity Tech is a digital beauty and wellness company that uses data science, AI, and online marketing to sell brands such as IL MAKIAGE, SpoiledChild, and METHODIQ.
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The company reported an adjusted loss of $0.17 per share, below estimates for a loss of $0.04, representing a negative 325.0% earnings surprise. Revenue came in at $197.94 million, above estimates of $187.65 million, but revenue still declined 26.2%.

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Results Pressured by Ad Account Dislocation

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Oddity reported first-quarter net revenue of $197.9 million, down 26% from $268.1 million in the prior-year quarter. The company said results were hurt by a customer acquisition cost dislocation with its largest advertising partner, with CPA in some cases reaching levels about two times higher than expected.
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Gross margin fell to 69.7% from 74.9%, partly due to product and brand mix, lower average order value, and testing tied to its advertising remediation work. Net loss was $21.4 million, compared with net income of $37.8 million a year earlier. Adjusted EBITDA was negative $7.0 million, compared with positive adjusted EBITDA of $52.4 million in the prior-year quarter.
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Management said the advertising issue caused a sharp decline in first orders, which is expected to pressure repeat business through the year. The company expects second-quarter net revenue to decline 25% to 30% year-over-year, with adjusted EBITDA of $8 million to $10 million. For the full year, Oddity still expects adjusted EBITDA to be positive.
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Oddity also highlighted a strong liquidity position, with $667.4 million in cash, cash equivalents, and investments, plus $350 million in undrawn credit facilities. The company repurchased about 6.1 million shares for $82.3 million during the quarter, reducing Class A shares outstanding by about 10.6%.

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Market Focus

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Investors are likely to watch whether Oddity can normalize customer acquisition costs, restore first-order growth, and protect repeat revenue.
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The key areas are IL MAKIAGE CPA trends, advertising partner remediation, gross margin, repeat customer revenue, Q2 revenue decline, adjusted EBITDA recovery, share repurchases, and liquidity.

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The Bigger Picture

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Oddity’s quarter showed that the company is still dealing with a major marketing efficiency problem.
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Revenue beat expectations, but the sharp year-over-year decline, negative EBITDA, lower gross margin, and weak Q2 revenue outlook likely outweighed that beat. The stock reaction suggests investors need clearer proof that customer acquisition costs are normalizing before pricing in a recovery.
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