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Olaplex’s sales declined 9.8 percent in its fourth-quarter earnings to $100.7 million, with a particular miss in its professional salon channel, which dropped 27.1 percent to $31 million, the company said on Tuesday.
However, it beat Wall Street expectations, and the company did see a return to growth in its specialty channel, which grew 5.7 percent to $28.8 million. Direct-to-consumer sales declined 2.5 percent to $40.9 million, and net income decreased 162.4 percent.
The prestige hair care maker, known for its repairing and protecting products referred to as “bond builders”, has struggled since more competitors such as Unilever-owned K18 entered the market, and also had to contend with a class action lawsuit from consumers alleging hair loss.
In a research note, Barclays analyst Lauren Lieberman said top-line growth was better than expected for the business, but that the “real conversation” was around what will follow in 2025, as the company had set conservative guidance and reduced its margin forecast as it plans to invest more in innovation and marketing to regrow sales.
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Last week, it unveiled its first scalp product, and refreshed its logo and visual merchandising.
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Olaplex Customers Claim Hair Loss, Scalp Injuries in Lawsuit
The complaint filed Thursday accuses Olaplex of making false statements, including that its offerings restore damaged hair and provide the “ultimate breakage insurance.”
