Gerstein highlights brand momentum. CEO Beth Gerstein told analysts the results “reflect the success of the investments we’ve been making across product, brand and experience,” noting that “2025 was a banner year for Brilliant Earth” as the company celebrated its 20th anniversary. She emphasized the fine jewelry breakthrough: “Our full year 2025 fine jewelry bookings are more than three times bigger than they were just four years ago at the time of our IPO”. CFO Jeffrey Kuo highlighted the margin achievement despite extreme cost pressures: “We are extraordinarily proud of our ability to deliver strong gross margins in this environment which speaks to the strength of our premium brand positioning, our data-driven price optimization engine, our globally diversified supply chain and the agility of our team and business model”.
Analysts probe AOV and metal hedging. Julia Shalansky from TD Securities asked about AOV expectations and the company’s gold and platinum hedging strategy, questioning how much current inventory is effectively price-protected. Gerstein responded that ASPs are rising across all categories due to brand strength and higher-income customer demand, while the fine jewelry mix shift creates the AOV headwind. Kuo explained the company uses “a variety of different tools” beyond hedging, including dynamic pricing optimization, product engineering, and vendor negotiations to manage metal costs. Ashley Owens from KeyBanc Capital Markets questioned the path to the previously mentioned $100 million fine jewelry opportunity and whether the business would become less dependent on engagement ring cycles. Gerstein confirmed the diversification strategy, noting that “half of our new customers discover us now through fine jewelry” and that the company is following the path of successful independents with higher fine jewelry mix.
Management guides to mid-single-digit growth. For full-year 2026, the company expects net sales to grow in the mid-single-digit percent range year-over-year, with gross margin in the mid-50s percent range assuming metal prices remain at current elevated levels. Management projects continued marketing leverage as a percentage of sales for the third consecutive year, but expects positive adjusted EBITDA for 2026 to be “slightly lower than last year’s adjusted EBITDA dollars given the challenging metal cost environment,” with most of the year’s profitability concentrated in Q4. For Q1 2026, the company expects net sales growth in the mid-single-digit percent range with adjusted EBITDA margin in the negative mid-single-digit range, driven by the speed and magnitude of recent gold and platinum price increases. Notably, management withdrew its medium-term targets, stating that “the precious metal environment we are operating in today is unlike anything our industry has experienced” and that metal price uncertainty makes targets beyond 2026 inappropriate at this time.
What to Watch: The newly opened Beverly Hills flagship showroom represents an evolved retail concept that Forbes called “a blueprint for the future of luxury jewelry retail,” featuring innovations like the Eternity Bar, fine jewelry personalization station, and exclusive date night appointments. With two additional showroom openings planned for 2026 and fine jewelry on track to reach $100 million annually, the key question is whether the company’s pricing power and product mix shift can offset persistent metal cost headwinds that pushed gross margin down 370 basis points year-over-year in Q4. Management’s ability to deliver on Q1 guidance amid near-record gold and platinum prices will signal whether the diversification strategy can sustain profitability through the current commodity cycle.
This article was generated using AlphaStreet’s proprietary financial analysis technology and reviewed by our editorial team.
