Ideas Conference presentation. Presenting next is Brilliant Earth Group, Inc., listed on NASDAQ under the symbol BRLT. Representing the company today is Chief Financial Officer, Jeff Kuo. Thanks so much. All right, thanks everybody. It's a pleasure to be here at the conference and appreciate you taking the time this morning to speak with us. Before I get in, I just wanted to share some of the forward-looking statement and GAAP financial measure disclosures, which are also available on the presentation. They'll be on our investor relations website. Brilliant Earth Group, Inc. was founded 20 years ago, so we're celebrating our 20th anniversary now to really be the next generation fine jeweler for today's consumer. I think we've been able to successfully differentiate over time with a variety of different levers. One is our authentic, mission-driven brand that really connects with our consumers and people are resonating with, especially as consumers today are really looking for that authentic connection with brands and an expression of their own values personally. I think we've been able to cultivate that connection in a very meaningful way over the last 20 years. Another is our collection of differentiated proprietary products that are, many of them, only available at Brilliant Earth Group, Inc., including things like our Jane Goodall Collection, our Sol` C ollection, and many others, which we've won awards for that people are coming to Brilliant Earth Group, Inc. for distinctive, proprietary, trend-leading designs. I think another aspect is the seamless omnichannel experience. Today's consumers are really looking to shop where they want, how they want, when they want, whether that's visiting a showroom, whether it's on our website, interacting with us through chat, or on the phone. We provide that integrated, seamless experience so that you can have one Brilliant Earth Group, Inc. experience however you're interacting with us. That's also differentiating for us. Underlying all of this is a capital-efficient, data and technology-enabled model that allows us to see and adapt to trends much more quickly than the typical player in the jewelry industry. All of these things together have made us successful and able to grow and be profitable over our 20 years and really set the foundation for continued success in the $350 billion jewelry industry. Just a little bit of context on who our customer is. A lot of our customers are in the age range of about 25- 44 years old, higher household income of around $100,000- $200,000 annually. We're addressing needs for couples that are shopping together, people that are giving gifts for loved ones, as well as people buying for themselves. This audience that we're serving is digitally native, and they're really masters of multimedia and culture. They're expecting an integrated, continuous experience across all their different touchpoints and a very personalized and exceptional experience when they're shopping. That's something that we're really delivering across all the different channels and touchpoints that you might be engaging with Brilliant Earth. As I mentioned before, cultivating that authentic brand connection and being personally resonant with the brand is something that's important to our consumer, and we've been able to deliver on that strongly. These are a few of the highlights over our last 20 years, from our founding in 2005. I think it highlights a number of different things: our growth financially, some of the major product milestones, including most recently things like our Jane Goodall Collection, our Perfect and Flawless collection, our Sol collection. Really, a lot of distinctive, proprietary, and innovative products. It also highlights some of the things that we've done in terms of giving back to the communities that we're involved in and our consistent commitment and track record of doing so over the last 20 years. I also point out some of the highlights of how we operate and having a globally diversified supply chain. We have a diversified supply chain across the globe, including sourcing across North America, countries in Asia. That reduces our dependence on any one geography. That's coupled with a broad and deep relationship with our suppliers. We are a trusted supplier that we've worked with many of these companies for years and developed trust, as well as backend technology integrations that allow us to work very efficiently and effectively with those partners. That's part of how we use technology to differentiate and move much more quickly than the typical player in the industry. I think this supply chain produces designs that we have developed in-house with our in-house design studio, with many of our styles being proprietary to us. The combination of proprietary design expertise and a globally diversified supply chain really allows us to meet our consumer base with a very compelling, continually evolving assortment that meets their needs. Taking a step back to some of the points that we think make the opportunity very compelling for us, it is a big industry, as I mentioned before, a $350 billion global industry that's also very fragmented. About two-thirds of the industry is comprised of smaller independents. I think that's an opportunity for us as a well-capitalized, branded player to really capture and gain share in this large industry. I've talked about some of the aspects of our business model, such as the data and technology enablement that allow us to quickly see trends and adapt to them much more quickly than the typical jeweler. We also have, throughout our history, used data, technology, and more recently, things like AI to inform our decision-making and allow us to, again, see and adapt to changes very quickly. This is supported by our asset light model. It's not really burdened by holding excess inventory. As a point of context, our most recent inventory turns were about four times. That compares to the industry overall, which has one to 2x turns. You can see how having that lighter inventory allows us to manage working capital to better align with consumer demands and things that are changing on the supply chain front compared to a typical jeweler. The omnichannel model I've talked about before, really meeting people when, how, and where they want to shop, and then the strong value alignment with our consumers. I think these are all parts of what makes the opportunity compelling and what makes us well-positioned to capture that opportunity. Just to provide a little bit of context about our recent financial highlights, between 2019 and 2024, we grew at a 16% five-year CAGR, so we're able to significantly grow over that time period, as well as meaningfully expand our gross profit margin from 42% in 2019, getting to 60% in 2024. That gross profit margin growth, just to talk about some of the drivers there, has been one, the strong cultivation of our premium brand and not being discount-oriented. That's one of the underpinnings to our strong gross margin. Operationally, we've amplified that through things like our price optimization engine that allows us to continually test to see what's that right combination of pricing to drive top-line growth and strong gross margins. Also, procurement efficiencies with our scale and ability to balance between different sources of supply. Then things like our enhanced extended warranty program that have also been accretive to our gross margin. Just to walk through a few of our Q2 highlights, we were able to drive growth of about 3% in Q2, getting to $109 million in net sales, with a strong average order value of $2,074 in Q2. We drove strong both repeat and overall total order growth in Q2, with 18% year-over-year growth in total orders and 11% year-over-year growth in repeat orders. We had a gross margin of 58.3% in Q2, and that was within our medium-term target of being in the high 50s, even in the face of things like gold prices being up and the tariff environment that was dynamic during Q2. We delivered an adjusted EBITDA of $3.2 million or 2.9%. Both the net sales and adjusted EBITDA were in excess meaningfully of the guidance range we had provided for Q2. That was our 16th consecutive quarter of delivering positive adjusted EBITDA. That's every quarter that we have been public since going public in 2021, we've delivered positive adjusted EBITDA. We ended the quarter with $99 million in net cash, which was up 5% year- over- year. The business has been able to grow, be profitable, and also generate cash. A few other highlights here, some of them that I've already covered, but one was that we delivered high single-digit year-over-year growth in units for both engagement rings and wedding and anniversary bands for Q2. That's really an indicator of the connection that we're having with our consumers to be able to drive that nice unit growth. We also drove very outsized performance in fine jewelry bookings with that up 38% year- over- year. For context, you know, fine jewelry is a small part of our business overall today, but it's a majority of the industry overall. These are things like pendants, bracelets, earrings, and really a meaningful growth opportunity for us to capture more opportunities for self-purchase, for gifting, to capture more repeat customers. We're really glad to continue to drive that meaningful outperformance in fine jewelry. We opened a new showroom in Alpharetta, which took our showroom footprint to 42 total showrooms with that opening. Also, just for the last couple of items here, we announced a one-time dividend and distribution with total aggregate payments of a little over $25 million. We paid off our outstanding term loan balance of a little under $35 million as of August 4th. We have no debt on the balance sheet. We were able to do that with a strong balance sheet, the cash-generative ability of the business, and we're glad to be able to make these moves in terms of the capital structure. I think I've covered most of the items here already in terms of the sales growth, the gross margin being within our medium-term target, and the adjusted EBITDA. Just briefly again, here's the view for the three-month and the six-month period. Here's another view focusing on order value and total orders. I'd say a couple of things. The order growth we're really pleased with, and that really demonstrates how we're connecting with our consumers, able to acquire and retain them efficiently, and the strong performance across our product assortment. Just to comment briefly on the AOV trend, we did have a decline in AOV year- over- year, both for the quarter and year to date. That's due to a couple of different things. One is that broadening and diversification of our product assortment overall, including in fine jewelry. That's a strategic growth area for us. We want to be growing disproportionately in fine jewelry with some of the benefits that I talked about before with being able to capture more different opportunities along the customer lifecycle. These types of products do have a lower price point than bridal jewelry and engagement rings, and that's going to impact AOV overall. There's an expected decline in AOVs. We've also commented that we've recently had comparatively strong performance in sub-$5,000 engagement rings. We have also, though, seen recent stabilization in ASPs over the last few quarters. I'd like to spend a moment just talking about some of the brand highlights because we really had some very strong, meaningful brand highlights in Q2. Some of them you can see here, including highlights with Beyoncé's Cowboy Carter tour here in Chicago, where she wore a one-of-a-kind diamond bolo that we made for her. We followed that quickly with a limited edition B pendant that was available for sale, and that sold out within days. We announced our first professional sports ambassador, Madison Keys, with a limited edition collaboration that we recently announced. We also were really excited to help Selena Gomez celebrate her birthday when she was wearing a 20-carat diamond necklace, which was from our Jane Goodall Collection. These are some really nice highlights of moments that show how we're connecting with celebrities. We've been able to continue to partner with and work with influencers. Some of the highlights were for Mother's Day, where we introduced a limited edition collection of medallions that has been doing well. These are just some of the examples of how we've been connecting across influencers, tastemakers, and really highlights the connection that we have with our consumers and people that are really, really noticeable in terms of their choices. To highlight some of our working capital dynamics, we have a design-your-own model for much of our product assortment that allows us to use things like virtual inventory to offer hundreds of thousands of natural and lab-grown diamonds while keeping our balance sheet inventory low. This virtual inventory is products that are not on our balance sheet, that are with our suppliers, but we are able to bring them in quickly to meet our customers' needs when we have an order. That helps us have the right balance of diversity of assortment and curation while keeping working capital efficient. As I mentioned before, we have inventory turns that are about four times as of our most recent quarter, which is much higher than the industry average of about one to two. We did have inventory that ended higher year- over- year in Q2. This was principally driven by some strategic procurement opportunities that we saw to bring in diamond and jewelry inventory at compelling prices with some of the current tariff environment. We ended the quarter with a decline in cash, but that was principally driven by the $20 million reduction in debt principal balance. If you're looking at it from a net cash perspective, we ended up 5% year- over-F year with a net cash position at the end of Q2 of $99 million. Just to touch a little bit more in detail on our showrooms. We have 42 showrooms, and what we really want to do is have this be very complementary to all the different touchpoints that we have, whether it's digital, whether you're talking to us on the phone or chat, and really striving to create that seamless omnichannel experience that meets customers where, when, and how they want to shop. Our showrooms are strong performers, with most showrooms delivering strong double-digit metro uplift in the 12 months post-opening. This is an important measure of how we look at our showroom performance because we're looking at driving incrementality across the metro overall. Not just taking what were previously e-comm sales and crediting those to the box, we're looking to drive overall uplift. These figures show that we have been able to drive that nice uplift across an entire metro when we open the showrooms. We've also been innovating with new different features like our try-on bar in our showrooms, which we've introduced in a number of our recent showrooms, which allows you to style and experience our fine jewelry collection in our showrooms, which has been successful and really allows us to capture some of those complementary benefits of driving fine jewelry growth, as well as capturing the benefits from our showrooms. This next stat about retail customers without scheduled appointments, I think, is a really nice manifestation of that, where orders from those customers grew 81% year- over- year in Q2. This is people that came in without scheduled appointments, and it shows how this is increasingly a source of discovery and being able to capture walk-in traffic. Even if you didn't have an appointment, you're able to come in, discover the collection, and order from us. That 81% year- over- year growth, I think, is a really nice metric. As again I mentioned, we've got our 42 showrooms with Alpharetta and looking to continue to have an efficient footprint as we expand because our showrooms do tend to be destinations that people are seeking out. Just to go over some of our priorities that we've been delivering against for 2025, overarching is to continue to be the world's most loved and trusted brand for fine jewelry for today's and tomorrow's consumer. That's underpinned by product excellence and design leadership. You can see some examples of this here and throughout the presentation, but really, people come to us knowing that we're design leaders, that we deliver products that you can get nowhere else, whether that's, you know, the Sol collection, whether it's the Jane Goodall Collection, or some of the other products that I've mentioned here. Really, being known as design leaders is one of the reasons that we've been successful and something that we're continuing to deliver on. We want to continue to deliver those exciting omnichannel experiences that bring joyful luxury to our consumers. Underpinning all this, investing, as we always have, in data, technology, AI, and people and processes to drive operational efficiency and excellence in the customer experience to capture long-term growth. Just to touch briefly on our medium-term targets, which we've been talking about for a number of quarters now, we are looking to get to a net sales growth rate accelerating to a low teens year-over-year growth rate in 2027. That's going to be underpinned by a number of things, including overall normalization and improvement in engagement rings, outperformance in areas like fine jewelry, growth and analyzation of our showroom fleet, as well as overall growing brand awareness and brand halo. I think those are some of the key factors that allow us to get to that, you know, accelerating growth rate with that target in 2027 of low teens year-over-year growth. With gross margin, our medium-term target is for a high 50s% gross margin through 2027. That's going to be supported by the things that I mentioned earlier: the strong brand, amplified operationally by the price optimization engine, seeking out and capturing procurement efficiencies, and then really just kind of managing overall to a continued strong gross margin. For marketing as a percentage of sales, we have been able to deliver leverage. In 2024 versus 2023, we were able to drive leverage in marketing as a percentage of sales. We're planning to work towards that this year and also through 2027 to continue to drive decreasing marketing as a percentage of net sales from 2025- 2027. This is all driving towards an adjusted EBITDA margin target increasing to a double-digit margin in 2027. That's a bit of the outlook as you go out, you know, go out beyond this year. Really just to close up, we are delivering on our mission to be the loved and trusted jeweler for today's and tomorrow's consumers. We've been able to do that with a combination of our differentiated authentic brand that's connecting with our consumers, design-leading products, and having product excellence throughout our portfolio, whether it's in engagement rings, wedding and anniversary bands, and fine jewelry, delivering a seamless omnichannel experience, meeting customers where they are, and then supporting all of that with a working capital-efficient, data and technology-enabled model that allows us to deliver a superior customer experience, as well as capture operational efficiencies so that we can capture an increasing portion of the large and fragmented jewelry industry. Thank you for taking the time. If there are any questions, I'd be glad to talk through. Yes? A few questions. This is mainly a history lesson for some of us that are not familiar with your story. If you go back to like 2022, you had pretty good operating income around $40 million on an annual basis that's really drifted down in the last, say, three years to an operating income that's unadjusted. That's pretty close to pretty even. Can you talk about what some of the pressures have been on the operating income and then also on the sales around that same time, kind of at the end of 2022, you kind of level up in terms of your sales growth. You've been in a total of $420 million business for the past three years. Can you talk about what kind of is happening in the background of this? Some of it's the stores have increased, but is it online? Is it the stores? Again, you get some, you know, history lessons. Sure. The question, just to make sure everyone heard, was about some of the view if you're going back to 2022 on the top line and profitability trends. I'd say there's a number of different things that have been a factor if you're taking that window of time. I think one is bridal, so engagement rings, for example, and wedding bands. That's been our heritage and the bulk of our business. What happened in 2021, as well as the bulk of 2022, was there was kind of like a post-COVID bump in number of engagements and weddings that came out after the initial year of COVID. There was a disproportionate kind of growth rate in year-over-year engagement, weddings. With performance there, simultaneously, you had a disruption in the cadence of people meeting during COVID, kind of the early stage of the meeting-to-marriage pipeline, if you will. Both of those were a factor. We had the disproportionately higher performance in 2021 and 2022 in things like engagement rings, then a bit of a lower performance in the years after that. That was for the industry overall, and then the disruption of the earlier stage pipeline in meeting and relationship development. Those are underpinning some of the normalization that we've talked about in terms of coming out of some of those trend lines. That is, of course, going to affect top line, which will have some follow-on effects into adjusted EBITDA. I think there's a few other things that have been occurring on the profitability side. One is if you're looking at the very, very earliest stages of when we came out and went public, there were certain things like public company operating costs that weren't part of our cost structure as a newly public company that came out. You might have heard us talk about this concept of balance of making investments, like as you pointed out, expanding some of the showroom fleet to capture the longer-term opportunity. We do still have an eye on near-term profitability and having positive adjusted EBITDA. We recognize that that has gone down over the last number of years, but still in a positive moment. We're trying to strike that balance of making the investment for what we think will be a medium and longer-term payoff, even in the face of some of these industry normalization in things like engagement rings. We think that we're on a nice path towards getting to that medium-term target that I articulated of that double-digit adjusted EBITDA target for 2027. Do you value the inventories on balance sheets just at cost, or what's your write-off? Yeah, we do look at the cost of the inventory, and we're on an ongoing basis evaluating for things like excess and obsolescence. Overall, the inventory, I think, is favorable in a number of different ways. One, we have those high inventory turns and an efficient inventory footprint. Another is that the inventory tends to be much less perishable than retail in general. The collection has longevity, things like there's no inherent kind of seasonality that may be much more prominent in areas like apparel. The combination of the longevity of the inventory, the fact that it's light, and that also we have a close eye on the pulse of consumer trends and are able to see things and adapt very quickly, I think that all benefits us. Do you have a current strategy for shareholder contracts? We have a buyback program, and we've purchased to date through the end of Q2 about $1 million of shares. We've executed on that program strategically, also considering factors like trading volumes and our public float. We have made some share buybacks. Any other questions? Great. Thank you again. It's a pleasure to be here at the conference. I welcome the opportunity to speak to you, and hopefully we'll have the chance to connect one-on-one with some of you in the near future. Thanks.