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Q2 2026 OFIGS Earnings Presentation JASMINE V. , BSN , RN
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EARNINGS PRESENTATION2 DISCLAIMER FORWARD -LOOKING STATEMENTS Nothing contained in this presentation is, or should be construed as, a recommendation, promise or representation by FIGS, Inc. (the “Company”) or any officer, director, employee, agent or advisor of the Company. This presentation does not purport to be all inclusive or to contain all of the information you may desire in connection with your investigation of the Company. Information provided in this presentation speaks only as of the date hereof. This presentation shall not constitute an offer to sell or the solicitation of an offer to buy securities, nor shall there be any sale of securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. This presentation also contains estimates and other statistical data relating to the Company's industry and estimated total addressable market. Such estimates and data are based on studies, publications, and surveys obtained from third-party sources and the Company’s own internal estimates and research. While the Company believes these third-party sources and the Company's internal estimates and own research to be reliable as of the date of this presentation, it has not independently verified, and makes no representation as to the adequacy, fairness, accuracy or completeness of, any information obtained from third-party sources, and the Company’s internal research has not been verified by any independent source. In addition, projections, assumptions and estimates regarding the Company's industry are subject to a number of assumptions and limitations and involve a high degree of uncertainty and risk. Accordingly, you are urged not to give undue weight to such estimates and statistical data. Information that can be accessed through any website addressor hyperlink provided herein is not a part of this presentation and is not incorporated by reference herein. We have included any such website address in this presentation solely for informational purposes. This presentation contains various forward-looking statements about the Company within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, that are based on current management expectations, and which involve substantial risks and uncertainties that could cause actual results to differ materially fromthe results expressed in, or implied by, such forward-looking statements. All statements contained in this presentation that do not relate to matters of historical fact should be considered forward-looking. These forward-looking statements generally are identified by the words “anticipate”, “believe”, “contemplate”, “continue”, “could”, “estimate”, “expect”, “forecast”, “future”, “intend”, “may”, “might”, “opportunity”, “outlook”, “plan”, “possible”, “potential”, “predict”, “project”, “should”, “strategy”, “strive”, “target”, “will”, or “would”, the negative of these words or other similar terms or expressions. The absence of these words does not mean that a statement is not forward-looking. These forward-looking statements address various matters, including: the Company’s brand differentiators; the Company's growth opportunities and strategies, including productinnovation, community and engagement, international, TEAMS and retail; the Company’s plans to operate with financial discipline and invest in the future; the Company’s plans to continue to improve its infrastructure; the Company’s plans to make retreats a priority going forward; the Company's plans to drive awareness and engagement; the Company’s international expansion strategy and potential, including plans to open new markets; the Company’s TEAMS opportunity and strategy, including its TEAMS Store experience; the Company’s impact and advocacy efforts, plans and strategy; the Company's retail strategy, including its plans to open additional locations in 2H 2026; the Company's total addressable market and plans to grow its total addressable market and market share; the future growth and growth fundamentals of the healthcare and social assistance industry sector, including the expectation that secular growth of the healthcare industry will be driven by a significant shortage of healthcare workers, aging population and the surge in wellness and aesthetic trends;growing demand from healthcare institutions to professionalize and invest in their staffs; the Company’s financial flexibility and free cash flow generation; the Company’s belief that the unique combination of its product innovation engine and ability to connect with its community is creating long-lasting impact for healthcare professionals; the Company’s belief in its ability to serve the world’s healthcare professionals; the Company’s share repurchase program; the Company’s belief in the momentum of its business and expectations for the second half of 2026; the Company’s focus on delivering for healthcare professionals and shareholders; and the Company's outlook as to net revenues growth and adjusted EBITDA margin for the full year ending December 31, 2026, all of which reflect the Company’s expectations based upon currently available information and data. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, the Company’s actual results, performance or achievements may differ materially from those expressed or implied by the forward-looking statements, and you are cautioned not to place undue reliance on these forward-looking statements. The following important factors and uncertainties, among others, could cause actual results, performance or achievements to differ materially from those described in these forward-looking statements: the Company’s ability to maintain its historical growth; the Company’s ability to maintain profitability; the Company’s ability to maintain the value and reputation of its brand; the Company’s ability to attract new customers, retain existing customers, and to maintain or increase sales to those customers; the success of the Company’s marketing efforts; the Company’s ability to maintain a strong community of engaged customers and Ambassadors; negative publicity related to the Company’s marketing efforts or use of social media; the Company’s ability to successfully develop and introduce new, innovative and updated products; the competitiveness of the market for healthcare apparel; the Company’s ability to maintain its key employees; the Company’s ability to attract and retain highly skilled team members; risks associated with expansion into, and conducting business in, international markets; changes in, or disruptions to, the Company’s shipping arrangements; the successful operation of theCompany’s fulfillment operations; the Company’s ability to accurately forecast customer demand, manage its inventory, and plan for future expenses; the impact of changes in consumer confidence, shopping behavior and consumer spending on demand for the Company’s products; the impact of macroeconomic trends on the Company’s operations; the Company’s reliance on a limited number of third-party suppliers; the impact of global trade policy on the Company’s ability to source and distribute its products; the fluctuating costs of raw materials; the Company’s ability to execute on its B2B growth strategy; the Company’s ability to execute on its retail growth strategy; the Company’s failure to protect proprietary, confidential or sensitive information or personal customer data or risks of cyberattacks; the Company’s failure to protect its intellectual property rights; the fact that the operations of many of the Company’s suppliers and vendors are subject to additional risks that are beyond its control; and other risks, uncertainties, and factors discussed in the “Risk Factors” section of the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2026 to be filed with the Securities and Exchange Commission (“SEC”), the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC on February 26, 2026, and the Company’s other periodic filings with the SEC. The forward-looking statements in this presentation speak only as of the time made and the Company does not undertake to update or revise them to reflect future events or circumstances.
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To celebrate, empower, & serve those who serve others OUR MISSION EARNINGS PRESENTATION3
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EARNINGS PRESENTATION4 WHY FIGS? • Large, replenishment-driven sector with strong long-term growth fundamentals • Disrupting the healthcare apparel industry globally with best- in-class product and storytelling that centers around an underserved community • Sustainable brand differentiators within marketing, product innovation, and merchandising strategy • Numerous growth opportunities within the US, International, TEAMS (B2B), andCommunity Hubs (Retail) • Strong balance sheet and cash flow provide flexibility to both invest in growth and return value to shareholders
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Q2 at a Glance NET REVENUES $196.6M GROSS MARGIN 75.2% ADJ. EBITDA MARGIN (2) 18.6% EARNINGS PRESENTATION5 • Delivered year-over-year net revenues growth of 29% in Q2 2026, exceeding our outlook o Average order value (“AOV”)(1) increased 9% to $127 o Active customers(1) grew 13% to 3.1 million o Scrubweargrew 27% (82% of net revenues); non-scrubweargrew 40% (18% of net revenues) o U.S. grew 22% (81% of net revenues); international grew 67% (19% of net revenues) • Gross margin expanded 820 basis points to 75.2%, primarily due to a 780-basis point positive impact from IEEPA tariff refunds recognized • Adjusted EBITDA margin(2) expanded 570 basis points to 18.6%, ahead of expectations, driven by strong overall expense leverage and ongoing efficiency efforts, and excluding the benefit of IEEPA tariff refunds related to the prior year period • Maintained strong financial flexibility, growing end of period cash, cash equivalents and short-term investments position by 24% to $296.3 million while repurchasing ~ $24.0 million of our Class A common stock through our share repurchase program (1) AOV and active customers are key operational and business metrics that are important to understanding our performance. See “Non-GAAP Financial Measures and Key Operating Metrics” in the Appendix for additional information on this metric. (2) Adjusted EBITDA and adjusted EBITDA margin are non-GAAP financial measures. See “Non-GAAP Financial Measures and Key Operating Metrics” in the Appendix for additional information on non-GAAP financial measures and reconciliations to the most directly comparable GAAP measures. Click Here for our Q2 2026 Recap Video
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KEY OPERATING METRICS Active Customers (TRAILING TWELVE MONTHS, IN THOUSANDS) Net Revenues Per Active Customer (TRAILING TWELVE MONTHS) (1) (1) 2,593 2,670 2,921 2,736 3,097 2,300 2,400 2,500 2,600 2,700 2,800 2,900 3,000 3,100 3,200 FY'23 FY'24 FY'25 Q2'25 Q2'26 $210 $208 $216 $208 $229 $195 $200 $205 $210 $215 $220 $225 $230 $235 FY'23 FY'24 FY'25 Q2'25 Q2'26 YOY +13% YOY +10% EARNINGS PRESENTATION6 (1) Active customers and net revenues per active customer are key operational and business metrics that are important to understanding our performance. See “Non-GAAP Financial Measures and Key Operating Metrics” in the Appendix for additional information on these metrics.
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KEY OPERATING METRICS $115 $113 $120 $117 $127 $100 $105 $110 $115 $120 $125 $130 FY'23 FY'24 FY'25 Q2'25 Q2'26 YOY +9% EARNINGS PRESENTATION7 Average Order Value (AOV) (1) AOV is a key operational and business metric that is important to understanding our performance. See “Non-GAAP Financial Measures and Key Operating Metrics” in the Appendix for additional information on this metric. (1)
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EARNINGS PRESENTATION8 DIVERSIFIED GROWTH STRATEGY International Expanding to better reach the global healthcare community with 80+ countries currently outside the U.S. Community Hubs Deepen connection to our community by engaging with them in person. TEAMS Opportunity to serve institutions around the world that want to professionalize and standardize their teams. Community & Engagement Drive awareness and engagement through powerful, purposeful storytelling, and unwavering commitment to advocacy. Product Innovation Continued disruption and technical innovation across styles, categories, and fabrications to better serve our healthcare professionals. Operate with Financial Discipline and Invest in the Future Optimize infrastructure to support scale, increase reliability, flexibility, and speed to market EARNINGS PRESENTATION8 Market Expansion
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EARNINGS PRESENTATION9 Product Innovation We introduced new products across the layering system designed for maximum comfort, versatility, and durability, including: • New Maternity Collection: For the first time since 2023, FIGS launched a new maternity collection with six new styles as an extension of our core scrubwear styles. Our PUSH IT campaign featured eight expectant FIGS ambassadors accompanied by the 80s hit “Push It” by Salt-N-Pepa. • Franchise Expansions in Non-Scrubwear: We are also seeing success leveraging trusted core styles in non-scrubwearwith impactful new silhouettes, including cropped versions of our Sydney and Contourknitscrubjackets. • Impactful Collaborations: We launched two collaborations during the quarter that had an immediate impact with healthcare professionals, rapidly selling out. We returned to a galaxy far away with our latest Star Wars launch which featured new styles in Jade and Smokey Taupe colors that were inspired by the latest movie, The Mandalorian & Grogu. The new collaboration with drinkware brand Owala launched for Nurses Week featuring two versions of the Owala® x FIGS bottles.
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EARNINGS PRESENTATION10 Build and Deepen Connection with Community NURSES WEEK Supporting a hallmark moment for our community that sits at the heart of all we do, we celebrated Nurses Week with the next chapter of our Never Change campaign. An authentic reflection of the experiences of nurses, the campaign highlighted the challenges they face every single day on the job, but also the unwavering commitment to always putting their patients first. As an extension of the campaign, we took over Chicago with our multi-day IRL ‘Anti-Pizza-Party Pizza Party,’ cheekily playing on the crude celebrations that nurses all too often receive, hosting over 8,000 nurses in the area! We also brought these pizza parties to all five of our Community Hubs. FIGS RETREAT In June, we hosted nearly 80 healthcare professionals and FIGS ambassadors to create a space where they could recharge, care for themselves, connect through shared experiences, and recenter around what matters most. This is a manifestation of our purpose and how we show up for our community, and we plan to make these important touchpoints a priority going forward. The event drove over nine million impressions across owned and ambassador social channels.
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EARNINGS PRESENTATION11 Impact AWESOME HUMANS ON THE HILL In Q2, we hosted our most impactful Awesome Humans on the Hill ever, bringing extraordinary healthcare professionals and Noah Wyle to Washington, D.C. for more than 30 meetings with key members of Congress. We advocated for policies that value healthcare professionals, support their mental health and protect their ability to speak up for safer care. THE HEALTHCARE IS HUMAN RALLY We expanded our advocacy beyond congressional meetings with the first-ever Healthcare is Human Rally, where hundreds of healthcare professionals gathered on Capitol Hill alongside bipartisan lawmakers. The event put healthcare professionals and their lived experiences at the center of the national policy conversation. TURNING AWARENESS INTO ACTION The campaign drove 5,000 messages to Congress and generated more than 10 million impressions. It also helped build tangible momentum for three of our legislative priorities: (1) passing the Healthcare is Human Act, a first of its kind tax credit for healthcare professionals, (2) fully funding the Dr. Lorna Breen Provider Protection Act, critical mental heath legislation for healthcare professionals, and (3) introducing the Healthcare Professionals SPEAK FREE Act, all- new legislation that enables healthcare professionals to speak out on issues of safety without facing retaliation.
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Expanding Global Presence INTERNATIONAL EARNINGS PRESENTATION12 Disrupting global healthcare apparel with product innovation,powerful top of funnel marketing campaigns and localized engagement with the community • Opportunity: over 80% of global healthcare professionals are outside the U.S. yet represented only 16% of our net revenues in FY 2025. • Q2 2026 international net revenues reached a new company high, growing 67% YOY with over 50 points of that growth coming from our existing comp markets. • Highlights include exceptional growth from Europe, Latin America, and Mexico, as well as meaningfully better performance in Canada, Australia, and the Middle East. • Heightened brand building investments included efforts to localize and activate in-person moments, recruiting ambassadors and supporting user-generated content, and ramping new search and social platforms in local markets. • Year-to-date, we have increased our reach from 58 countries in FY 2025 to 85 countries through July 2026. ASHLEY T., DMD CANADIAN AMBASSADOR
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Serving Healthcare Institutions TEAMS Serving hospitals, medical offices, and concierge clinics to professionalize and standardize their teams • Opportunity: ~15% of the U.S. scrubs industry has historically been driven by institutions buying for their teams, while the commercialization of healthcare is increasingly driving premium experiences including uniforms. • To support a scalable foundation for growth, we are focused on developing relationships with our existing accounts and building a pipeline of higher-impact opportunities. • During Q2 2026, we continued to add functionality to our Team Store platform. Additional work is planned on the roadmap, all designed to make it as easy as possible to outfit a growing range of healthcare employees in FIGS and create unparalleled value in the experience. EARNINGS PRESENTATION13
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EARNINGS PRESENTATION14 Creating Community Presence COMMUNITY HUBS Executing a retail strategy that enables healthcare professionals to connect with FIGS and their peers • Opportunity: over 60% of non-FIGS customers want to try and feel a product before a purchase. • Delivered record results in Q2 2026 with both strong comp-store performance and new store contributions. • Currently operate five Community Hubs in Los Angeles, Philadelphia, New York City, Houston and Chicago. • 2026 focus remains on optimizing our existing Hubs, implementing a store development engine, and expanding our market presence. • Our four planned 2H 2026 openings include Fashion Square in Scottsdale, Tyson’s Corner outside of Washington, D.C., Valley Fair near San Jose, and Aventura Mall in Miami.
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EARNINGS PRESENTATION15 Large Industry Sector with Strong Long Term Growth Fundamentals • Largely non-discretionary, replenishment-driven industry with approximately 24 million workers in the U.S.(1) • Creating TAM by expanding and evolving the FIGS layering system with both new innovation and new categories • Expect secular growth to be driven by significant shortage of healthcare workers, the growing needs of an aging population, and the surge in wellness and aesthetic trends • Healthcare and social assistance is projected to have the largest growth and be the fastest growing industry sector from 2024-2034 (2) WHY FIGS? (1) According to the U.S. Bureau of Labor Statistics for the number of healthcare and social assistance industry sector workers in the U.S. as of June 2026. (2) See News Release, U.S. Bureau of Labor Statistics, Employment Projections — 2024-2034 (Aug. 28, 2025). (3) Free cash flow is a non-GAAP metric. See “Non-GAAP Financial Measures and Key Operating Metrics” in the Appendix for additional information on non-GAAP financial measures and reconciliations to the most directly comparable GAAP measures. Sustainable Differentiators • Authentic, category-defining brand with deeply passionate, loyal community • Industry leading product innovation • Highly efficient marketing engine due to strong word of mouth and repeat dynamics (over 70% of net revenues driven by repeat customers) • Proven merchandising strategy with highly concentrated and productive core assortment • Vast data set informs product innovation and drives personalization Numerous Growth Opportunities • Long runway in U.S. to drive brand awareness and share of wallet • Significant international potential with less than 1% market share globally • TEAMS (B2B) capitalizing on growing demand from healthcare institutions to professionalize and invest in their staffs • Community Hubs(retail) to meet healthcare professionals where they work and live, driving awareness, connection, and lifetime value Strong Margin and Cash Flow Dynamics • Structurally high gross margin with concentrated seasonless scrubs assortment • Healthy, debt-free balance sheetwith strong financial flexibility • Strong free cash flow (3) generation
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16 EARNINGS PRESENTATION
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$545.6 $555.6 $631.1 $152.6 $196.6 $0 $100 $200 $300 $400 $500 $600 $700 FY'23 FY'24 FY'25 Q2'25 Q2'26 Q2 2026 NET REVENUES (IN MILLIONS) Q2 2026 SCRUBWEAR / NON-SCRUBWEAR NET REVENUES MIX AND YOY GROWTH Q2 2026 US / INTERNATIONAL NET REVENUES MIX AND YOY GROWTH 82%, +27% YOY 18%, +40% YOY Scrubwear Non-Scrubwear 81%, +22% YOY 19%, +67% YOY U.S. International YOY +29% EARNINGS PRESENTATION17
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Q2 2026 GROSS MARGIN 69.1% 67.6% 66.5% 67.0% 75.2% 60% 62% 64% 66% 68% 70% 72% 74% 76% FY'23 FY'24 FY'25 Q2'25 Q2'26 EARNINGS PRESENTATION18 The 820-basis point improvement in gross margin compared to Q2 2025 included the 780-basis point impact from IEEPA tariff refunds recognized. Besides the refund, core gross margin improvement was primarily driven by the positive impacts from pricing and ongoing efficiency efforts which more than offset the impact of higher non- IEEPA tariffs.
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Q2 2026 OPERATING EXPENSE EARNINGS PRESENTATION19 22.8% 20.5% 15.2% 14.5% 22.6% 22.2% 0% 10% 20% 30% 40% 50% 60% 70% Q2'25 Q2'26 G&A Marketing Selling 60.5% 57.3% (% OF NET REVENUES) The decrease in selling expense in Q2 2026 as a percentage of net revenues primarily reflected the impacts of net revenues leverage as well as favorable outbound shipping rates, partially offset by the impact of supply chain investments and international mix. The decrease in marketing expenses in Q2 2026 as a percentage of net revenues primarily reflected the impacts of net revenues leverage as well as digital marketing efficiency, partially offset by brand awareness initiatives internationally, our FIGS retreat activations, and expanded brand partnerships. The decrease in G&A expenses in Q2 2026 as a percentage of net revenues primarily related to net revenues leverage and lower stock-based compensation expense, partially offset by investments in our team.
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Q2 2026 PROFITABILITY Net Income Margin (% OF NET REVENUES) Adjusted EBITDA Margin (% OF NET REVENUES) (1) 4.1% 0.5% 5.4% 4.7% 14.4% 0% 4% 8% 12% 16% FY'23 FY'24 FY'25 Q2'25 Q2'26 15.8% 9.3% 11.8% 12.9% 18.6% 0% 5% 10% 15% 20% FY'23 FY'24 FY'25 Q2'25 Q2'26 EARNINGS PRESENTATION20 (1) Adjusted EBITDA margin is a non-GAAP financial measure. See “Non-GAAP Financial Measures and Key Operating Metrics” in the Appendix for additional information on non-GAAP financial measures and reconciliations to the most directly comparable GAAP measures.
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Q2 2026 BALANCE SHEET AND CASH FLOW RESULTS Cash, Cash Equivalents & Short-Term Investments Cash Flow Changes (FOR THE YTD PERIOD ENDED JUNE 30, 2026 ) ($ IN MILLIONS, UNAUDITED) $268.5 $238.8 $296.3 Q2'24 Q2'25 Q2'26 $300.8 $296.3 0 50 100 150 200 250 300 350 400 Cash, Cash Equivalents & Short-Term Investments, Beginning of Period Net Income Other Working Capital and Other Operating Items Inventory Change CAPEX Other Activities Cash, Cash Equivalents & Short-Term Investments, End of Period Free Cash Flow(1) $34.7 $38.6 EARNINGS PRESENTATION21 (1) Free cash flow is a non-GAAP financial measure. See “Non-GAAP Financial Measures and Key Operating Metrics” in the Appendix for additional information on non-GAAP financial measures and reconciliations to the most directly comparable GAAP measures. ($ IN MILLIONS, UNAUDITED) $0.5 $8.4 -$5.0 -$9.8 -$32.8 Share Repurchase Net Share Settlement of Equity Awards -$0.5
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NET REVENUES GROWTH VS. 2025 Up ~20.0% ADJUSTED EBITDA MARGIN (1) 14.8% to 15.0% EARNINGS PRESENTATION22 Updated Full Year 2026 Outlook (1) “adjusted EBITDA” and “adjusted EBITDA margin” are non-GAAP financial measures. We have not provided a quantitative reconci liation of our adjusted EBITDA margin outlook to a GAAP net income margin outlook because we are unable, without making unreasonable efforts, to project certain re conciling items. These items include, but are not limited to, future stock-based compensation expense, income taxes, expenses related to non -ordinary course disputes, and transaction costs. These items are inherently variable and uncertain and depend on various factors, some of which are outside of our control or ability to predict. For mor e information on our use of non-GAAP metrics, see “Non-GAAP Financial Measures and Key Operating Metrics” in the Appendix. FIGS’ exceptional Q2 performance was powered by strong, ongoing traction across the business, with outperformance on both the top and bottom lines. We delivered our third straight quarter of 25%-plus net revenues growth, our net revenues per active customer exceeded COVID-era highs, and our adjusted EBITDA margin grew significantly to 18.6%. Most notably, our success did not just come from one area of the business, but instead was broad-based across categories, geographies and channels. Looking forward, the unique combination of our product innovation engine and our ability to connect with our community is creating long-lasting impact for healthcare professionals. And given that we are still only serving a tiny percentage of the world’s healthcare professionals, we believe we are just getting started. - Trina Spear, Chief Executive Officer and Co-Founder “ ” We are once again demonstrating the power of our business model to combine growth and profitability. In Q2, our topline strength continued with growth of 28.8%. Concurrently, we grew our adjusted EBITDA margin to 18.6%, driven by strong overall expense leverage and ongoing efficiency efforts, and excluding the benefit of IEEPA tariff refunds related to the prior year period. Due to the clear momentum in our business, we are not only passing through the upside of our Q2 results, we are also layering in increased expectations for the second half of the year. Moreover, as we look to align this growing confidence with shareholder returns, we are pleased to announce a $100 million increase to our ongoing share repurchase program. FIGS has a unique opportunity ahead and we are relentlessly focused on continuing to deliver for healthcare professionals and shareholders alike. - Sarah Oughtred, Chief Financial Officer “ ” Prior outlook: up 14% to 16% Prior outlook: 13.0% to 13.2%
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23 EARNINGS PRESENTATION
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EARNINGS PRESENTATION24 NON -GAAP FINANCIAL MEASURES AND KEY OPERATING METRICS Included in this presentation are certain financial measures that are not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”) and which are designed to supplement, and not as a substitute for, the Company’s financial information presented in accordance with GAAP. The non-GAAP financial measures as defined by the Company may not be comparable to similar non-GAAP financial measures presented by other companies. The presentation of such measures, which may include adjustments to exclude unusual or non-recurring items, should not be construed as an inference that the Company’s future results will be unaffected by other unusual or nonrecurring items. The Company uses “net income, as adjusted,” “diluted earnings per share, as adjusted,”“adjusted EBITDA” and “adjusted EBITDA margin” to provide useful supplemental measures that assist in evaluating its ability to generate earnings, provide consistency and comparability with its past financial performance and facilitate period-to-period comparisons of its core operating results as well as the results of its peer companies. The Company uses “free cash flow” as a useful supplemental measure of liquidity and as an additional basis for assessing its ability to generate cash. The Company calculates “net income, as adjusted” as net incomeadjusted to exclude transaction costs, expenses related to non-ordinary course disputes, other than temporary impairment of held-to-maturity investments, stock-based compensation, including expense related to award modifications, accelerated performance awards and associated payroll taxes and costs, ambassador grants in connection with its initial public offering, and expense resulting from the retirement of a former CFO of the Company, and the income tax impact of these adjustments. The Company calculates “diluted earnings per share, as adjusted” as net income, as adjusted divided by diluted shares outstanding. The Company calculates “adjusted EBITDA” as net income(loss) adjusted to exclude: other income, net; gain/loss on disposal of assets; provision for income taxes; depreciation and amortization expense; stock-based compensation and related expense; transaction costs; expenses related to non-ordinary course disputes, and refunds recognized for IEEPA tariffs incurred on goods sold in the prior fiscal year. The Company calculates “adjusted EBITDA margin” by dividing adjusted EBITDA by net revenues. The Company calculates “free cash flow” as net cash (used in) provided by operating activities reduced by capital expenditures, including purchases of property and equipment and capitalized software development costs.
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EARNINGS PRESENTATION25 The following table presents a reconciliation of adjusted EBITDA to net income, which is the most directly comparable financial measure calculated in accordance with GAAP, and presents adjusted EBITDA margin with net income margin, which is the most directly comparable financial measure calculated in accordance with GAAP: NON -GAAP FINANCIAL MEASURES AND KEY OPERATING METRICS (CONT.) The following table presents a reconciliation of free cash flow to net cash(used in)provided by operating activities, which is the most directly comparable financial measure calculated in accordance with GAAP: 2026 2025 2026 2025 (in thousands, except margin) Net income 28,379$ 7,099$ 34,667$ 6,997$ Add (deduct): Other income, net (1,619) (2,116) (3,581) (4,191) Provision for income taxes 8,502 4,932 8,659 6,898 Depreciation and amortization expense (1) 2,371 2,153 5,782 4,152 Stock-based compensation and related expense (2) 6,852 7,659 12,840 15,046 IEEPA tariff refund(3) (7,899) - (7,899) - Adjusted EBITDA(4) 36,586$ 19,727$ 50,468$ 28,902$ Net revenues 196,619$ 152,640$ 356,521$ 277,541$ Net income margin(5) 14.4% 4.7% 9.7% 2.5% Adjusted EBITDA margin 18.6% 12.9% 14.2% 10.4% Footnote explanations: (1) Excludes amortization of debt issuance costs included in “Other income, net.” (2) Includes stock-based compensation expense, payroll taxes and costs related to equity award activity. (5) Net income margin represents net income as a percentage of net revenues. Three Months Ended June 30, Six Months Ended June 30, (unaudited) (3) Consists of refunds recognized for IEEPA tariffs incurred on goods sold in the year ended December 31, 2025. (4) For the six months ended June 30, 2025, reflects $171,000 of stock-based compensation expense and payroll taxes inadvertently not reflected in our previously disclosed Adjusted EBITDA results for the three months ended March 31, 2025. 2026 2025 (in thousands) Net cash (used in) provided by operating activities 43,653$ (3,195)$ Less: capital expenditures (5,026) (2,399) Free cash flow 38,627$ (5,594)$ Six Months Ended June 30,
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EARNINGS PRESENTATION26 The Company has also included herein “active customers,” “net revenues per active customer” and “average order value,” which are key operational and business metrics that are important to understanding Company performance. The Company believes the number of active customers is an important indicator of growth as it reflects the reach of the Company’s digital platform, brand awareness and overall value proposition. The Company defines an active customer as a unique customer account that has made at least one purchase inthe preceding 12-month period. In any particular period, the Company determines the number of active customers by counting the total number of customers who have made at least one purchase in the preceding 12-month period, measured from the last date of such period. The Company believes measuring net revenues per active customer is important to understanding engagement and retention of customers, and as such, the value proposition for its customer base. The Company defines net revenues per active customer as the sum of total net revenues in the preceding 12-month period divided by the current period active customers. The Company defines average order value as the sum of the total net revenues in a given period divided by the total orders placed in that period. Total orders are the summation of all completed individual purchase transactions in a given period. The Company believes its relatively high average order value demonstrates the premium nature of its products. As the Company expands into and increases its presence in additional product categories, price points and international markets, average order value may fluctuate. NON -GAAP FINANCIAL MEASURES AND KEY OPERATING METRICS (CONT.)