A.K.A Brands, the parent company of popular brands such as Princess Polly, Culture Kings, and Mnml, recently released their preliminary financial results for the second quarter. The company reported a 6% increase in net sales, or 11% in constant currency, amounting to $158.5 million for the three-month period ending June 30. While this growth is certainly positive, A.K.A Brands expects to incur a net loss of $4.2 million for the June quarter. However, their adjusted EBITDA, a measure of operating performance, came in at $5.9 million.

Jill Ramsey, the CEO of A.K.A Brands, acknowledged the revenue growth achieved in constant currency during the second quarter. However, she also highlighted that the growth rate had slowed compared to previous quarters, and the net sales fell short of expectations. Ramsey attributed these results to various factors, including inflationary pressures on consumers, changes in spending patterns, and a slower-than-expected recovery in Australia. Additionally, the company faced challenges such as lower returns on marketing investments, a competitive promotional environment, and higher merchandise returns, which all contributed to a downward revision in the adjusted EBITDA outlook.

Despite these challenges, A.K.A Brands remains optimistic about their ability to attract and retain customers, particularly in the U.S, where they have experienced strong growth in active customers. Ramsey emphasized that while headwinds are expected to persist throughout the rest of the year, the company anticipates a sequential improvement in adjusted EBITDA rates. They intend to achieve this improvement by optimizing marketing investments, maintaining disciplined inventory controls, and tightening expenses. A.K.A Brands has confidence in their strategies and believes that their portfolio of strong digital brands, adaptable business model, and talented teams will ultimately drive long-term profitable growth.

A.K.A Brands is scheduled to provide an update on their revised fiscal 2022 outlook during their earnings call on August 10. Despite the current challenges in the market, the company remains committed to its growth objectives and is focused on overcoming the obstacles they face while leveraging their strengths to build a successful future.

For more information on A.K.A Brands and their portfolio of brands, visit their official website: https://www.akabrands.com.

To stay updated on the company’s latest financial reports and announcements, visit the investor relations section of their website: https://www.akabrands.com/investor-relations.