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Oddity Tech Ltd

Oddity Tech LtdODD決算レポート

Nasdaq

Oddity Tech Ltd is a global consumer technology company focused on the beauty and wellness sector. It leverages advanced artificial intelligence and data science to develop personalized, high-performance products, operating popular direct-to-consumer brands including Il Makiage and SpoiledChild, serving customers across North America, Europe and other key global markets primarily via e-commerce channels.

What changed in Oddity Tech Ltd's 20-F — 2024 vs 2025

Top changes in Oddity Tech Ltd's 2025 20-F

587 paragraphs added · 567 removed · 433 edited across 6 sections

Item 2. Properties

Properties — owned and leased real estate

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ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE 4 ​ ITEM 3. KEY INFORMATION 4 ​ ​ A. [Reserved] 4 ​ ​ B. Capitalization and Indebtedness 4 ​ ​ C. Reasons for the Offer and Use of Proceeds 4 ​ ​ D. Risk Factors 4 ​ ITEM 4. INFORMATION ON THE COMPANY 58 ​ ​ A.
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE 4 ​ ITEM 3. KEY INFORMATION 4 ​ ​ A. [Reserved] 4 ​ ​ B. Capitalization and Indebtedness 4 ​ ​ C. Reasons for the Offer and Use of Proceeds 4 ​ ​ D. Risk Factors 4 ​ ITEM 4. INFORMATION ON THE COMPANY 60 ​ ​ A.
Interests of Experts and Counsel 113 ​ ITEM 8. FINANCIAL INFORMATION 114 ​ ​ A. Consolidated Statements and Other Financial Information 114 ​ ​ B. Significant Changes 114 ​
Interests of Experts and Counsel 114 ​ ITEM 8. FINANCIAL INFORMATION 114 ​ ​ A. Consolidated Statements and Other Financial Information 114 ​ ​ B. Significant Changes 115 ​
Board Practices and Corporate Governance 96 ​ ​ D. Employees 106 ​ ​ E. Share Ownership 106 ​ ​ F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation 107 ​ ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS 107 ​ ​ A. Major Shareholders 107 ​ ​ B. Related Party Transactions 109 ​ ​ C.
Board Practices and Corporate Governance 97 ​ ​ D. Employees 107 ​ ​ E. Share Ownership 107 ​ ​ F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation 108 ​ ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS 108 ​ ​ A. Major Shareholders 108 ​ ​ B. Related Party Transactions 110 ​ ​ C.
History and Development of the Company 58 ​ ​ B. Business Overview 59 ​ ​ C. Organizational Structure 69 ​ ​ D. Property, Plants and Equipment 69 ​ ITEM 4A UNRESOLVED STAFF COMMENTS 69 ​ ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS 70 ​ ​ A. Operating Results 70 ​ ​ B.
History and Development of the Company 60 ​ ​ B. Business Overview 61 ​ ​ C. Organizational Structure 70 ​ ​ D. Property, Plants and Equipment 70 ​ ITEM 4A UNRESOLVED STAFF COMMENTS 70 ​ ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS 70 ​ ​ A. Operating Results 71 ​ ​ B.
Liquidity and Capital Resources 78 ​ ​ C. Research and Development, Patents and Licenses 81 ​ ​ D. Trend Information 81 ​ ​ E. Critical Accounting Estimates 81 ​ ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES 83 ​ ​ A. Executive Officers and Directors 83 ​ ​ B. Compensation 85 ​ ​ C.
Liquidity and Capital Resources 78 ​ ​ C. Research and Development, Patents and Licenses 82 ​ ​ D. Trend Information 82 ​ ​ E. Critical Accounting Estimates 82 ​ ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES 84 ​ ​ A. Executive Officers and Directors 84 ​ ​ B. Compensation 86 ​ ​ C.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Our failure to successfully manage these risks could harm our international operations and have an adverse effect on our business, financial condition, and results of operations. Our failure to successfully manage these risks could harm our international operations and have an adverse effect on our business, financial condition, and results of operations.
Our failure to successfully manage these risks could harm our international operations and have an adverse effect on our business, financial condition, and results of operations.
For example, Illinois’ Biometric Information Privacy Act (“BIPA”), prohibits collection of certain biometric data without informed consent and provides for statutory damages of up to $5,000 per customer per violation for intentional violations. As a result, BIPA has been the subject of extensive class action litigation and very substantial settlements.
For example, Illinois’ Biometric Information Privacy Act (“BIPA”) prohibits the collection of certain biometric data without informed consent and provides for statutory damages of up to $5,000 per customer per violation for intentional violations. As a result, BIPA has been the subject of extensive class action litigation and very substantial settlements.
The trading market for our Class A ordinary shares relies in part on the research and reports that securities analysts publish about us and our business. The analysts’ estimates are based upon their own opinions and are often different from our estimates or expectations. We do not have any control over these analysts.
The trading market for our Class A ordinary shares relies in part on the research and reports that securities analysts publish about us and our business. These analysts’ estimates are based upon their own opinions and are often different from our estimates or expectations. We do not have any control over these analysts.
An active trading market for our Class A ordinary may not be sustained. The lack of an active market may impair your ability to sell your shares at the time you wish to sell them or at a price that you consider reasonable.
An active trading market for our Class A ordinary shares may not be sustained. The lack of an active market may impair your ability to sell your shares at the time you wish to sell them or at a price that you consider reasonable.
Any determination that our operations or activities, or the activities of our employees, are not in compliance with existing laws, regulations, or standards could negatively impact us in a number of ways, including the imposition of substantial fines, civil and criminal penalties, interruptions of business, loss of supplier, vendor, or other third-party relationships, termination of necessary licenses and permits, modification of business practices and compliance programs, equitable remedies, including disgorgement, injunctive relief, and other sanctions or similar results, all of which could adversely our business, financial condition, and results of operations.
Any determination that our operations or activities, or the activities of our employees, are not in compliance with existing laws, regulations, or standards could negatively impact us in a number of ways, including the imposition of substantial fines, civil and criminal penalties, interruptions of business, loss of supplier, vendor, or other third-party relationships, termination of necessary licenses and permits, modification of business practices and compliance programs, equitable remedies, including disgorgement, injunctive relief, and other sanctions or similar results, all of which could adversely affect our business, financial condition, and results of operations.
If we collect, use or store biometric data, we may be, or may become, subject to such laws and regulations, and we may face legal claims or proceedings, regulatory investigations or actions, or other liability in connection with any actual or perceived non-compliance, which could result in an adverse impact on our business, financial condition and results of operations.
If we collect, use or store such biometric or health data, we may be, or may become, subject to such laws and regulations, and we may face legal claims or proceedings, regulatory investigations or actions, or other liability in connection with any actual or perceived non-compliance, which could result in an adverse impact on our business, financial condition and results of operations.
Although the length, impact and outcome of the ongoing military conflict in Ukraine is highly unpredictable, this conflict could lead to significant market and other disruptions, including significant volatility in commodity prices and supply of energy resources, resulting in increases in the cost of shipping and transportation, instability in financial markets, supply chain interruptions, political and social instability, changes in consumer or purchaser preferences as well as increase in cyberattacks and espionage. 55 Table of Contents Russia’s military action against Ukraine has led to an unprecedented expansion of sanction programs imposed by the United States, the European Union, the United Kingdom, Canada, Switzerland, Japan and other countries against Russia, Belarus, the Crimea Region of Ukraine, the so-called Donetsk People’s Republic and the so-called Luhansk People’s Republic regions of Ukraine, and the non-government controlled areas of the Zaporizhzhia and Kherson regions of Ukraine.
Although the length, impact and outcome of the ongoing military conflict in Ukraine is highly unpredictable, this conflict could lead to significant market and other disruptions, including significant volatility in commodity prices and supply of energy resources, resulting in increases in the cost of shipping and transportation, instability in financial markets, supply chain interruptions, political and social instability, changes in consumer or purchaser preferences as well as increase in cyberattacks and espionage. 57 Table of Contents Russia’s military action against Ukraine has led to an unprecedented expansion of sanction programs imposed by the United States, the European Union, the United Kingdom, Canada, Switzerland, Japan and other countries against Russia, Belarus, the Crimea Region of Ukraine, the so-called Donetsk People’s Republic and the so-called Luhansk People’s Republic regions of Ukraine, and the non-government controlled areas of the Zaporizhzhia and Kherson regions of Ukraine.
Bribery Act”), by us, our employees, and our business partners; ● complexity and other risks associated with current and future legal requirements in other countries, including legal requirements related to consumer advertising protection, consumer product safety, AI and data privacy and security frameworks, including, but not limited to, the EU General Data Protection Regulation 2016/679 (“GDPR”), the EU-U.S.
Bribery Act”), by us, our employees, and our business partners; ● complexity and other risks associated with current and future legal requirements in other countries, including legal requirements related to consumer advertising protection, consumer product safety, AI and data privacy and security frameworks, including, but not limited to, the EU’s General Data Protection Regulation 2016/679 (“GDPR”), the EU-U.S.
In recent years, the U.S. government has taken steps to address allegations of forced labor in the Xinjiang Uyghur Autonomous Region of China (the “XUAR”), including issuing a number of specific Withhold Release Orders (which ban imports from certain entities or certain categories of ties into the United States) and implementing the Uyghur Forced Labor Prevention Act (the “UFLPA”), which creates a rebuttable presumption banning imports into the United States of items “mined, produced, or manufactured wholly or in part” in the XUAR, as well as additional presumptive bans that will be announced later this year.
In recent years, the U.S. government has taken steps to address allegations of forced labor in the Xinjiang Uyghur Autonomous Region of China (the “XUAR”), including issuing a number of specific Withhold Release Orders (which ban imports from certain entities or certain categories of items into the United States) and implementing the Uyghur Forced Labor Prevention Act, which creates a rebuttable presumption banning imports into the United States of items “mined, produced, or manufactured wholly or in part” in the XUAR, as well as additional presumptive bans that will be announced later this year.
Similar laws have been proposed in other states and at the federal level, reflecting a trend toward more stringent privacy legislation in the United States, and the enactment of such laws could have potentially conflicting requirements that would make compliance challenging.
Similar laws have been proposed in other states and at the federal level, reflecting a trend toward more stringent privacy legislation in the United States, and the enactment of such laws could impose potentially conflicting requirements that would make compliance challenging.
For example, if our AI models fail to accurately analyze facial and hair features, or any of the other components of our advanced computer vision fail, we may experience higher than forecasted returns, and our ability to attract new customers, retain existing customers, or increase sales of our products to existing customers and our business, financial condition, and results of operations may be adversely affected. 19 Table of Contents Our AI models are designed to utilize statistical, physics-based, and/or vision-based models to match users to specific products with high accuracy.
For example, if our AI models fail to accurately analyze facial and hair features, or any of the other components of our advanced computer vision fail, we may experience higher than forecasted returns, and our ability to attract new customers, retain existing customers, or increase sales of our products to existing customers and our business, financial condition, and results of operations may be adversely affected. 20 Table of Contents Our AI models are designed to utilize statistical, physics-based, and/or vision-based models to match users to specific products with high accuracy.
There are also other risks and costs inherent in doing business in international markets, including: ● the need to adapt and localize products for specific countries to account for, among other things, different cultural tastes, size and fit preferences, or regulatory requirements; ● difficulty establishing and managing international operations and the increased operations, travel, infrastructure, including establishment of local delivery service and customer service operations, and legal compliance costs associated with locations in different countries or regions; ● increased shipping times to and from international markets; ● the need to vary pricing and margins to effectively compete in international markets; ● increased competition from local providers of similar products; ● difficulty obtaining, maintaining, protecting, defending, and enforcing intellectual property rights abroad; ● the need to offer customer services in various languages; ● difficulties in understanding and complying with local laws, regulations, and customs in other jurisdictions; ● compliance with anti-bribery laws, such as the U.S.
There are also other risks and costs inherent in doing business in international markets, including: ● the need to adapt and localize products for specific countries to account for, among other things, different cultural tastes, size and fit preferences, or regulatory requirements; 15 Table of Contents ● difficulty establishing and managing international operations and the increased operations, travel, infrastructure, including establishment of local delivery service and customer service operations, and legal compliance costs associated with locations in different countries or regions; ● increased shipping times to and from international markets; ● the need to vary pricing and margins to effectively compete in international markets; ● increased competition from local providers of similar products; ● difficulty obtaining, maintaining, protecting, defending, and enforcing intellectual property rights abroad; ● the need to offer customer services in various languages; ● difficulties in understanding and complying with local laws, regulations, and customs in other jurisdictions; ● compliance with anti-bribery laws, such as the U.S.
These reasons include those described in these risk factors as well as the following: ● our ability to effectively launch new brands and products; ● fluctuations in the levels or quality of inventory; ● fluctuations in capacity as we expand our operations; ● our success in engaging existing customers and attracting new customers; ● the amount and timing of our operating expenses; ● the timing and success of new product launches and expansion into new geographic markets; ● the impact of competitive developments and our response to those developments; ● our ability to manage our existing business and future growth; and ● economic and market conditions, particularly those affecting our industry.
These reasons include those described in these risk factors as well as the following: ● our ability to effectively launch new brands and products; ● fluctuations in the levels or quality of inventory; ● fluctuations in capacity as we expand our operations; ● our success in engaging existing customers and attracting new customers cost-efficiently; ● the amount and timing of our operating expenses; ● the timing and success of new product launches and expansion into new geographic markets; ● the impact of competitive developments and our response to those developments; ● our ability to manage our existing business and future growth; and ● economic and market conditions, particularly those affecting our industry.
Like other e-commerce companies, we are also vulnerable to damage from fire, floods, hurricanes, earthquakes, natural disasters and other adverse weather conditions, public health emergencies (such as the COVID-19 pandemic) and other catastrophic events, military or political conflicts, power loss, terrorism, breaches, attacks by computer hackers, malicious code (such as malware, viruses and worms), ransomware attacks, insider threats, unauthorized activity or access, password-spraying, acts of vandalism, software or hardware vulnerabilities, employee or contractor theft, misplaced or lost data, fraud, misconduct or misuse, social engineering, phishing, denial-of-service attacks, organized cyberattacks, programming or human errors, telecommunication failures, or failures during the process of upgrading or replacing software, databases, or components.
Like other e-commerce companies, we are also vulnerable to damage from fire, floods, hurricanes, earthquakes, natural disasters and other adverse weather conditions, public health emergencies and other catastrophic events, military or political conflicts, power loss, terrorism, breaches, attacks by computer hackers, malicious code (such as malware, viruses and worms), ransomware attacks, insider threats, unauthorized activity or access, password-spraying, acts of vandalism, software or hardware vulnerabilities, employee or contractor theft, misplaced or lost data, fraud, misconduct or misuse, social engineering, phishing, denial-of-service attacks, organized cyberattacks, programming or human errors, telecommunication failures, or failures during the process of upgrading or replacing software, databases, or components.
Even if such tariffs do not directly apply to our supplies or products, they could indirectly affect our business if they result in a general increase in prices or an increase in prices by our third-party suppliers.
Even if such tariffs do not directly apply to our supplies or products, they could indirectly affect our business if they result in a general increase in prices or an increase in prices charged by our third-party suppliers.
Sales by us or our shareholders of a substantial number of Class A ordinary shares, including Class B ordinary shares, which will automatically convert into Class A ordinary shares upon transfer, in the public market, or the perception that these sales might occur, could cause the market price of our Class A ordinary shares to decline or could impair our ability to raise capital through a future sale of, or pay for acquisitions using, our equity securities. 50 Table of Contents We do not currently intend to pay dividends for the foreseeable future.
Sales by us or our shareholders of a substantial number of Class A ordinary shares, including Class B ordinary shares, which will automatically convert into Class A ordinary shares upon transfer, in the public market, or the perception that these sales might occur, could cause the market price of our Class A ordinary shares to decline or could impair our ability to raise capital through a future sale of, or pay for acquisitions using, our equity securities. 52 Table of Contents We do not currently intend to pay dividends for the foreseeable future.
Moreover, failure of our suppliers to comply with applicable laws and regulations and contractual requirements could lead to litigation against us or cause us to seek other vendors, which could increase our costs and result in delayed delivery of our products, product shortages, or other disruptions of our operations. 18 Table of Contents Ethical business practices are also driven in part by legal developments and by groups active in publicizing and organizing public responses to perceived ethical shortcomings.
Moreover, failure of our suppliers to comply with applicable laws and regulations and contractual requirements could lead to litigation against us or cause us to seek other vendors, which could increase our costs and result in delayed delivery of our products, product shortages, or other disruptions of our operations. 19 Table of Contents Ethical business practices are also driven in part by legal developments and by groups active in publicizing and organizing public responses to perceived ethical shortcomings.
There can be no assurance that we will not be forced to engage in price-cutting initiatives or to increase our marketing and other expenses to attract customers in response to competitive or other pressures.
There can be no assurance that we will not be forced to engage in price-cutting initiatives or to increase our marketing and other expenses to attract customers in response to competitive or other external pressures.
Any inquiry into the regulatory status of our products and any related interruption in the marketing and sales of these products could damage our reputation and image in the marketplace, which could adversely affect our business, financial condition and results of operations. 26 Table of Contents If our products are not manufactured in compliance with applicable regulations, do not meet quality standards, or otherwise result in adverse health effects in customers, it could result in reputational harm, remedial costs, or regulatory enforcement.
Any inquiry into the regulatory status of our products and any related interruption in the marketing and sales of these products could damage our reputation and image in the marketplace, which could adversely affect our business, financial condition and results of operations. 28 Table of Contents If our products are not manufactured in compliance with applicable regulations, do not meet quality standards, or otherwise result in adverse health effects in customers, it could result in reputational harm, remedial costs, or regulatory enforcement.
Additionally, difficulties with implementing new technology systems, delays in our timeline for planned improvements, significant system failures, or our inability to successfully modify our information systems to respond to changes in our business needs may cause disruptions in our business operations and adversely affect our business, financial condition, and results of operations. 42 Table of Contents Our use of open -source software could compromise the proprietary nature of our software and expose us to other legal liabilities and technological risks.
Additionally, difficulties with implementing new technology systems, delays in our timeline for planned improvements, significant system failures, or our inability to successfully modify our information systems to respond to changes in our business needs may cause disruptions in our business operations and adversely affect our business, financial condition, and results of operations. 44 Table of Contents Our use of open -source software could compromise the proprietary nature of our software and expose us to other legal liabilities and technological risks.
Our failure to successfully complete the integration of any acquired business or to achieve the long-term plan for such business, as well as any other adverse consequences associated with our acquisition and investment activities, could have an adverse effect on our business. 53 Table of Contents We are not insured against all risks affecting our activities and our insurance coverage may not be sufficient to cover all losses and/or liabilities that may be incurred by our operations.
Our failure to successfully complete the integration of any acquired business or to achieve the long-term plan for such business, as well as any other adverse consequences associated with our acquisition and investment activities, could have an adverse effect on our business. 55 Table of Contents We are not insured against all risks affecting our activities and our insurance coverage may not be sufficient to cover all losses and/or liabilities that may be incurred by our operations.
We are continuing to develop and refine our disclosure controls and other procedures that are designed to ensure that information required to be disclosed by us in the reports that we will file with the SEC is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms and that information required to be disclosed in reports under the Exchange Act is accumulated and communicated to our principal executive and financial officers. 56 Table of Contents We are continuing to improve our internal control over financial reporting.
We are continuing to develop and refine our disclosure controls and other procedures that are designed to ensure that information required to be disclosed by us in the reports that we will file with the SEC is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms and that information required to be disclosed in reports under the Exchange Act is accumulated and communicated to our principal executive and financial officers. 58 Table of Contents We are continuing to improve our internal control over financial reporting.
Despite our efforts to maintain our source code and certain other technologies as trade secrets, it may still be possible for unauthorized third parties to copy our technologies, including our PowerMatch capabilities, and use information that we regard as proprietary to create products and services that compete with ours. 39 Table of Contents We enter into confidentiality and invention assignment agreements with our employees and consultants and enter into confidentiality agreements with other parties who may have access to confidential or proprietary information.
Despite our efforts to maintain our source code and certain other technologies as trade secrets, it may still be possible for unauthorized third parties to copy our technologies, including our PowerMatch capabilities, and use information that we regard as proprietary to create products and services that compete with ours. 41 Table of Contents We enter into confidentiality and invention assignment agreements with our employees and consultants and enter into confidentiality agreements with other parties who may have access to confidential or proprietary information.
We may be required to spend significant amounts of resources to defend against claims of infringement, misappropriation, or other violation, pay significant money damages, cease using certain processes, technologies, designs, trademarks, or other intellectual property, cease making, offering, and selling certain products, obtain a license (which may not be available on commercially reasonable terms or at all) or redesign our brand, our products, or our packaging (which could be costly, time-consuming, or impossible).
We may be required to spend significant amounts of resources to defend against claims of infringement, misappropriation, or other violation, pay significant money damages, cease using certain processes, technologies, designs, trademarks, or other intellectual property, cease making, offering, and selling certain products, obtain a license (which may not be available on commercially reasonable terms or at all) or redesign our brands, our products, or our packaging (which could be costly, time-consuming, or impossible).
Further, regulators are increasingly focused on companies that use, or hold themselves out as using, AI and related technologies, and related enforcement actions may increase, including outside the financial sector.
Regulators are increasingly focused on companies that use, or hold themselves out as using, AI and related technologies, and related enforcement actions may increase, including outside the financial sector.
Our efforts to enforce or protect our trademarks, trade names, and domain names may be ineffective, may impact the public perception of our brand, may be expensive, may divert our resources, and, if our proprietary rights are challenged in connection with such enforcement efforts, could result in payment by us of monetary damages or injunctive relief against us that prevents us from using certain trademarks and trade names, all of which could adversely impact our financial condition or results of operations.
Our efforts to enforce or protect our trademarks, trade names, and domain names may be ineffective, may impact the public perception of our brands, may be expensive, may divert our resources, and, if our proprietary rights are challenged in connection with such enforcement efforts, could result in payment by us of monetary damages or injunctive relief against us that prevents us from using certain trademarks and trade names, all of which could adversely impact our financial condition or results of operations.
If companies or governmental entities block, limit, or otherwise restrict customers from accessing our products and services, our business could be negatively impacted, the number of customers could decline or grow more slowly, and our results of operations could be adversely affected. 43 Table of Contents Our customer engagement on mobile devices depends upon effective operation with mobile operating systems, networks, and standards that we do not control.
If companies or governmental entities block, limit, or otherwise restrict customers from accessing our products and services, our business could be negatively impacted, the number of customers could decline or grow more slowly, and our results of operations could be adversely affected. 45 Table of Contents Our customer engagement on mobile devices depends upon effective operation with mobile operating systems, networks, and standards that we do not control.
Such changes may affect our ability to attract or hire qualified non-U.S. employees to our offices in New York and Boston, including employees with specialized technical expertise.
Such changes may affect our ability to attract or hire qualified non-U.S. employees to our offices in New York and Boston, including employees with specialized technical and scientific expertise.
As a U.S. listed public company that is not a foreign private issuer, we will incur significant additional legal, accounting and other expenses that we will not incur as a foreign private issuer. 51 Table of Contents As we are a “foreign private issuer” and intend to follow certain home country corporate governance practices, our shareholders may not have the same protections afforded to shareholders of companies that are subject to all corporate governance rules of Nasdaq.
As a U.S. listed public company that is not a foreign private issuer, we will incur significant additional legal, accounting and other expenses that we will not incur as a foreign private issuer. 53 Table of Contents As we are a “foreign private issuer” and intend to follow certain home country corporate governance practices, our shareholders may not have the same protections afforded to shareholders of companies that are subject to all corporate governance rules of Nasdaq.
Therefore, it is possible that our trademarks applications may not be allowed for registration in a timely fashion or at all, and our registered trademarks may not be maintained or enforced.
Therefore, it is possible that our trademark applications may not be allowed for registration in a timely fashion or at all, and our registered trademarks may not be maintained or enforced.
You should not rely on the results of one quarter as an indication of future performance. 54 Table of Contents Certain of our operating metrics are subject to inherent challenges in measurement, and any real or perceived inaccuracies in our metrics or the underlying data may cause a loss of investor confidence in such metrics and the market price of our Class A ordinary shares may decline.
You should not rely on the results of one quarter as an indication of future performance. 56 Table of Contents Certain of our operating metrics are subject to inherent challenges in measurement, and any real or perceived inaccuracies in our metrics or the underlying data may cause a loss of investor confidence in such metrics and the market price of our Class A ordinary shares may decline.
If we do not help our customers quickly resolve issues and provide effective ongoing support, or we are unable to achieve or maintain a high level of customer satisfaction, we could experience more complaints from customers, lower than expected repeat purchases, disputes and additional costs, or negative publicity, any of which could have an adverse effect on our business, financial condition, and results of operations. 20 Table of Contents We may need additional capital, and we cannot be sure that additional financing will be available on favorable terms, if at all.
If we do not help our customers quickly resolve issues and provide effective ongoing support, or we are unable to achieve or maintain a high level of customer satisfaction, we can experience more complaints from customers, lower than expected repeat purchases, disputes and additional costs, or negative publicity, any of which could have an adverse effect on our business, financial condition, and results of operations. 21 Table of Contents We may need additional capital, and we cannot be sure that additional financing will be available on favorable terms, if at all.
Any inquiry into the regulatory status of our products and any related interruption in the marketing and sale of these products could damage our reputation and image in the marketplace. 25 Table of Contents Other U.S. regulatory authorities, such as the FTC and state consumer protection agencies, also govern our products and typically require adequate and reliable scientific substantiation to support any marketing claims.
Any inquiry into the regulatory status of our products and any related interruption in the marketing and sale of these products could damage our reputation and image in the marketplace. 27 Table of Contents Other U.S. regulatory authorities, such as the FTC and state consumer protection agencies, also govern our products and typically require adequate and reliable scientific substantiation to support any marketing claims.
For further discussion, see the section titled “Item 10.E Taxation—Passive Foreign Investment Company.” 52 Table of Contents If a United States person is treated as owning 10% or more of our shares, such holder may be subject to adverse U.S. federal income tax consequences.
For further discussion, see the section titled “Item 10.E Taxation—Passive Foreign Investment Company.” 54 Table of Contents If a United States person is treated as owning 10% or more of our shares, such holder may be subject to adverse U.S. federal income tax consequences.
We are required to comply with the SEC’s rules implementing Sections 302 and 404 of the Sarbanes-Oxley Act, requiring management to certify financial and other information in our annual reports and, beginning with this Annual Report, to provide an annual management report on the effectiveness of control over financial reporting and an attestation report on internal control over financial reporting issued by our independent registered public accounting firm.
We are required to comply with the SEC’s rules implementing Sections 302 and 404 of the Sarbanes-Oxley Act, requiring management to certify financial and other information in our annual reports and to provide an annual management report on the effectiveness of control over financial reporting and an attestation report on internal control over financial reporting issued by our independent registered public accounting firm.
Our business depends on our ability to maintain a strong base of engaged customers and content creators, including through the use of social media.
Our business depends on our ability to maintain a strong base of engaged customers and content creators, including through the use of social media platforms.
Operating with integrity is core to our values, which makes our reputation sensitive to allegations of unethical or improper business practices, whether real or perceived. The failure of any of our suppliers to provide safe and humane factory conditions and oversight at their facilities could damage our reputation and brand or result in legal claims against us.
Operating with integrity is core to our values, which makes our reputation sensitive to allegations of unethical or improper business practices, whether real or perceived. The failure of any of our suppliers to provide safe and humane factory conditions and oversight at their facilities could damage our reputation and brands or result in legal claims against us.
We operate currently in several jurisdictions in addition to Israel, including the United States. In the event that our business expands to additional jurisdictions, our effective tax rates may fluctuate widely in the future. Future effective tax rates could be affected by operating losses in jurisdictions where no tax benefit can be recorded under U.S.
We operate currently in several jurisdictions in addition to Israel, including the United States and the U.K. In the event that our business expands to additional jurisdictions, our effective tax rates may fluctuate widely in the future. Future effective tax rates could be affected by operating losses in jurisdictions where no tax benefit can be recorded under U.S.
A violation of these applicable laws could adversely affect our business, prospects, financial condition, and results of operations. 29 Table of Contents Our ability to source and distribute our products profitably or at all could be harmed if new trade restrictions are imposed or existing trade restrictions become more burdensome.
A violation of these applicable laws could adversely affect our business, prospects, financial condition, and results of operations. 31 Table of Contents Our ability to source and distribute our products profitably or at all could be harmed if new trade restrictions are imposed or existing trade restrictions become more burdensome.
If we fail to obtain, maintain, protect, defend, and enforce our intellectual property rights, our business, financial condition, or results of operations may be harmed. 40 Table of Contents If our trademarks and trade names are not adequately protected, we may not be able to maintain or build name recognition in our markets of interest.
If we fail to obtain, maintain, protect, defend, and enforce our intellectual property rights, our business, financial condition, or results of operations may be harmed. 42 Table of Contents If our trademarks and trade names are not adequately protected, we may not be able to maintain or build name recognition in our markets of interest.
Any of the foregoing could adversely affect our business, financial condition, and results of operations. 41 Table of Contents Proceedings to enforce our intellectual property rights in foreign jurisdictions, whether or not successful, could result in substantial costs and divert efforts and resources from other aspects of our business.
Any of the foregoing could adversely affect our business, financial condition, and results of operations. 43 Table of Contents Proceedings to enforce our intellectual property rights in foreign jurisdictions, whether or not successful, could result in substantial costs and divert efforts and resources from other aspects of our business.
Even isolated incidents involving us, suppliers or third-party service providers, or the products we sell, could erode the trust and confidence of our customers and damage the strength of our brands, especially if such incidents result in adverse publicity, governmental investigations, product recalls, or litigation.
Even isolated incidents involving us, suppliers or third-party service providers, or the products we sell, can erode the trust and confidence of our customers and damage the strength of our brands, especially if such incidents result in adverse publicity, governmental investigations, product recalls, or litigation.
For example, in the EU, the AI Act (the “EU AI Act”), on which the European Council and Parliament reached political agreement in December 2023, entered into force on August 1, 2024, and certain regulations had to be complied with as early as February 2, 2025.
For example, the EU AI Act, on which the European Council and Parliament reached political agreement in December 2023, entered into force on August 1, 2024, and certain regulations had to be complied with as early as February 2, 2025.
We also have a “Try Before You Buy” program whereby customers choose several similar products for a trial and initially pay only shipping costs, paying only for the products they keep after the trial period. Our net revenue is reported net of discounts and estimated returns.
We also have a “Try Before You Buy” program whereby customers choose products for a trial and initially pay only shipping costs, paying only for the products they keep after the trial period. Our net revenue is reported net of discounts and estimated returns.
Furthermore, we currently own trademarks that we use in connection with our business in the United States, Israel, and other markets. As we continue to expand into international markets, we may experience certain risks associated with protecting our brand and maintaining the ability to use our brand in the countries where we operate.
Furthermore, we currently own trademarks that we use in connection with our business in the United States, Israel, and other markets. As we continue to expand into international markets, we may experience certain risks associated with protecting our brands and maintaining the ability to use our brands in the countries where we operate.
Based on our market capitalization and the composition of our income, assets, and operations, we believe that we are not a PFIC for the year ended December 31, 2024 and do not expect to be a PFIC for the current taxable year or in the foreseeable future.
Based on our market capitalization and the composition of our income, assets, and operations, we believe that we are not a PFIC for the year ended December 31, 2025 and do not expect to be a PFIC for the current taxable year or in the foreseeable future.
Accordingly, because of the inherent limitations in our control system, misstatements due to error or fraud may occur and not be detected. ​ 57 Table of Contents Our reported financial results may be negatively impacted by changes in U.S. GAAP. U.S.
Accordingly, because of the inherent limitations in our control system, misstatements due to error or fraud may occur and not be detected. ​ 59 Table of Contents Our reported financial results may be negatively impacted by changes in U.S. GAAP. U.S.
Our continued success depends on our ability to anticipate, gauge, and react in a timely and cost-effective manner to changes in consumer tastes for beauty and wellness products, attitudes toward our industry and brand, as well as to where and how consumers shop.
Our continued success depends on our ability to anticipate, gauge, and react in a timely and cost-effective manner to changes in consumer tastes for beauty and wellness products, attitudes toward our industry and brands, as well as to where and how consumers shop.
Any failure by us or our suppliers to comply with ethical business practices or product safety, labor, or other laws, provide safe conditions for our or their workers, or use or be transparent about ethical business practices may damage our reputation and brand and harm our business.
Any failure by us or our suppliers to comply with ethical business practices or product safety, labor, or other laws, provide safe conditions for our or their workers, or use or be transparent about ethical business practices may damage our reputation and brands and harm our business.
Consumers could confuse counterfeit products with our authentic products, which could damage or diminish the image, reputation and/or value of our brand, and cause consumers to refrain from purchasing our products in the future, which could adversely affect our reputation, business, financial condition, and results of operations.
Consumers could confuse counterfeit products with our authentic products, which could damage or diminish the image, reputation and/or value of our brands, and cause consumers to refrain from purchasing our products in the future, which could adversely affect our reputation, business, financial condition, and results of operations.
Our competitors, some of whom have greater resources than we do, may also be able to benefit from changes in e-commerce technologies, which could harm our competitive position. We are subject to financial risks as a result of our international operations and investing activities, including exposure to foreign currency fluctuations and the impact of foreign currency restrictions.
Our competitors, some of whom have greater resources than we do, may also be able to benefit from changes in e-commerce technologies, which could harm our competitive position. 17 Table of Contents We are subject to financial risks as a result of our international operations and investing activities, including exposure to foreign currency fluctuations and the impact of foreign currency restrictions.
We may not be able to maintain and enhance our brand if we experience negative publicity related to our marketing efforts or use of social media, fail to maintain and grow our network of content creators, or otherwise fail to meet our customers’ expectations.
We may not be able to maintain and enhance our brands if we experience negative publicity related to our marketing efforts or use of social media, fail to maintain and grow our network of content creators, or otherwise fail to meet our customers’ expectations.
If we do not meet the expectations of securities analysts, if they cease to publish research or reports about our business, or if they issue unfavorable commentary or downgrade our ordinary shares, the price of our Class A ordinary shares could decline.
If in the future we do not meet the expectations of securities analysts, if they cease to publish research or reports about our business, or if they issue unfavorable commentary or downgrade our ordinary shares, the price of our Class A ordinary shares could decline.
Negative commentary regarding us, our products, our content creators, or other third parties, whether accurate or not, may be posted on social media platforms at any time and may adversely affect our reputation, brand, and business.
Negative commentary regarding us, our products, our content creators, or other third parties, whether accurate or not, may be posted on social media platforms at any time and may adversely affect our reputation, brands, and business.
Content that is adverse to our interests, whether or not accurate or truthful, could be posted to social media platforms and other platforms and immediately disseminated to broad audiences without any filter or verification of such content.
Content that is adverse to our interests, whether or not accurate or truthful, can be posted to social media platforms and other platforms and immediately disseminated to broad audiences without any filter or verification of such content.
These state statutes and other similar state or federal laws may require us to modify our data processing practices and policies and incur substantial compliance-related costs and expenses. A number of states have also passed, or may pass in the future, laws that regulate the acquisition, use and storage of biometric information.
These state statutes and other similar state or federal laws may require us to modify our data processing practices and policies and incur substantial compliance-related costs and expenses. A number of U.S. states have also passed, or may pass in the future, laws that regulate the acquisition, use and storage of biometric information or health data.
In the past, we have been able to obtain an adequate supply of our finished products on a purchase order basis and currently believe we have an adequate supply for virtually all components of our products. However, we may encounter supply issues with raw materials due to increases in global demand and limited supply capacity.
In the past, we have been able to obtain an adequate supply of our finished products on a purchase order basis and currently believe we have an adequate supply for virtually all components of our products. However, we may encounter supply issues with raw materials, product formulations and packaging due to increases in global demand and limited supply capacity.
We may also encounter difficulty expanding into new markets because of limited brand recognition in those markets, leading to delayed acceptance of our products by consumers there. In particular, we have no assurance that our marketing efforts will prove successful outside of the Israel and the United States.
We may also encounter difficulty expanding into new markets because of limited brand recognition in those markets, leading to delayed acceptance of our products by consumers there. In particular, we have no assurance that our marketing efforts will prove successful outside of Israel, the U.K., the EU and the United States.
If we are unable to manage the growth of our organization effectively, our business, financial condition, and results of operations may be adversely affected. A general economic downturn, or sudden disruption in business conditions may affect consumer purchases of discretionary items and/or the financial strength of our customers, which would adversely affect our business, financial condition, and results of operations.
If we are unable to manage the growth of our organization effectively, our business, financial condition, and results of operations may be adversely affected. 12 Table of Contents A general economic downturn, or sudden disruption in business conditions may affect consumer purchases of discretionary items and/or the financial strength of our customers, which would adversely affect our business, financial condition, and results of operations.
In addition, our ability to expand in any of our target markets depends on a number of factors, including the cost, performance, and perceived value associated with our products and other haircare products.
In addition, our ability to expand in any of our target markets depends on a number of factors, including the cost, performance, and perceived value associated with our products and other skincare products.
Our business is subject to numerous laws, regulations, and policies around the world, including but not limited to, the United States, Israel, the U.K., the EU European Union (the “EU”), and Australia. Many of these laws and regulations have a high level of subjectivity, are subject to interpretation and vary significantly from market to market.
Our business is subject to numerous laws, regulations, and policies around the world, including but not limited to, the United States, Israel, the U.K., the EU, and Australia. Many of these laws and regulations have a high level of subjectivity, are subject to interpretation and vary significantly from market to market.
Further, if we incur excessive expenses in this effort, our business, financial condition, and results of operations may be adversely affected. We and our content creators use third-party social media platforms to raise awareness of our brands and engage with our customers.
Further, if we incur excessive expenses in this effort, our business, financial condition, and results of operations may be adversely affected. 6 Table of Contents We and our content creators use third-party social media platforms to raise awareness of our brands and engage with our customers.
We are actively monitoring the situation in Ukraine and will continue to assess any impact it may have on our business. Although we have no physical presence in either Ukraine or Russia, as of December 31, 2024, we had contracts with approximately 100 Ukraine-based independent entrepreneurs who provide us with software development services.
We are actively monitoring the situation in Ukraine and will continue to assess any impact it may have on our business. Although we have no physical presence in either Ukraine or Russia, as of December 31, 2025, we had contracts with approximately 150 Ukraine-based independent entrepreneurs who provide us with software development services.
We anticipate the need to add additional distribution center capacity and lease new warehouse space to serve as distribution centers as our business continues to grow.
We anticipate the need to add additional distribution center capacity and lease new warehouse space to serve as distribution centers as our business continues to grow and as we launch new brands.
Our revenue growth may slow for a number of other reasons, including if we experience reduced demand for our products, increased competition, a decrease in the growth or reduction in the size of our overall market, or if we cannot capitalize on growth opportunities.
Our revenue growth may slow for a number of other reasons, including if we experience reduced demand for our products, increased competition, increased customer acquisition costs, a decrease in the growth or reduction in the size of our overall market, or if we cannot capitalize on growth opportunities.
The general level of consumer spending is affected by a number of factors, including general economic conditions, inflation, interest rates, energy costs, and consumer confidence generally, all of which are beyond our control. Consumer purchases of discretionary items tend to decline during recessionary periods, when disposable income is lower, and may impact sales of our products.
The general level of consumer spending is affected by a number of factors, including general economic conditions, inflation, interest rates, energy costs, and consumer confidence generally, all of which are beyond our control. Consumer purchases of discretionary items tend to decline during recessionary periods, when disposable income is lower.
We are currently involved in, and may in the future from time to time become involved in, litigation and other proceedings, including matters related to commercial disputes, product liability, intellectual property, data privacy and security, trade, customs laws and regulations, employment, regulatory compliance, and other claims related to our business. See the section titled “Item 4.B.
We are currently involved in, and may in the future from time to time become involved in, litigation and other proceedings, including matters related to commercial disputes, product liability, intellectual property, data privacy and security, trade, customs laws and regulations, employment, regulatory compliance, and other claims related to our business. See the section titled “Item 8.A.
Furthermore, we cannot predict the effect inflation, including wage inflation, may have on our distribution network and our ability to maintain operating efficiencies. 17 Table of Contents Our distribution centers include computer-controlled and automated equipment and rely on warehouse management systems to manage supply chain fulfillment operations, which means our operations are complicated and may be subject to a number of risks related to cybersecurity, the proper operation of software and hardware, electronic or power interruptions, or other system failures.
Furthermore, we cannot predict the effect inflation, including wage inflation, may have on our distribution network and our ability to maintain operating efficiencies. 18 Table of Contents Our distribution centers, which are operated by our warehousing vendors, include computer-controlled and automated equipment and rely on warehouse management systems to manage supply chain fulfillment operations, which means our operations are complicated and may be subject to a number of risks related to cybersecurity, the proper operation of software and hardware, electronic or power interruptions, or other system failures.
Additional Information—Articles of Association—Voting Rights” and Note 13 to our Consolidated Financial Statements. 49 Table of Contents We are a “controlled company” within the meaning of the rules of Nasdaq and, as a result, qualify for, and may rely on, exemptions from certain corporate governance requirements.
Additional Information—Articles of Association—Voting Rights” and Note 12 to our Consolidated Financial Statements. 51 Table of Contents We are a “controlled company” within the meaning of the rules of Nasdaq and, as a result, qualify for, and may rely on, exemptions from certain corporate governance requirements.
Certain of the component materials used in our products rely on a single or a limited number of suppliers. We acquire raw material and packaging from third-party suppliers and our finished products are assembled by third-party suppliers.
Certain of the component materials used in our products rely on a single or a limited number of suppliers. We acquire raw materials, product formulations and packaging from third-party suppliers and our finished products are assembled by third-party suppliers.
Failure to continue to grow our revenue or improve or maintain margins would adversely affect our business, financial condition, and results of operations. You should not rely on our historical rate of growth as an indication of our future performance. We operate in highly competitive categories.
Failure to grow our revenue or improve or maintain margins would adversely affect our business, financial condition, and results of operations. You should not rely on our historical rate of growth as an indication of our future performance. 10 Table of Contents We operate in highly competitive categories.
Any failure to obtain, maintain, protect, defend, or enforce our intellectual property rights could impair our ability to protect our proprietary technology and our brand.
Any failure to obtain, maintain, protect, defend, or enforce our intellectual property rights could impair our ability to protect our proprietary technology and our brands.
If any of these events were to occur, our business, results of operations, and financial condition could be materially adversely affected. 23 Table of Contents Regulatory and legislative developments related to climate change may materially adversely affect our business and financial condition.
If any of these events were to occur, our business, results of operations, and financial condition could be materially adversely affected. Regulatory and legislative developments related to climate change may materially adversely affect our business and financial condition.
If our revenue does not increase at a greater rate than our operating expenses, we will not be able to maintain our current level of profitability. 14 Table of Contents We have a limited operating history at our current scale, which may make it difficult to evaluate our business and future prospects.
If our revenue does not increase at a greater rate than our operating expenses, we will not be able to maintain our current level of profitability. We have a limited operating history at our current scale, which may make it difficult to evaluate our business and future prospects. We have a limited history of generating revenue at our current scale.
If we fail to follow applicable security standards even if no consumer information is compromised, we may incur significant fines or experience a significant increase in costs or reputational damage. Further, U.S. laws in this area are complex and developing rapidly.
If we fail to follow applicable security standards even if no consumer information is compromised, we may incur significant fines or experience a significant increase in costs or reputational damage. 33 Table of Contents Further, U.S. laws in this area are complex and developing rapidly.
Among other things: ● Israeli corporate law regulates mergers and requires that a tender offer be effected when more than a specified percentage of shares in a company are purchased; ● Israeli corporate law does not provide for shareholder action by written consent in public companies, thereby requiring all shareholder actions to be taken at a general meeting of shareholders; ● Israeli corporate law requires special approvals for transactions involving directors, officers, or significant shareholders and regulates other matters that may be relevant to these types of transactions; ● our amended and restated articles of association divide our directors into three classes, each of which is elected once every three years; ● our amended and restated articles of association generally require a vote of the holders of a majority of our outstanding ordinary shares entitled to vote present and voting on the matter at a general meeting of shareholders (referred to as simple majority); however, the amendment of a limited number of provisions, such as (i) the provisions that relate to the rights of our Class A ordinary shares and Class B ordinary shares, (ii) the provision providing for the minimum and maximum number of directors that may serve on our board of directors and empowering our board of directors to determine the size of the board of directors, (iii) the provision setting forth the procedures and the requirements that must be met in order for a shareholder to require us to include a matter on the agenda for a general meeting of our shareholders, (iv) the provisions relating to the election and removal of members of our board of directors and empowering our board of directors to fill vacancies on the board of directors, and (v) the provision dividing our directors into three classes, requires a vote of the holders of 60% of the total voting power of our shareholders; ● our amended and restated articles of association do not permit a director to be removed except by a vote of the holders of at least 60% of the total voting power of our shareholders; ● our dual class ordinary share structure provides our existing shareholders holding Class B ordinary shares with the ability to significantly influence the outcome of matters requiring shareholder approval, even if they own significantly less than a majority of our outstanding ordinary shares; and ● our amended and restated articles of association provide that director vacancies may be filled by our board of directors. 47 Table of Contents Further, Israeli tax considerations may make potential transactions undesirable to us or to some of our shareholders whose country of residence does not have a tax treaty with Israel granting tax relief to such shareholders from Israeli tax.
Among other things: ● Israeli corporate law regulates mergers and requires that a tender offer be effected when more than a specified percentage of shares in a company are purchased; ● Israeli corporate law does not provide for shareholder action by written consent in public companies, thereby requiring all shareholder actions to be taken at a general meeting of shareholders; ● Israeli corporate law requires special approvals for transactions involving directors, officers, or significant shareholders and regulates other matters that may be relevant to these types of transactions; ● our amended and restated articles of association divide our directors into three classes, each of which is elected once every three years; ● our amended and restated articles of association generally require a vote of the holders of a majority of our outstanding ordinary shares entitled to vote present and voting on the matter at a general meeting of shareholders (referred to as simple majority); however, the amendment of a limited number of provisions, such as (i) the provisions that relate to the rights of our Class A ordinary shares and Class B ordinary shares, (ii) the provision providing for the minimum and maximum number of directors that may serve on our board of directors and empowering our board of directors to determine the size of the board of directors, (iii) the provision setting forth the procedures and the requirements that must be met in order for a shareholder to require us to include a matter on the agenda for a general meeting of our shareholders, (iv) the provisions relating to the election and removal of members of our board of directors and empowering our board of directors to fill vacancies on the board of directors, and (v) the provision dividing our directors into three classes, requires a vote of the holders of 60% of the total voting power of our shareholders; ● our amended and restated articles of association do not permit a director to be removed except by a vote of the holders of at least 60% of the total voting power of our shareholders; ● our dual class ordinary share structure provides our existing shareholders holding Class B ordinary shares with the ability to significantly influence the outcome of matters requiring shareholder approval, even if they own significantly less than a majority of our outstanding ordinary shares; and ● our amended and restated articles of association provide that director vacancies may be filled by our board of directors.
Regardless of the final resolution, such proceedings may have an adverse effect on our reputation, financial condition, and business, including by utilizing our resources and potentially diverting the attention of our management from the operation of our business. See the section titled “Item 4.B.
Regardless of the final resolution, such proceedings may have an adverse effect on our reputation, financial condition, and business, including by utilizing our resources and potentially diverting the attention of our management from the operation of our business. See the section titled “Item 8.A.
Legal Proceedings.” The dual class structure of our ordinary shares has the effect of concentrating voting power with our co-founder and Chief Executive Officer, which will limit your ability to influence the outcome of important transactions, including a change in control.
Financial Information—Consolidated Statements and Other Financial Information—Legal Proceedings.” The dual class structure of our ordinary shares has the effect of concentrating voting power with our co-founder and Chief Executive Officer, which will limit your ability to influence the outcome of important transactions, including a change in control.
If we do not continue to introduce new products or innovations on existing products in a timely manner or our new brands or products are not accepted by our customers, or if our competitors introduce similar products in a more timely fashion, our brand or our market position could be harmed.
If we do not continue to introduce new products or innovations on existing products in a timely manner or our new brands or products are not accepted by our customers, or if our competitors introduce similar products before we do, our brands or our market position could be harmed.
As an example, the Organization for Economic Co-operation and Development (the “OECD”), has put forth two proposals—Pillar One and Pillar Two—that revise the existing profit allocation and nexus rules (profit allocation based on location of sales versus physical presence) and ensure a minimal level of taxation, respectively.
Additionally, the Organization for Economic Co-operation and Development, has put forth two proposals—Pillar One and Pillar Two—that revise the existing profit allocation and nexus rules (profit allocation based on location of sales versus physical presence) and ensure a minimal level of taxation, respectively.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Although the Green Guides and Endorsement Guides do not operate directly with the force of law, they provide guidance about what the FTC generally believes the Federal Trade Commission Act (“FTC Act”), requires in the context using of “green” claims and endorsements and testimonials in advertising.
Although the Green Guides and Endorsement Guides do not operate directly with the force of law, they provide guidance about what the FTC generally believes the Federal Trade Commission Act (“FTC Act”) requires in the context of using “green” claims and endorsements and testimonials in advertising.
We have built a holistic, end-to-end customer journey, with each of our user touchpoints seeking to enhance and optimize the overall experience. Our integrated model aims to eliminate significant friction, bringing discovery, product matching, tutorial, purchase, and repeat engagement under a single platform. It requires significant investments in technology talent, capabilities, and products.
We have built a holistic, end-to-end customer journey, with each of our user touchpoints seeking to enhance and optimize the overall customer experience. Our integrated model aims to eliminate significant friction, bringing discovery, product matching, tutorials, purchase, and repeat engagement under a single platform. It requires significant investments in technology talent, capabilities, and products.
Government Regulation Our products are subject to regulation by the FDA and the FTC in the United States, as well as various other local and foreign regulatory authorities, including those in the EU, and other countries in which we operate.
Government Regulation Our products are subject to regulation by the FDA and the FTC in the United States, as well as various other federal, state, local and foreign regulatory authorities, including those in the EU, and other countries in which we operate.
The SEC’s website is www.sec.gov. 58 Table of Contents B. Business Overview Who We Are We are a consumer tech platform that is built to transform the global beauty and wellness market.
The SEC’s website is www.sec.gov. 60 Table of Contents B. Business Overview Who We Are We are a consumer tech platform that is built to transform the global beauty and wellness market.
For information regarding risks related to our intellectual property and technology, please see the section titled “Item 3.D. Key Information—Risk Factors—Risks Related to Information Technology, Intellectual Property and Data Security and Privacy.” C. Organizational Structure We are a limited liability company formed under the laws of the State of Israel.
For information regarding risks related to our intellectual property and technology, please see the section titled “Item 3.D. Key Information—Risk Factors—Risks Related to Information Technology, Intellectual Property and Data Security and Privacy.” 69 Table of Contents C. Organizational Structure We are a limited liability company formed under the laws of the State of Israel.
A product may fall within the definition of both a cosmetic product and a medicinal product in which case the non-cumulation principle provides that the product will be regulated as a medicinal product (under the Medicinal Products Directive 2001/83/EC). Generally, there is no requirement for pre-market approval of cosmetic products in the EU.
A product may fall within the definition of both a cosmetic product and a medicinal product in which case the non-cumulation principle provides that the product will be regulated as a medicinal product (under the Medicinal Products Directive 2001/83/EC). 67 Table of Contents Generally, there is no requirement for pre-market approval of cosmetic products in the EU.
Any practices inconsistent with the Green Guides and Endorsement Guides can result in violations of the FTC Act’s proscription against unfair and deceptive practices. United States Regulation of Dietary Supplements Dietary Supplements The FDA has comprehensive authority to regulate dietary supplements, including their composition, labeling and manufacturing.
Any practices inconsistent with the Green Guides and Endorsement Guides can result in violations of the FTC Act’s proscription against unfair and deceptive practices. 66 Table of Contents United States Regulation of Dietary Supplements Dietary Supplements The FDA has comprehensive authority to regulate dietary supplements, including their composition, labeling and manufacturing.
We rely on expert consultants for our EU product registrations and review of our labeling for compliance with the EU Cosmetics Regulation. 67 Table of Contents The EU Cosmetics Regulation requires the manufacture of cosmetic products to comply with GMPs, which is presumed where the manufacture is in accordance with the relevant harmonized standards.
We rely on expert consultants for our EU product registrations and review of our labeling for compliance with the EU Cosmetics Regulation. The EU Cosmetics Regulation requires the manufacture of cosmetic products to comply with GMPs, which is presumed where the manufacture is in accordance with the relevant harmonized standards.
Our online platform supports a portfolio of stand-alone brands and served approximately 60 million users as of December 31, 2024. Our commitment to innovation through our proprietary technology is matched only by our commitment to developing empowering products of the highest quality, marrying the worlds of technology and physical beauty and wellness products for the benefit of consumers.
Our online platform supports a portfolio of stand-alone brands and served approximately 68 million users as of December 31, 2025. Our commitment to innovation through our proprietary technology is matched only by our commitment to developing empowering products of the highest quality, marrying the worlds of technology and physical beauty and wellness products for the benefit of consumers.
Internationally, virtually every jurisdiction in which we operate has established its own data privacy and security legal framework with which we must comply, including but not limited to the EEA, the U.K., and Israel. For example, the GDPR and the U.K.
Internationally, virtually every jurisdiction in which we operate has established its own data privacy and security legal framework with which we must comply, including but not limited to the EEA, the U.K., and Israel.
We believe that our ability to compete successfully depends primarily on the following factors: ● continuing to advance our technology platform; ● leveraging our data and AI capabilities; ● maintaining and attracting customers; ● developing and launching new products and transformative brands; ● responding to changing consumer demands in a timely manner; ● maintaining the value and reputation of our brand; ● attracting and retaining a team committed to innovation; ● effectiveness of our products; 64 Table of Contents ● accessible pricing; ● customer service; and ● effectiveness of our marketing strategies.
We believe that our ability to compete successfully depends primarily on the following factors: ● continuing to advance our technology platform; ● leveraging our data and AI capabilities; ● maintaining and attracting customers; ● developing and launching new products and transformative brands; ● responding to changing consumer demands in a timely manner; ● maintaining the value and reputation of our brands; ● attracting and retaining a team committed to innovation; ● effectiveness of our products; ● accessible pricing; ● customer service; and ● effectiveness and cost-effectiveness of our advertising and marketing strategies.
We believe that our existing facilities are sufficient for our current needs. We believe that suitable additional or substitute space will be available as needed to accommodate changes in our operations. ITEM 4A UNRESOLVED STAFF COMMENTS Not applicable. 69 Table of Contents
We believe that our existing facilities are sufficient for our current needs. We believe that suitable additional or substitute space will be available as needed to accommodate changes in our operations. ITEM 4A UNRESOLVED STAFF COMMENTS Not applicable.
We work hard to create an environment where our employees feel empowered, and live by our core mantras: ● We’re boldly unconstrained. ● We always outrun. ● We take big swings. ● We win every day. ● We never fit in.
We work hard to create an environment where our employees feel empowered, and live by our core mantras: ● We’re boldly unconstrained. ● We always outrun. 64 Table of Contents ● We take big swings. ● We win every day. ● We never fit in.
Property, Plants and Equipment ​ Our Facilities ​ We lease approximately 19,898 square feet in New York, New York, where we operate our U.S. headquarters, approximately 3,825 square feet in Boston, Massachusetts, where we operate ODDITY LABS, and approximately 9,365 square feet in Tel Aviv, Israel, where we operate our corporate headquarters.
Property, Plants and Equipment ​ Our Facilities ​ We lease approximately 23,674 square feet in New York, New York, where we operate our U.S. headquarters, approximately 3,825 square feet in Boston, Massachusetts, where we operate ODDITY LABS, and approximately 9,365 square feet in Tel Aviv, Israel, where we operate our corporate headquarters.
Operating and Financial Review and Prospects—Liquidity and Capital Resources—Capital Expenditures.” General Corporate Information ODDITY Tech Ltd. (formerly known as Il Makiage Cosmetics (2013) Ltd.) was incorporated on June 23, 2013 in Israel under the Companies Law. Our common shares have been listed on the Nasdaq since July 2023.
Capital Expenditures See the section titled “Item 5.B. Operating and Financial Review and Prospects—Liquidity and Capital Resources—Capital Expenditures.” General Corporate Information ODDITY Tech Ltd. (formerly known as Il Makiage Cosmetics (2013) Ltd.) was incorporated on June 23, 2013 in Israel under the Companies Law. Our common shares have been listed on Nasdaq since July 2023.
As a consequence, from January 1, 2021, Schedule 34 of the Product Safety and Metrology etc. (Amendment etc.) (EU Exit) Regulations 2019 (the “U.K. Cosmetics Regulation”), applies to cosmetic products placed on the market in Great Britain, which includes England, Scotland and Wales. Cosmetic products placed on the market in Northern Ireland are still covered by the EU Cosmetics Regulation.
As a consequence, from January 1, 2021, Schedule 34 of the Product Safety and Metrology etc. (Amendment etc.) (EU Exit) Regulations 2019 (the “U.K. Cosmetics Regulation”), applies to cosmetic products placed on the market in Great Britain, which includes England, Scotland and Wales.
State or Subsidiary Name ​ Other Jurisdiction of Incorporation or Organization IM PRO MAKEUP NY LP ​ New York SPOILEDCHILD INC. ​ Delaware ODDITY LABS LLC ​ Delaware ODDITY TECH US INC. ​ New York Il MAKIAGE BEAUTY IL LTD ​ Israel IL MAKIAGE GB LTD ​ United Kingdom VOYAGE81 LTD ​ Israel ​ D.
State or Subsidiary Name ​ Other Jurisdiction of Incorporation or Organization IM PRO MAKEUP NY L.P. ​ New York SPOILEDCHILD INC. ​ Delaware ODDITY LABS LLC ​ Delaware ODDITY TECH US INC. ​ New York Il MAKIAGE BEAUTY IL LTD ​ Israel IL MAKIAGE GB LTD ​ United Kingdom VOYAGE81 LTD ​ Israel ODDITY Global LTD ​ United Kingdom METHODIQ INC ​ Delaware ODDITY Finance LLC ​ Delaware ​ D.
The FTC requires that companies have a reasonable basis to support marketing claims. What constitutes a reasonable basis can vary depending on the strength or type of claim made, or the market in which the claim is made, but objective evidence substantiating the claim is generally required. The FTC also has specialized requirements for certain types of claims.
What constitutes a reasonable basis can vary depending on the strength or type of claim made, or the market in which the claim is made, but objective evidence substantiating the claim is generally required. The FTC also has specialized requirements for certain types of claims.
ODDITY LABS is deploying these capabilities to build a next-generation platform, which we believe will have distinct advantages: ● the ability to discover and develop high-performance products that meet consumer needs at speed and scale; ● the biological pathway mapping data base to understand the mechanisms that drive cellular behavior, supporting future innovation of novel products and solutions; ● the ability to attract world leading talent; and ● the ability to support systematic and repeatable innovation through AI-based molecule discovery.
ODDITY LABS is deploying these capabilities to build a next-generation platform, which we believe will have distinct advantages: ● the ability to discover and develop high-performance products that meet consumer needs at speed and scale; ● the biological pathway mapping data base to understand the mechanisms that drive cellular behavior, supporting future innovation of novel products and solutions; ● the ability to attract world leading talent; and ● the ability to support systematic and repeatable innovation through AI-based molecule discovery. 63 Table of Contents Seasonality For a discussion of the seasonality of our business, see the section titled “Item 5.A.
The FDA has broad authority to enforce the provisions of federal law applicable to dietary supplements, including powers to issue public Warning Letters or Untitled Letters to a company, publicize information about illegal products, detain products intended for import, request a recall of illegal or unsafe products from the market, and request that the Department of Justice initiate a seizure action, an injunction action or a criminal prosecution in the U.S. courts. 66 Table of Contents Foreign Government Regulation European Union Regulation of Cosmetic Products We currently market products that are regulated as cosmetic products in the EU.
The FDA has broad authority to enforce the provisions of federal law applicable to dietary supplements, including powers to issue public Warning Letters or Untitled Letters to a company, publicize information about illegal products, detain products intended for import, request a recall of illegal or unsafe products from the market, and request that the Department of Justice initiate a seizure action, an injunction action or a criminal prosecution in the U.S. courts.
New Ventures We established our New Ventures brand incubator in 2019 to support the in-house development of new brands. The New Ventures team operates with the mandate to build brands and their technology products from start to finish, while targeting the most attractive pockets of demand in the global beauty and wellness market.
The New Ventures team operates with the mandate to build brands and their technology products from start to finish, while targeting the most attractive pockets of demand in the global beauty and wellness market.
GDPR impose robust obligations on controllers and processors for the collection, control, use, sharing, disclosure, and other processing of data relating to an identified or identifiable living individual (personal data) and contain documentation and accountability requirements for data protection compliance. 68 Table of Contents See the section titled “Item 3.D.
For example, the GDPR and the UK GDPR impose robust obligations on controllers and processors for the collection, control, use, sharing, disclosure, and other processing of data relating to an identified or identifiable living individual (personal data) and contain documentation and accountability requirements for data protection compliance.
ITEM 4. INFORMATION ON THE COMPANY A. History and Development of the Company ODDITY’s online, direct-to-consumer business was founded in 2018 with our launch of IL MAKIAGE in the United States, with a mission to transform the global beauty and wellness market through technology and entrepreneurial thinking.
ITEM 4. INFORMATION ON THE COMPANY A. History and Development of the Company ODDITY’s online, direct-to-consumer business was established with a mission to transform the global beauty and wellness market through technology and entrepreneurial thinking.
Key Information—Risk Factors—Risks Related to Data Privacy and Security, Information Technology, and Intellectual Property” for more information. Intellectual Property To establish, maintain, protect, defend, and enforce our intellectual property rights, we rely on a combination of trademark, patent, copyright and trade secret laws in the United States and certain other jurisdictions, as well as contractual arrangements.
Intellectual Property To establish, maintain, protect, defend, and enforce our intellectual property rights, we rely on a combination of trademark, patent, copyright and trade secret laws in the United States and certain other jurisdictions, as well as contractual arrangements.
These include marketing and customer acquisition, product matching and recommendation, customer experience, and operations. We additionally use AI to support molecule discovery and product development at ODDITY LABS. ● Computer Vision. Our computer vision tools support customers in their online experience.
We deploy AI and machine learning models across a wide range of front- and back-end operations. These include marketing and customer acquisition, product matching and recommendation, customer experience, and operations. Additionally, we use AI to support molecule discovery and product development at ODDITY LABS. Our computer vision tools support customers in their online experience.
The CPRA significantly expands the CCPA, including by introducing additional obligations on covered companies, such as data minimization and storage limitations, granting additional rights to consumers, such as correction of personal information and additional opt-out rights, and creates a new entity, the California Privacy Protection Agency, to implement and enforce the law.
Further, the CPRA significantly expands the CCPA, including by introducing additional obligations on covered companies, such as data minimization and storage limitations, and granting additional rights to consumers, such as correction of personal information and additional opt-out rights.
While we have not in the past been affected by significant volatility in the prices of principal raw materials required to make our products, it is possible that price volatility could increase in the future.
While we have not in the past been affected by significant volatility in the prices of principal raw materials required to make our products, it is possible that price volatility could increase in the future. We believe that we are well-positioned to withstand any reasonably foreseeable supply chain disruptions or pricing fluctuations.
We have rapidly and profitably scaled since then and believe that today we are the world’s largest online, direct-to-consumer company in the beauty and wellness industry based on revenue. In 2017 we secured an investment from L Catterton to support the launch of our technology platform and online business in the United States.
We have rapidly and profitably scaled since our launch of IL MAKIAGE in 2018 in the United States, and believe that today we are the world’s largest online, direct-to-consumer company in the beauty and wellness industry based on revenue.
As our name suggests, our corporate DNA values the ability to be unconstrained by historical conventions. We are uncompromising in our mission to make the first move, set the pace for the industry, take big swings, and continuously raise the bar - a wild vision combined with hard work and a hands-on approach. ● Technology First.
We are uncompromising in our mission to make the first move, set the pace for the industry, take big swings, and continuously raise the bar - a wild vision combined with hard work and a hands-on approach. 61 Table of Contents ● Technology First.
FDA regulations also prohibit or otherwise restrict the use of certain types of ingredients in cosmetic products. In addition, the FDA requires that cosmetic labeling and claims be truthful and not misleading.
The FDA may, by regulation, require other warning statements on certain cosmetic products for specified hazards associated with such products. FDA regulations also prohibit or otherwise restrict the use of certain types of ingredients in cosmetic products. In addition, the FDA requires that cosmetic labeling and claims be truthful and not misleading.
In addition to developing products with ingredients available to the broader industry, we are investing in proprietary ingredients with ODDITY LABS, our in-house biotechnology that deploys cutting edge technology, including AI-based molecule discovery, to identify and launch novel ingredients that deliver superior performance and outcomes for consumers. 60 Table of Contents Disrupting a Massive Market with Technology ODDITY is powered by our vision and commitment to revolutionize the beauty and wellness industry through technological innovations and outside thinking.
In addition to developing products with ingredients available to the broader industry, we are investing in proprietary ingredients with ODDITY LABS, our in-house biotechnology that deploys cutting edge technology, including AI-based molecule discovery, to identify and launch novel ingredients that aim to deliver superior performance and outcomes for consumers.
Our People and Culture Our people are key to our success. We are a diverse team of beauty industry outsiders by design, committed to using transformative innovation to deliver radically new solutions to our customers.
We maintain direct relationships with carriers in instances where we believe it will enable us to achieve lower costs. Our People and Culture Our people are key to our success. We are a diverse team of beauty industry outsiders by design, committed to using transformative innovation to deliver radically new solutions to our customers.
We have made significant R&D investments in support of developing exceptional quality beauty and wellness products that drive adoption, customer loyalty, and repeat purchasing behavior. Our in-house R&D center works directly with our third-party manufacturing partners to develop or identify the precise product formulas that best achieve our stringent data-centric performance and quality criteria.
Our in-house R&D center works directly with our third-party manufacturing partners to develop or identify the precise product formulas that best achieve our stringent data-centric performance and quality criteria.
These laws and regulations principally relate to the ingredients, proper labeling, advertising, packaging, marketing, manufacture, safety, shipment and disposal of our products.
These laws and regulations principally relate to the ingredients, proper labeling, advertising, packaging, marketing, manufacture, safety, shipment and disposal of our products. None of our products to date have required FDA approval and as a result the FDA has not approved any of our products.
In the event the FDA identifies unsanitary conditions, false or misleading labeling, or any other violation of FDA regulation, the FDA may request, or a manufacturer may independently decide to conduct a recall or market withdrawal of a product or to make changes to its manufacturing processes or product formulations or labels. 65 Table of Contents The FTC also regulates and can bring enforcement action against cosmetic companies for deceptive advertising and lack of adequate scientific substantiation for claims.
In the event the FDA identifies unsanitary conditions, false or misleading labeling, or any other violation of FDA regulation, the FDA may request, or a manufacturer may independently decide to conduct a recall or market withdrawal of a product or to make changes to its manufacturing processes or product formulations or labels.
In 2023, we acquired Revela, a Boston-based biotechnology company pioneering pharma-grade technology to discover molecules and formulations for beauty and wellness products. With this acquisition, we established ODDITY LABS and accelerated our investment in biotech, including AI-based molecule discovery. Capital Expenditures See the section titled “Item 5.B.
In 2023, we acquired Revela, a Boston-based biotechnology company pioneering pharma-grade technology to discover molecules and formulations for beauty and wellness products. With this acquisition, we established ODDITY LABS and accelerated our investment in biotech, including AI-based molecule discovery. In 2025, we launched our third brand, METHODIQ, as a medical telehealth platform to deliver high-efficacy treatments at scale.
From inception, we construct each brand by thoughtfully leveraging data and employing an exhaustive testing process with our global user base to determine product-market fit and develop ingredients and formulations. We are committed to only launching a product when our user data shows there is a real consumer need and that our product quality gives us the ability to win.
From inception, we construct each brand by thoughtfully leveraging data and employing an exhaustive testing process with our global user base to determine product-market fit and develop ingredients and formulations.
We are focused on continuing to acquire new users efficiently, and building brand awareness and a demand generation engine. We have invested heavily in building a talented in-house marketing team, while also developing proprietary technologies that enable us to build data-driven and highly personalized campaigns that can scale globally on digital platforms.
We have invested heavily in building a talented in-house marketing team, while also developing proprietary technologies that enable us to build data-driven and highly personalized campaigns that can scale globally on digital platforms. Our proprietary technologies and robust first-party database enable us to achieve cost-effective and data-driven digital marketing and user acquisition.
For example, the CCPA, which became effective in January 2020, gives California residents expanded rights to access and delete their personal information, opt out of certain personal information sharing, and receive detailed information about how their personal information is used by requiring covered companies to provide new disclosures to California consumers (as that term is broadly defined and may include any of our current or future employees who may be California residents) and provide such residents new ways to opt out of certain sales of personal information.
For example, the CCPA, gives California residents expanded rights to access and delete their personal information, opt out of certain personal information sharing, and receive detailed information about how their personal information is used by requiring covered companies to provide new disclosures to California consumers.
We utilize multiple outbound carriers for customer order fulfillment and distribution across the various markets where we operate. Our shipping carrier network is optimized to achieve targeted delivery times while minimizing costs. We maintain direct relationships with carriers in instances where we believe it will enable us to achieve lower costs.
Additionally, we continually look for opportunities to improve the customer experience and lower costs through the implementation of new processes and technology. We utilize multiple outbound carriers for customer order fulfillment and distribution across the various markets where we operate. Our shipping carrier network is optimized to achieve targeted delivery times while minimizing costs.
We may consider pursuing trademark registrations for additional marks and in additional jurisdictions if and to the extent we believe such registrations would be beneficial to our business and cost-effective. As of December 31, 2024, we have also registered various domain names that we use in the conduct of our business, including ilmakiage.co.il, ilmakiage.com and spoiledchild.com.
We may consider pursuing trademark registrations for additional marks and in additional jurisdictions if and to the extent we believe such registrations would be beneficial to our business and cost-effective.
Our proprietary technologies and robust first-party database enable us to achieve cost-effective and data-driven digital marketing and user acquisition. We also design innovative marketing programs that help increase brand awareness. Supply Chain ODDITY has built a scalable, efficient, and resilient supply chain to support our operations globally.
We also design innovative marketing programs that help increase brand awareness and rely heavily on digital marketing platforms to conduct advertising campaigns. Supply Chain ODDITY has built a scalable, efficient, and resilient supply chain to support our operations globally.
The FDA has also been granted new enforcement authorities over cosmetics, such as mandatory recall authority, and new cosmetic labeling requirements have been imposed. The FDA monitors compliance of cosmetic products through market surveillance and inspection of cosmetic manufacturers and distributors to ensure that the products are not manufactured under unsanitary conditions, or labeled in a false or misleading manner.
The FDA monitors compliance of cosmetic products through market surveillance and inspection of cosmetic manufacturers and distributors to ensure that the products are not manufactured under unsanitary conditions, or labeled in a false or misleading manner. Inspections also may arise from consumer or competitor complaints filed with the FDA.
If a company has not adequately substantiated the safety of its products or ingredients by, for example, performing appropriate toxicological tests or relying on already available toxicological test data, then a specific warning label is required. The FDA may, by regulation, require other warning statements on certain cosmetic products for specified hazards associated with such products.
For example, the use of dihydroxyacetone as a color additive in self-tanning products must comply with FDA regulations that impose strict limitations on impurities. 65 Table of Contents If a company has not adequately substantiated the safety of its products or ingredients by, for example, performing appropriate toxicological tests or relying on already available toxicological test data, then a specific warning label is required.
Seasonality For a discussion of the seasonality of our business, see the section titled “Item 5.A. Operating and Financial Review and Prospects—Operating Results—Key Factors Affecting Our Performance—Seasonality”. Sales and Marketing Our sales and marketing capabilities represent a core and differentiated competency that is essential to the success of the ODDITY platform.
Operating and Financial Review and Prospects—Operating Results—Key Factors Affecting Our Performance—Seasonality”. Sales, Advertising and Marketing Our sales, advertising and marketing capabilities represent a core and differentiated competency that is essential to the success of the ODDITY platform. We are focused on continuing to acquire new users efficiently, and building brand awareness and a demand generation engine.
Since the brand’s launch in 2018, according to our customer surveys, IL MAKIAGE has converted millions of consumers from shopping for beauty products in stores to making purchases online and disrupted the industry in the process. SpoiledChild We launched our multi-category second brand, SpoiledChild, in February 2022 with the goal of disrupting the wellness industry.
Since the brand’s launch in 2018, based on our customer surveys, we believe that IL MAKIAGE has converted millions of consumers from shopping for beauty products in stores to making purchases online and disrupted the industry in the process. SpoiledChild SpoiledChild is a prestige online-only wellness brand powered by ODDITY’s scalable technology platform, including its AI and machine learning capabilities.
In 2020 we expanded our online platform to the U.K., followed by additional markets in continental Europe and Australia. Sales outside of the United States represented 15% of our net revenue for the year ended December 31, 2024. In 2021, we acquired Voyage81, a leader in computer vision, AI-driven imaging, and hyperspectral technology.
Sales outside of the United States represented approximately 18% of our net revenue for the year ended December 31, 2025. In 2021, we acquired Voyage81, a leader in computer vision, AI-driven imaging, and hyperspectral technology. In 2022, we launched our second brand, SpoiledChild, as a multicategory wellness brand.
We launched IL MAKIAGE in the United States in 2018 as an online beauty brand and SpoiledChild in 2022 as an online wellness brand, and plan to launch additional brands off of our platform in the future, with Brand 3 and 4 already in development.
Our Powerhouse Brands We build and scale digitally native prestige beauty and wellness brands with strong brand equities off of the ODDITY platform. We launched IL MAKIAGE in the United States in 2018 as an online beauty brand, SpoiledChild in 2022 as an online wellness brand, and METHODIQ in 2025 as a medical telehealth platform.
We believe that we are well-positioned to withstand any reasonably foreseeable supply chain disruptions or pricing fluctuations. 63 Table of Contents Distribution and Fulfillment We primarily utilize third parties to warehouse and distribute our products throughout the world. We believe that we have sufficient capacity to support current and reasonably anticipated future requirements.
Distribution and Fulfillment We primarily utilize third parties to warehouse and distribute our products throughout the world. We believe that we have sufficient capacity to support current and reasonably anticipated future requirements. We are continually assessing our fulfillment and distribution network to align our capacity with anticipated regional sales demand and planned expansion into new markets.
In the EU, the sale of cosmetic products is regulated under the EU Cosmetics Regulation, setting out the general regulatory framework for finished cosmetic products and their ingredients. The EU Cosmetics Regulation is directly applicable in, and binding on all EU member states and is enforced at the national member state level.
Foreign Government Regulation European Union Regulation of Cosmetic Products We currently market products that are regulated as cosmetic products in the EU. In the EU, the sale of cosmetic products is regulated under the EU Cosmetics Regulation, setting out the general regulatory framework for finished cosmetic products and their ingredients.
The FDA also recommends that manufacturers maintain product complaint and recall files and voluntarily report adverse events to the agency. Further, under the Modernization of Cosmetic Regulation Act of 2022, which amended the FDCA, manufacturers of cosmetics are subject to more onerous FDA obligations, including adverse event reporting and record retention requirements, safety substantiation requirements, and facility registration requirements.
Following the implementation of MoCRA in 2022, which amended the FDCA, the FDA has the authority to subject cosmetics manufacturers to more onerous obligations, including adverse event reporting and record retention requirements, safety substantiation requirements, facility registration requirements, and ingredient labeling requirements.
Over the years, the EU cosmetics legal regime has been adopted by many countries around the world.
The EU Cosmetics Regulation is directly applicable in, and binding on all EU member states and is enforced at the national member state level. Over the years, the EU cosmetics legal regime has been adopted by many countries around the world.
We believe AI-based molecule discovery is a transformative frontier in product development for our industry, driven by the advancements of key enabling technologies including synthetic biology, genomic sequencing, robotics, and AI. The technological approach is already widely used in the field of biotechnology for drug discovery.
ODDITY LABS was formed in April 2023 in conjunction with our acquisition of Revela, a biotechnology company focused on the development of new molecules for beauty and wellness products. We believe AI-based molecule discovery is a transformative frontier in product development for our industry, driven by the advancements of key enabling technologies including translational biology, organic chemistry, robotics, and AI.
SpoiledChild, our second brand, which we launched in 2022, is a multicategory wellness brand, including hair and skin products. Our in-house New Ventures brand incubator has a mandate to pursue additional brands and product categories ripe for disruption, including Brand 3, a telehealth platform, and Brand 4, which are both currently in development.
Our in-house New Ventures brand incubator has a mandate to pursue additional brands and product categories ripe for disruption, including Brand 4, which is currently in development. We believe we can drive significant growth and gain market leadership by developing additional standalone, digitally native brands for future launches.
Technology Talent We operate an elite technology organization and technology is at the center of everything we do. An ethos of innovation, creation, agility, and disruption permeates our entire company. Our dedicated workforce includes in-house engineers, data scientists, computer vision experts, and product teams that comprise over 40% of our online platform headcount.
Our dedicated workforce includes in-house engineers, data scientists, computer vision experts, and product teams that comprise over 40% of our online platform headcount. Our investments in and focus on recruiting top technology talent is a key component of our strategy, and we expect our technology roadmap will define the future of beauty.
In just 18 months following our U.S. launch in 2018, and simultaneous with our rapid revenue growth, we achieved profitability due to strong repeat rates. During the year ended December 31, 2024, we scaled to $647 million of net revenue, compared to $509 million and $325 million for the years ended December 31, 2023 and 2022, respectively.
Our business has a powerful and rare combination of scale, growth, and profitability. During the year ended December 31, 2025, we scaled to $810 million of net revenue, compared to $647 million and $509 million for the years ended December 31, 2024 and 2023, respectively.
Our Platform We operate a different model to that of the incumbents that have historically dominated the global beauty and wellness market. This distinctive approach is core to our competitive advantage and ability to disrupt the market and gain market share. ● Outsiders by Design. Disrupting a market requires outside thinking.
Our distinctive approach relative to incumbents is core to our competitive advantage and ability to disrupt the market and gain market share. ● Outsiders by Design. Disrupting a market requires outside thinking. Our organization is built by beauty industry outsiders, who come with fresh thinking, a focus on innovation, and a desire to drive continuous improvement.
However, to date, there are no significant differences between the frameworks of the U.K. Cosmetics Regulation and the EU Cosmetics Regulation. Data Privacy and Security We collect, store, use, share, and otherwise process data, some of which contains personal information.
Cosmetic products placed on the market in Northern Ireland are still covered by the EU Cosmetics Regulation. 68 Table of Contents Data Privacy and Security We collect, store, use, share, and otherwise process data, some of which contains personal information.
Our organization is built entirely by beauty industry outsiders, who come with fresh thinking, a focus on innovation, and a desire to drive continuous improvement. Our founder-led management team saw an industry ripe for disruption after observing the disconnect between online beauty discovery and offline purchasing behavior.
Our founder-led management team saw an industry ripe for disruption after observing the disconnect between online beauty discovery and offline purchasing behavior. As our name suggests, our corporate DNA values the ability to be unconstrained by historical conventions.
Our product portfolio spans categories including face and complexion, eye, brow and lip products, makeup tools, skincare, haircare, and supplements. These products are designed specifically for our direct-to-consumer and online customer base. Products are priced in a range of $20-$100 per item, with higher price points for the more elite performance products in our range.
We plan to launch additional brands off of our platform in the future, including Brand 4. Our product portfolio spans categories including face and complexion, skincare, haircare, bodycare, medical grade prescription and OTC products, supplements, color cosmetics, and makeup tools. These products are designed specifically for our direct-to-consumer and online customer base.
Empowering a new generation of consumers to redefine the rules of aging, SpoiledChild allows consumers to control their future by offering an individualized approach to age-control. In addition, SpoiledChild seeks to promote sustainability with its patented refillable packaging, designed to reduce waste.
SpoiledChild offers a range of superior products and sustainable design including skincare products, haircare products, and supplements. 62 Table of Contents Empowering a new generation of consumers to redefine the rules of aging, SpoiledChild allows consumers to control their future by offering an individualized approach to age-control.
Our primary trademark, IL MAKIAGE, and our logo have been registered in the United States as well as in a number of foreign jurisdictions, including Israel. We also own several trademarks for which applications for registration are pending including, among others, SpoiledChild. As of December 31, 2024, we owned approximately 236 trademark registrations and 52 applications for trademark registration worldwide.
Our primary trademark, IL MAKIAGE, the IL MAKIAGE logo and SpoiledChild have been registered in the United States as well as in numerous foreign jurisdictions, including the EU, the U.K. and Israel.
This data is also critical to training our collection of machine learning models which drive the user journey, across acquisition, purchase, and post purchase. We believe our data-centric model offers significant financial benefits, similar to other “land and expand” models in the tech industry which support faster growth at higher incremental returns than analog models.
This data is also critical to training our collection of machine learning models which drive the user journey, across acquisition, purchase, and post purchase. ● Superior Product Performance. Our data-centric strategy enables us to create and deliver superior products for our customers.
These tools allow us to identify skin conditions like acne and hyperpigmentation, track those conditions over time, and anticipate how those conditions will progress. We acquired hyperspectral vision technology in 2021 through the purchase of Voyage81. For more information see Note 13 to our consolidated financial statements included elsewhere in this Annual Report. ● PowerMatch / SpoiledBrain.
These tools allow us to identify skin conditions like acne and hyperpigmentation, track those conditions over time, and anticipate how those conditions will progress. ● Data Drives Our Business. We deploy our technology to better understand customers and anticipate their wants and needs.
In addition, for the years ended December 31, 2024, 2023 and 2022, we achieved a net income margin of 15.7%, 11.5%, and 6.7%, and Adjusted EBITDA margin of 23.3%, 21.1%, and 12.2%, respectively. For a breakdown of our net revenue by geography, see Note 15 to our consolidated financial statements included elsewhere in this Annual Report.
For a breakdown of our net revenue by geography, see Note 14 to our consolidated financial statements included elsewhere in this Annual Report. Our Platform We are powered by our vision and commitment to revolutionize the beauty and wellness industry through technological innovations and outside thinking.
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We believe we can drive significant growth and gain market leadership by developing additional standalone, digitally native brands for future launches. Our business has a powerful and rare combination of scale, growth, and profitability. Since our launch, we have proven our ability to quickly achieve success in new brands, products, categories and international markets.
Added
In 2017 we secured an investment from L Catterton to support the launch of our technology platform and online business in the United States. In 2020 we expanded our online platform to the U.K., followed by additional markets in continental Europe and Australia.
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Our asset light model supports significant cash generation. During the year ended December 31, 2024, we generated $137.8 million of net operating cash flow compared to $87.5 million and $39.0 million for the years ended December 31, 2023, and 2022. See the section titled “Item 5.A. Operating and Financial Review and Prospects—Operating Results” for more information.
Added
SpoiledChild, our second brand, which we launched in 2022, is a multicategory wellness brand. We launched our third brand, METHODIQ, in 2025 as a medical telehealth platform to deliver high-efficacy treatments at scale, starting in dermatology.
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We intend to sustain our high-growth and attractive margin profile that consistently delivers great outcomes for our stakeholders. To do this, we maintain a long-term growth strategy that guides our continued investments that support profitable growth and market share gains within a large and attractive global beauty and wellness market.
Added
Products are priced in a range of $20-$100 per item, with higher price points for the more elite performance products in our range. We have made significant R&D investments in support of developing exceptional quality beauty and wellness products that drive adoption, customer loyalty, and repeat purchasing behavior.
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These include growing our user base, converting users into customers, increasing customer loyalty and share of wallet, expanding our global footprint, growing our existing brands, and expanding our portfolio of brands and services. 59 Table of Contents Our Market Opportunity We operate in the highly attractive over $600 billion global beauty and wellness market as defined by the global beauty, personal care and dietary supplements market per Euromonitor, which is characterized by its large size, secular tailwinds, high growth, and compelling gross margin profile.
Added
In addition, SpoiledChild seeks to promote sustainability with its patented refillable packaging, designed to reduce waste. METHODIQ METHODIQ is a medical grade telehealth platform that delivers high-efficacy treatments at scale, starting in dermatology.
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We believe this market is ripe for disruption, dominated by established, largely offline, wholesale models that we feel have not sufficiently evolved to meet changing consumer preferences for a digital, personalized, and customized experience. We see two powerful pillars of transformation in the industry, and have positioned ODDITY to lead on both fronts: ● Increased online adoption.
Added
We aim to help users cure their medical issues with fully customized treatments and the highest standards of care, based on precise online diagnosis and without needing to go to the doctor’s office or running the risk of getting lost in a drug store.
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We expect online will emerge as the largest and most important channel in the industry, growing to account for roughly 50% of sales. ODDITY is already leading on this front as the largest online direct-to-consumer platform in the industry by revenue due to its significant investments in data and technology tools. ● Accelerated demand for high performance products .
Added
The user experience begins with an individualized assessment powered by a suite of computer vision and AI tools that observe visible skin features like acne and dark spots. Users receive continuous care through METHODIQ’s tracking app, which quantifies progress and delivers feedback to promote compliance and success.
Removed
Consumers are migrating away from generic brands and products and towards highly effective products with active ingredients and formulations that truly solve their pain points. ODDITY LABS and our investment in AI-based molecule discovery looks to extend this lead in product performance by creating and launching the next generation of beauty and wellness products to solve consumers’ toughest pain points.
Added
METHODIQ addresses skin conditions with a breakthrough and proprietary product line that aims to maximize efficacy, minimize side effects, and deliver a best in class beauty product experience, including scent, texture, and feel. New Ventures We established our New Ventures brand incubator in 2019 to support the in-house development of new brands.
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Our investments in and focus on recruiting top technology talent is a key component of our strategy, and we expect our technology roadmap will define the future of beauty. ● Data Drives Our Business. We deploy our technology to better understand customers and anticipate their wants and needs.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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The increase in cost of revenue was primarily attributable to increased orders partially offset by supply chain efficiencies and cost improvement efforts.
The increase in cost of revenue was primarily attributable to increased orders partially offset by supply chain efficiencies and cost improvement efforts.
Further, we believe this measure is helpful in highlighting trends in our operating results, because it excludes the impact of items that are outside the control of management or not reflective of our ongoing operations and performance.
Further, we believe this measure is helpful in highlighting trends in our operating results, because it excludes the impact of items that are outside the control of management or not reflective of our ongoing operations and performance.
Investing Activities Net cash provided by investing activities for the year ended December 31, 2024 was $1.4 million, compared to $140.0 million used in investing activities for the year ended December 31, 2023.
Net cash provided by investing activities for the year ended December 31, 2024 was $1.4 million, compared to $140.0 million used in investing activities for the year ended December 31, 2023.
Financing Activities Net cash used in financing activities was $127.3 million for the year ended December 31, 2024, compared to $48.8 million used in financing activities for the year ended December 31, 2023.
Net cash used in financing activities was $127.3 million for the year ended December 31, 2024, compared to $48.8 million used in financing activities for the year ended December 31, 2023.
Through this virtuous cycle we have successfully gained share of our industry while increasing our share of customer wallet. We continue to drive repeat behavior through strong customer satisfaction, improvements in data-driven personalization, product recommendations, customer service and engagement, in addition to new products and brand launches.
Through this virtuous cycle we have successfully gained share of our industry while increasing our share of customer wallet. We continue to aim to drive repeat behavior through strong customer satisfaction, improvements in data-driven personalization, product recommendations, customer service and engagement, in addition to new products and brand launches.
The amount of the deferred tax asset considered realizable, however, could be reduced in the near term if estimates of future taxable income during the carryforward period are reduced. Significant judgment is required in determining our uncertain tax positions.
The amount of the deferred tax asset considered realizable, however, could be reduced in the near term if estimates of future taxable income during the carryforward period are reduced. Judgment is required in determining our uncertain tax positions.
If actual market conditions are less favorable than those we project, further adjustments may be required that would increase the cost of goods sold in the period in which such a determination was made. 82 Table of Contents Income Taxes Income taxes are accounted for under the asset and liability method.
If actual market conditions are less favorable than those we project, further adjustments may be required that would increase the cost of goods sold in the period in which such a determination was made. 83 Table of Contents Income Taxes Income taxes are accounted for under the asset and liability method.
Although we believe that the estimates we use are reasonable, due to the inherent uncertainty involved in making those estimates, actual results reported in future periods could differ from those estimates. 81 Table of Contents Revenue Recognition Our primary source of revenue is from the sales of our products through our online direct-to-consumer model.
Although we believe that the estimates we use are reasonable, due to the inherent uncertainty involved in making those estimates, actual results reported in future periods could differ from those estimates. 82 Table of Contents Revenue Recognition Our primary source of revenue is from the sales of our products through our online direct-to-consumer model.
Our net cash provided by operating activities for the year ended December 31, 2024 and 2023 consisted of $101.5 million and $58.5 million of net income, adjusted for $33.6 million and $32.2 million of non-cash expenses and $2.7 million and $(3.2) million of net cash provided (used in) as a result of changes in operating assets and liabilities, respectively.
Our net cash provided by operating activities for the years ended December 31, 2024 and 2023 consisted of $101.5 million and $58.5 million of net income, adjusted for $33.6 million and $32.2 million of non-cash expenses and $2.7 million and $(3.2) million of net cash provided (used in) as a result of changes in operating assets and liabilities, respectively.
The $1.4 million of net cash provided by investing activities in the year ended December 31, 2024 was primarily related to a $(30.0) million net change in short-term deposits, a $(18.5) million investment in marketable securities and $(3.3) million related to capital expenditures.
The $1.4 million of net cash provided by investing activities in the year ended December 31, 2024 was primarily related to a $30.0 million net change in short-term deposits, partially offset by a $18.5 million investment in marketable securities and $3.3 million related to capital expenditures.
Net revenue is primarily driven by the number of orders. 71 Table of Contents Cost of Revenue Cost of revenue consists principally of the costs to procure our products, including the amounts invoiced by our third-party contract manufacturers and suppliers for inventory, as well as inbound and outbound shipping costs, duties and other related costs, and inventory write-offs.
Net revenue is primarily driven by the number of orders. Cost of Revenue Cost of revenue consists principally of the costs to procure our products, including the amounts invoiced by our third-party contract manufacturers and suppliers for inventory, as well as inbound and outbound shipping costs, duties and other related costs, and inventory write-offs.
Stock-based compensation expense was $25.0 million for the year ended December 31, 2024, compared to stock-based compensation expense of $24.1 million for the year ended December 31, 2023. 73 Table of Contents Financial Income, Net ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2024 ​ 2023 ​ $ Change ​ % Change ​ ​ (in thousands) Financial Income, net $ (12,306) $ (4,283) $ (8,023) 187.3 % ​ Financial income, net increased by $8.0 million for the year ended December 31, 2024 compared to the year ended December 31, 2023.
Stock-based compensation expense was $25.0 million for the year ended December 31, 2024, compared to stock-based compensation expense of $24.1 million for the year ended December 31, 2023. 75 Table of Contents Financial Income, Net ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2024 ​ 2023 ​ $ Change ​ % Change ​ ​ (in thousands) Financial income, net ​ ​ ​ $ (12,306) ​ ​ ​ $ (4,283) ​ ​ ​ $ (8,023) ​ ​ ​ 187.3 % ​ Financial income, net increased by $8.0 million, or 187.3%, for the year ended December 31, 2024 compared to the year ended December 31, 2023.
The 2024 Credit Facilities were not utilized by the Company and were replaced in full by the 2025 Credit Facilities in January 2025. 78 Table of Contents 2020 Credit Facility In April 2020, we entered into a loan agreement with Bank Hapoalim, denominated in NIS, pursuant to which we borrowed an aggregate principal amount of NIS 5 million (approximately $1.4 million according to the applicable exchange rate as of December 31, 2023) (the “2020 Credit Facility”).
The 2025 Credit Facilities were governed by Israeli law. 79 Table of Contents The 2024 Credit Facilities were not utilized and were replaced in full by the 2025 Credit Facilities in January 2025. 2020 Credit Facility In April 2020, we entered into a loan agreement with Bank Hapoalim, denominated in NIS, pursuant to which we borrowed an aggregate principal amount of NIS 5 million (approximately $1.4 million according to the applicable exchange rate as of December 31, 2023) (the “2020 Credit Facility”).
Attractive Unit Economics Supported by Efficient Customer Acquisition and Repeat Purchases Through our technology platform we are able to efficiently bring visitors to our website, turn visitors into users by learning about them through engagement, leverage the data we have across the platform to convert those users into paying customers, and then convert customers into repeat customers.
Attractive Unit Economics Dependent on Efficient Customer Acquisition and Repeat Purchases Through our technology platform we aim to efficiently bring visitors to our website, turn visitors into users by learning about them through engagement, leverage the data we have across the platform to convert those users into paying customers, and then convert customers into repeat customers.
An additional commitment fee of 0.32% applied to any unused credit. The obligations of the Company under the 2024 Credit Facilities included a negative pledge by the Company and were guaranteed by certain of the Company’s subsidiaries.
An annual commitment fee of 0.32% applied to any unused portion of the 2024 Credit Facilities. The obligations of the Company under the 2024 Credit Facilities were subject to a negative pledge by the Company and were guaranteed by certain of the Company’s subsidiaries.
Risk Factors—Risks Related to Our Business and Industry—We may need additional capital, and we cannot be sure that additional financing will be available on favorable terms, if at all.” Cash Flows The following table summarizes our cash flows for the periods presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31 ​ ​ 2024 ​ 2023 ​ 2022 ​ ​ (in thousands) Cash provided by operating activities $ 137,764 $ 87,455 $ 39,032 Cash provided by (used in) investing activities ​ 1,352 ​ (139,991) ​ (25,780) Cash (used in) provided by financing activities ​ (127,299) ​ 48,811 ​ (246) Effect of exchange rate fluctuations on cash and cash equivalents ​ (236) ​ (623) ​ (781) Net increase (decrease) in cash, cash equivalents and restricted cash ​ $ 11,581 ​ $ (4,348) ​ $ 12,225 ​ Operating Activities Our largest source of operating cash is cash collected from sales of our products to our customers.
Risk Factors—Risks Related to Our Business and Industry—We may need additional capital, and we cannot be sure that additional financing will be available on favorable terms, if at all.” Cash Flows The following table summarizes our cash flows for the periods presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31 ​ ​ 2025 ​ 2024 ​ 2023 ​ ​ (in thousands) Cash provided by operating activities ​ ​ ​ $ 87,581 ​ ​ ​ $ 137,764 ​ ​ ​ $ 87,455 Cash (used in) provided by investing activities ​ (267,248) ​ 1,352 ​ (139,991) Cash provided by (used in) financing activities ​ 531,348 ​ (127,299) ​ 48,811 Effect of exchange rate fluctuations on cash and cash equivalents ​ 251 ​ (236) ​ (623) Net increase (decrease) in cash, cash equivalents and restricted cash ​ $ 351,932 ​ $ 11,581 ​ $ (4,348) ​ 80 Table of Contents Operating Activities Our largest source of operating cash is cash collected from sales of our products to our customers.
See the section titled “Item 6.C. Directors, Senior Management and Employees—Board Practices—Employment and Consulting Agreements with Executive Officers.” These obligations are partially funded through accounts maintained with financial institutions and recognized as an asset on our balance sheet. Of this amount, $0.5 million is unfunded.
Directors, Senior Management and Employees—Board Practices—Employment and Consulting Agreements with Executive Officers.” These obligations are partially funded through accounts maintained with financial institutions and recognized as an asset on our balance sheet. Of this amount, $0.75 million is unfunded.
Other companies, including companies in our industry, may calculate Adjusted EBITDA and Adjusted EBITDA margin differently or not at all, which reduces their usefulness as comparative measures. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2024 ​ 2023 ​ 2022 ​ ​ (in thousands) Net Income $ 101,491 $ 58,534 $ 21,728 ​ Financial income, net ​ (12,306) ​ (4,283) ​ (1,247) ​ Taxes on income ​ 26,415 ​ 20,067 ​ 7,184 ​ Depreciation and amortization ​ 9,827 ​ 8,605 ​ 4,408 ​ Share-based compensation ​ 25,022 ​ 24,111 ​ 6,697 ​ Non-recurring adjustments ​ — ​ 300 ​ 701 ​ Adjusted EBITDA ​ $ 150,449 ​ $ 107,334 ​ $ 39,471 ​ Net income margin ​ 15.7 % 11.5 % 6.7 % Adjusted EBITDA margin ​ 23.3 % 21.1 % 12.2 % ​ Adjusted Operating Income Adjusted operating income is defined as operating income adjusted for the impact of share-based compensation and non-recurring adjustments.
Other companies, including companies in our industry, may calculate Adjusted EBITDA and Adjusted EBITDA margin differently or not at all, which reduces their usefulness as comparative measures. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2025 ​ 2024 ​ 2023 ​ ​ (in thousands) Net Income ​ ​ ​ $ 110,745 ​ ​ ​ $ 101,491 ​ ​ ​ $ 58,534 ​ Financial income, net ​ (16,935) ​ (12,306) ​ (4,283) ​ Taxes on income ​ 24,960 ​ 26,415 ​ 20,067 ​ Depreciation and amortization ​ 10,687 ​ 9,827 ​ 8,605 ​ Share-based compensation ​ 33,891 ​ 25,022 ​ 24,111 ​ Non-recurring adjustments ​ — ​ — ​ 300 ​ Adjusted EBITDA ​ $ 163,348 ​ $ 150,449 ​ $ 107,334 ​ Net income margin ​ 13.7 % 15.7 % 11.5 % Adjusted EBITDA margin ​ 20.2 % 23.3 % 21.1 % ​ Adjusted Operating Income Adjusted operating income is defined as operating income adjusted for the impact of share-based compensation and non-recurring adjustments.
We had net revenue outside of the United States of $100.3 million, $94.6 million and $83.4 million for the years ended December 31, 2024, 2023 and 2022, respectively, accounting for approximately 15%, 19% and 26% of our net revenue for the years then ended, respectively.
We had net revenue outside of the United States of $142.1 million, $100.3 million and $94.6 million for the years ended December 31, 2025, 2024 and 2023, respectively, accounting for approximately 18%, 15% and 19% of our net revenue for the years then ended, respectively.
This increase was primarily due to an increase of $33.6 million in advertising costs to support sales growth. Selling, general and administrative expenses for the year ended December 31, 2023, were also impacted by increased investment related to growth initiatives, including ODDITY LABS and future brands. We also incurred increased expenses related to our IPO and public company costs.
This increase was primarily due to an increase of $81 million in advertising costs to support sales growth. Selling, general and administrative expenses for the year ended December 31, 2025 were also impacted by increased investment related to growth initiatives, including ODDITY LABS and future brands.
Borrowings under the 2024 Credit Facilities accrued interest at a percentage rate per annum equal to SOFR + 2.7% for borrowings of up to $70 million; SOFR + 3.5% for fixed revolving loans provided for a period shorter than a year; and Prime + 0.1% for on-call borrowings made in NIS.
Borrowings under the 2024 Credit Facilities bore interest at a per annum rate equal to SOFR + 2.7% for borrowings of up to $70 million for a period of one year; SOFR + 3.5% for fixed revolving loans with a term of less than one year; and Prime + 0.1% for on-call borrowings denominated in NIS.
Our primary uses of cash from operating activities are for marketing expenses, personnel expenses, and general and administrative expenses. 79 Table of Contents Net cash provided by operating activities increased to $137.8 million for the year ended December 31, 2024, compared to $87.5 million for the year ended December 31, 2023, primarily due to an increase in net revenue and higher gross margins, leading to an increase in net income adjusted for certain non-cash expenses and change in working capital.
Net cash provided by operating activities increased to $137.8 million for the year ended December 31, 2024, compared to $87.5 million for the year ended December 31, 2023, primarily due to an increase in net revenue and higher gross margins, leading to an increase in net income adjusted for certain non-cash expenses and change in working capital.
Taxes on Income Taxes on income mainly consists of income taxes related to Israel and United States federal and state taxes, and changes in deferred tax assets.
Taxes on Income Taxes on income mainly consist of current income taxes related to Israel and United States federal and state taxes, as well as changes in deferred tax assets and liabilities.
Our gross margin increased 3.2% to 70.4% in the year ended December 31, 2023, compared to 67.2% in the year ended December 31, 2022. Our gross margin increase was largely driven by supply chain efficiencies and cost improvement efforts.
Our gross margin increased 0.3% to 72.7% in the year ended December 31, 2025 compared to 72.4% in the year ended December 31, 2024. Our gross margin increase was largely driven by supply chain efficiencies and cost improvement efforts.
Borrowings under the 2025 Credit Facilities will accrue interest at a percentage rate per annum equal to SOFR + 3.1% for borrowings of up to $130,000,000; SOFR + 2.6% for fixed revolving loans provided for a period shorter than a year; and Prime + 0.1% for on-call borrowings made in NIS.
Borrowings under the 2025 Credit Facilities bore interest at a per annum rate equal to SOFR + 3.1% for borrowings of up to $130 million for a period of one year; SOFR + 2.6% for fixed revolving loans with a term of less than one year; and Prime + 0.1% for on-call borrowings denominated in NIS.
Our historical results and period-to-period comparisons for any prior period are not necessarily indicative of results expected in any future period. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2024 ​ 2023 ​ 2022 ​ ​ ​ ​ ​ % of net ​ ​ ​ ​ % of net ​ ​ ​ ​ % of net ​ ​ (in thousands) revenue (in thousands) revenue (in thousands) revenue Statements of Operations Data: ​ ​ ​ ​ Net revenue ​ $ 647,040 100.0 % $ 508,685 100.0 % $ 324,520 100.0 % Cost of revenue ​ 178,718 27.6 ​ 150,456 29.6 ​ 106,470 32.8 ​ Gross profit ​ 468,322 72.4 ​ 358,229 70.4 ​ 218,050 67.2 ​ Selling, general and administrative expenses ​ 352,722 54.5 ​ 283,911 55.8 ​ 190,385 58.7 ​ Operating income ​ 115,600 17.9 ​ 74,318 14.6 ​ 27,665 8.5 ​ Financial income, net ​ (12,306) (1.9) ​ (4,283) (0.8) ​ (1,247) (0.4) ​ Income before taxes on income ​ 127,906 19.8 ​ 78,601 15.4 ​ 28,912 8.9 ​ Taxes on income ​ 26,415 4.1 ​ 20,067 3.9 ​ 7,184 2.2 ​ Net income ​ $ 101,491 15.7 % $ 58,534 11.5 % $ 21,728 6.7 % ​ 72 Table of Contents Comparison of Year Ended December 31, 2024 and 2023 Net Revenue ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2024 2023 ​ $ Change % Change ​ ​ (in thousands) ​ Net revenue $ 647,040 $ 508,685 $ 138,355 27.2 % ​ Net revenue increased by $138.4 million, or 27.2%, for the year ended December 31, 2024 compared to the year ended December 31, 2023.
Our historical results and period-to-period comparisons for any prior period are not necessarily indicative of results expected in any future period. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2025 ​ 2024 ​ 2023 ​ ​ ​ ​ ​ % of net ​ ​ ​ ​ % of net ​ ​ ​ ​ % of net ​ ​ ​ ​ ​ (in thousands) ​ ​ ​ revenue ​ ​ ​ (in thousands) ​ ​ ​ revenue ​ ​ ​ (in thousands) ​ ​ ​ revenue Statements of Operations Data: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net revenue ​ $ 809,844 100 % $ 647,040 100.0 % $ 508,685 100.0 % Cost of revenue ​ 221,138 27.3 ​ 178,718 27.6 ​ 150,456 29.6 ​ Gross profit ​ 588,706 72.7 ​ 468,322 72.4 ​ 358,229 70.4 ​ Selling, general and administrative expenses ​ 469,936 58.0 ​ 352,722 54.5 ​ 283,911 55.8 ​ Operating income ​ 118,770 14.7 ​ 115,600 17.9 ​ 74,318 14.6 ​ Financial income, net ​ (16,935) (2.1) ​ (12,306) (1.9) ​ (4,283) (0.8) ​ Income before taxes on income ​ 135,705 16.8 ​ 127,906 19.8 ​ 78,601 15.4 ​ Taxes on income ​ 24,960 3.1 ​ 26,415 4.1 ​ 20,067 3.9 ​ Net income ​ $ 110,745 13.7 % $ 101,491 15.7 % $ 58,534 11.5 % ​ Comparison of Years Ended December 31, 2025 and 2024 Net Revenue ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2025 2024 ​ $ Change % Change ​ ​ (in thousands) ​ Net revenue ​ ​ ​ $ 809,844 ​ ​ ​ $ 647,040 ​ ​ ​ $ 162,804 ​ ​ ​ 25.2 % ​ Net revenue increased by $163 million, or 25.2%, for the year ended December 31, 2025 compared to the year ended December 31, 2024.
GAAP. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2024 ​ 2023 ​ 2022 ​ ​ (in thousands) Operating income $ 115,600 $ 74,318 $ 27,665 Share-based compensation ​ 25,022 ​ 24,111 ​ 6,697 Non-recurring adjustments ​ — ​ 300 ​ 701 Adjusted operating income ​ $ 140,622 ​ $ 98,729 ​ $ 35,063 ​ 77 Table of Contents Adjusted Net Income Adjusted net income is defined as net income adjusted for the impact of share-based compensation, non-recurring adjustments, and the tax effect of Non-GAAP adjustments.
GAAP. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2025 ​ 2024 ​ 2023 ​ ​ (in thousands) Operating income ​ ​ ​ $ 118,770 ​ ​ ​ $ 115,600 ​ ​ ​ $ 74,318 Share-based compensation ​ 33,891 ​ 25,022 ​ 24,111 Non-recurring adjustments ​ — ​ — ​ 300 Adjusted operating income ​ $ 152,661 ​ $ 140,622 ​ $ 98,729 ​ 77 Table of Contents Adjusted Net Income Adjusted net income is defined as net income adjusted for the impact of share-based compensation, non-recurring adjustments, one-time tax gains/losses and the tax effect of Non-GAAP adjustments.
The changes in operating assets and liabilities were primarily driven by an increase in trade payables and other accounts payable, partially offset by an increase in inventory and prepaid expenses and other current assets.
The changes in operating assets and liabilities were primarily driven by an increase in inventory and prepaid expenses and other receivables.
The 2024 Credit Facilities also contained customary affirmative and negative covenants, as well as certain financial covenants, including that the Company’s shareholder equity ratio would not fall, at any given time, below 20% and that the net debt-to-EBITDA ratio of the Company would not exceed 3x of EBITDA.
The 2024 Credit Facilities contained customary affirmative and negative covenants, as well as financial covenants requiring the Company’s shareholders’ equity ratio to not fall below 20% at any time and the Company’s Net Debt-to-EBITDA ratio to not exceed 3.0x.
It drives our financial model through increased conversion, higher average order value, and repeat frequency. We believe our investment in molecule discovery with ODDITY LABS will deepen our competitive advantage in product development. Expanding our Global Footprint Our upfront investments in technology allow us to scale in new markets quickly and with limited asset intensity.
We believe our investment in molecule discovery with ODDITY LABS will deepen our competitive advantage in product development. 71 Table of Contents Expanding our Global Footprint Our upfront investments in technology allow us to scale in new markets quickly and with limited asset intensity.
Our net cash for the year ended December 31, 2023 and 2022 consisted of $58.5 million and $21.7 million of net income, adjusted for $32.2 million and $11.1 million of non-cash expenses and $(3.2) million and $6.2 million of net cash (used in) provided as a result of changes in operating assets and liabilities, respectively.
Our net cash provided by operating activities for the years ended December 31, 2025 and 2024 consisted of $110.7 million and $101.5 million of net income, adjusted for $45.1 million and $33.6 million of non-cash expenses and $(68.2) million and $2.7 million of net cash (used in) provided as a result of changes in operating assets and liabilities, respectively.
Our net revenue increased to $647 million in 2024 from $509 million and $325 million in 2023 and 2022. We achieved net income of $101.5 million, $58.5 million, and $21.7 million in 2024, 2023, and 2022 respectively. We achieved Adjusted EBITDA of $150.4 million in 2024 from $107.3 million and $39.5 million in 2023 and 2022.
Our net revenue increased to $810 million in 2025 from $647 million and $509 million in 2024 and 2023. We achieved net income of $110.7 million, $101.5 million, and $58.5 million in 2025, 2024 and 2023, respectively.
Data collected from users forms a critical component of our customer acquisition funnel as it enables us to efficiently convert users to customers, informs our brand and product roadmap, and improves our machine learning algorithms to more accurately predict product matches and develop new products. 70 Table of Contents A Proven Brand Scaling Machine We have an excellent track record of launching and scaling online brands, starting with IL MAKIAGE in 2018 and SpoiledChild in 2022.
Data collected from users forms a critical component of our customer acquisition funnel as it enables us to efficiently convert users to customers, informs our brand and product roadmap, and improves our machine learning algorithms to more accurately predict product matches and develop new products.
Net cash provided by financing activities was $48.8 million for the year ended December 31, 2023, compared to $0.2 million used in financing activities for the year ended December 31, 2022.
Financing Activities Net cash provided by financing activities was $531.3 million for the year ended December 31, 2025, compared to $127.3 million used in financing activities for the year ended December 31, 2024.
Trend Information For a discussion of the trends that affect our business, financial condition and results of operations, see the sections titled “Item 3.D. Key Information—Risk Factors” and “Item 5.A. Operating and Financial Review and Prospects—Operating Results.” E. Critical Accounting Estimates We believe that the following accounting policies involve a high degree of judgment and complexity.
We review and target our research and development activities on an ongoing basis based on the needs of our business. D. Trend Information For a discussion of the trends that affect our business, financial condition and results of operations, see the sections titled “Item 3.D. Key Information—Risk Factors” and “Item 5.A. Operating and Financial Review and Prospects—Operating Results.” E.
The increase was primarily attributable to interest on bank deposits and marketable securities. See the section titled “Item 5.B. Operating and Financial Review and Prospects—Liquidity and Capital Resources” below.
The increase was primarily attributable to interest on higher cash balances and marketable securities, partly offset by interest expense related to the amortization of issuance costs related to the Exchangeable Notes. See the section titled “Item 5.B. Operating and Financial Review and Prospects—Liquidity and Capital Resources” below.
By excluding certain items that may not be indicative of our recurring core operating results, we believe that Adjusted EBITDA and Adjusted EBITDA margin provide meaningful supplemental information regarding our performance.
GAAP. 76 Table of Contents We believe Adjusted EBITDA and Adjusted EBITDA margin are useful for financial and operational decision-making and as a means to evaluate period-to-period comparisons. By excluding certain items that may not be indicative of our recurring core operating results, we believe that Adjusted EBITDA and Adjusted EBITDA margin provide meaningful supplemental information regarding our performance.
GAAP. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, ​ ​ 2024 ​ 2023 ​ 2022 ​ ​ (in thousands) Net income $ 101,491 $ 58,534 $ 21,728 Share-based compensation ​ 25,022 ​ 24,111 ​ 6,697 Non-recurring adjustments ​ — ​ 300 ​ 701 Tax impact ​ (5,168) ​ (6,232) ​ (1,828) Adjusted net income ​ $ 121,345 ​ $ 76,713 ​ $ 27,298 ​ B.
GAAP. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, ​ ​ 2025 ​ 2024 ​ 2023 ​ ​ (in thousands) Net income ​ ​ ​ $ 110,745 ​ ​ ​ $ 101,491 ​ ​ ​ $ 58,534 Share-based compensation ​ 33,891 ​ 25,022 ​ 24,111 Non-recurring adjustments ​ — ​ — ​ 300 Tax adjustments (1) ​ (8,341) ​ (5,168) ​ (6,232) Adjusted net income ​ $ 136,295 ​ $ 121,345 ​ $ 76,713 (1) Represents the tax impact of (a) the reconciling items above and (b) other discrete tax items. ​ B.
For the year ended December 31, 2023, the non-cash charges included $8.6 million of depreciation and amortization and $24.1 million of share-based compensation. For the year ended December 31, 2022, non-cash charges included $4.4 million of depreciation and amortization, and $6.7 million of share-based compensation.
For the year ended December 31, 2025, non-cash charges included principally $10.7 million of depreciation and amortization and $33.9 million of share-based compensation. For the year ended December 31, 2024, the non-cash charges included principally $9.8 million of depreciation and amortization and $25.0 million of share-based compensation.
The $140.0 million of net cash used in investing activities in the year ended December 31, 2023 was primarily related to a $60.0 million net change in short-term deposits, a $50.0 million investment in marketable securities and $23.2 million related to the acquisition of Revela.
The $267.2 million of net cash used in investing activities in the year ended December 31, 2025 was primarily related to a $298.9 million investment in marketable securities and $3.9 million related to capital expenditures, partially offset by a $48 million net change in short-term deposits.
Financial Income, Net Financial income, net consists primarily of interest income on our bank deposits and marketable securities as well as gain or loss on foreign currency, mainly driven by liabilities denominated in currencies other than U.S. dollars.
Financial Income, Net Financial income, net consists primarily of interest income on our bank deposits and marketable securities, offset by interest expense from the amortization of issuance costs related to the Exchangeable Notes, gains or losses on foreign currencies, mainly driven by liabilities denominated in currencies other than U.S. dollars, and realized gains and losses on the sale of investments.
A reconciliation of the non-GAAP financial measures, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted operating income and Adjusted net income to the most directly comparable financial measures calculated in accordance with U.S.
Other companies, including companies in our industry, may calculate these measures differently or not at all, which reduces their usefulness as comparative measures. A reconciliation of the non-GAAP financial measures, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted operating income and Adjusted net income to the most directly comparable financial measures calculated in accordance with U.S.
Comparison of Years Ended December 31, 2023 and 2022 Net Revenue ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2023 ​ 2022 ​ $ Change ​ % Change ​ ​ (in thousands) Net revenue $ 508,685 $ 324,520 $ 184,165 56.7 % ​ Net revenue increased by $184.2 million, or 56.7%, for the year ended December 31, 2023, compared to the year ended December 31, 2022, primarily driven by a 40.2% increase in orders.
Comparison of Years Ended December 31, 2024 and 2023 Net Revenue ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2024 ​ 2023 ​ $ Change ​ % Change ​ ​ (in thousands) Net revenue ​ ​ ​ $ 647,040 ​ ​ ​ $ 508,685 ​ ​ ​ $ 138,355 ​ ​ ​ 27.2 % ​ Net revenue increased by $138.4 million, or 27.2%, for the year ended December 31, 2024 compared to the year ended December 31, 2023.
We have provided below a reconciliation of Adjusted EBITDA to net income, the most directly comparable financial measure presented in accordance with U.S. GAAP. 76 Table of Contents We believe Adjusted EBITDA and Adjusted EBITDA margin are useful for financial and operational decision-making and as a means to evaluate period-to-period comparisons.
Adjusted EBITDA margin is defined as Adjusted EBITDA divided by net revenue. We have provided below a reconciliation of Adjusted EBITDA to net income, the most directly comparable financial measure presented in accordance with U.S.
Research and Development, Patents and Licenses We have made, and will continue to make, significant investments in research and development and technology in an effort to improve our product offerings and enhance our customer experience. We review and target our research and development activities on an ongoing basis based on the needs of our business. D.
We expect that cash from operating activities and financing activities will be used to meet our capital expenditure needs in the foreseeable future. C. Research and Development, Patents and Licenses We have made, and will continue to make, significant investments in research and development and technology in an effort to improve our product offerings and enhance our customer experience.
Net cash used in investing activities for the year ended December 31, 2023 was $140.0 million, compared to $25.8 million used in investing activities for the year ended December 31, 2022.
Investing Activities Net cash used in investing activities for the year ended December 31, 2025 was $267.2 million, compared to $1.4 million provided by investing activities for the year ended December 31, 2024.
Gross Profit and Gross Margin ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2023 ​ 2022 ​ $ Change ​ % Change ​ ​ (in thousands) Gross profit $ 358,229 $ 218,050 $ 140,179 64.3 % Gross margin ​ 70.4 % 67.2 % 3.2 % ​ 74 Table of Contents Our gross profit increased by $140.2 million, or 64.3%, for the year ended December 31, 2023, compared to the year ended December 31, 2022 as a result of the growth in our net revenue.
Gross Profit and Gross Margin ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2025 ​ 2024 ​ $ Change ​ % Change ​ ​ (in thousands) Gross profit ​ ​ ​ $ 588,706 ​ ​ ​ $ 468,322 ​ ​ ​ $ 120,384 ​ ​ ​ 25.7 % Gross margin ​ 72.7 % 72.4 % ​ 0.3 % ​ Our gross profit increased by $120 million, or 25.7%, for the year ended December 31, 2025 compared to the year ended December 31, 2024 as a result of the growth in our net revenue.
Accordingly, these are the policies we believe are the most critical to aid in fully understanding and evaluating our financial condition and results of our operations. See Note 2 to our consolidated financial statements included elsewhere in this Annual Report for a description of our other significant accounting policies. The preparation of our financial statements in conformity with U.S.
See Note 2 to our consolidated financial statements included elsewhere in this Annual Report for a description of our other significant accounting policies. The preparation of our financial statements in conformity with U.S. GAAP requires us to make estimates and judgments that affect the amounts reported in those financial statements and accompanying notes.
We have additional brands in development, including Brands 3 and 4, which we are building to lead in their respective markets. Successful Product Launches Our data-centric strategy and direct-to-consumer model allow us to create and deliver superior products for our customers. Product innovation across categories has been a key driver of our success.
Successful Product Launches Our data-centric strategy and direct-to-consumer model allow us to create and deliver superior products for our customers. Product innovation across categories has been a key driver of our success. It drives our financial model through increased conversion, higher average order value, and repeat frequency.
Selling, General and Administrative Expenses ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2023 ​ 2022 ​ $ Change ​ % Change ​ ​ (in thousands) Selling, general, and administrative expenses $ 283,911 $ 190,385 $ 93,526 49.1 % ​ Selling, general and administrative expenses increased by $93.5 million, or 49.1%, for the year ended December 31, 2023, compared to the year ended December 31, 2022.
Selling, General and Administrative Expenses ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2025 ​ 2024 ​ $ Change ​ % Change ​ ​ (in thousands) Selling, general and administrative expenses ​ ​ ​ $ 469,936 ​ ​ ​ $ 352,722 ​ ​ ​ $ 117,214 ​ ​ ​ 33.2 % ​ Selling, general and administrative expenses increased by $117 million, or 33.2%, for the year ended December 31, 2025 compared to the year ended December 31, 2024.
We expect our technology roadmap, combined with our user base of approximately 60 million users and our rich, proprietary data sets, will define the future of beauty. We define a user as a visitor on which we have collected at least 50 discrete data points as they engage and interact with our websites.
We expect our technology roadmap, combined with our user base of approximately 68 million users and our rich, proprietary data sets, will define the future of beauty. We define a user as a visitor who has engaged with and interacted with our websites in a way that allows us to recognize their activity during a visit.
The information set forth below should be considered in addition to, not as a substitute for or in isolation from, our financial measures prepared in accordance with U.S. GAAP. Other companies, including companies in our industry, may calculate these measures differently or not at all, which reduces their usefulness as comparative measures.
Non-GAAP Financial Measures We regularly review certain non-GAAP financial measures to evaluate our business, measure our performance, identify trends, prepare financial projections and make business decisions. The information set forth below should be considered in addition to, not as a substitute for or in isolation from, our financial measures prepared in accordance with U.S. GAAP.
Financial Income, Net ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2023 ​ 2022 ​ $ Change ​ % Change ​ ​ (in thousands) Financial Income, net $ (4,283) $ (1,247) $ (3,036) 243.5 % ​ Financial income, net increased by $3.0 million for the year ended December 31, 2023, compared to the year ended December 31, 2022.
Financial Income, Net ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2025 ​ 2024 ​ $ Change ​ % Change ​ ​ (in thousands) Financial income, net ​ ​ ​ $ (16,935) ​ ​ ​ $ (12,306) ​ ​ ​ $ (4,629) ​ ​ ​ 37.6 % ​ Financial income, net increased by $4.6 million, or 37.6%, for the year ended December 31, 2025 compared to the year ended December 31, 2024.
An additional commitment fee of 0.29% will apply to any unused credit. The 2025 Credit Facilities are available for borrowing for a period of one year. The obligations of the Company under the 2025 Credit Facilities benefit from a negative pledge by the Company and are guaranteed by certain of the Company’s subsidiaries.
The obligations of the Company under the 2025 Credit Facilities were subject to a negative pledge by the Company and were guaranteed by certain of the Company’s subsidiaries.
Net cash provided by operating activities increased to $87.5 million for the year ended December 31, 2023, compared to $39.0 million for the year ended December 31, 2022, primarily due to an increase in net income adjusted for certain non-cash expenses and change in working capital.
Net cash provided by operating activities decreased to $87.6 million for the year ended December 31, 2025, compared to $137.8 million for the year ended December 31, 2024, primarily due to inventory investments to support growth, inventory investments to support the launch of METHODIQ and increases in certain prepaid expenses, partially offset by increased net income.
Since our initial public offering in 2023 we have committed to a long-term financial algorithm that targets 20% annual revenue growth and 20% Adjusted EBITDA margin. We exceeded these targets every year as a public company, including 2024 and 2023. A.
We achieved Adjusted EBITDA of $163.3 million in 2025, up from $150.5 million and $107.3 million in 2024 and 2023. 70 Table of Contents Since our initial public offering in 2023 we have maintained long-term financial targets of 20% annual revenue growth and 20% Adjusted EBITDA margin.
GAAP is set forth below under “Non-GAAP Financial Measures.” ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2024 ​ 2023 ​ 2022 Non-GAAP Financial Measures ​ (in thousands) Adjusted EBITDA $ 150,449 $ 107,334 $ 39,471 ​ Adjusted EBITDA margin ​ 23.3 % 21.1 % 12.2 % Adjusted operating income ​ $ 140,622 ​ $ 98,729 ​ $ 35,063 ​ Adjusted net income ​ $ 121,345 ​ $ 76,713 ​ $ 27,298 ​ ​ Note Regarding the Disclosure of Order Billings Since our IPO, we have disclosed Order billings, which represent amounts invoiced to customers during the period.
GAAP is set forth below. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2025 ​ 2024 ​ 2023 Non-GAAP Financial Measures ​ (in thousands) Adjusted EBITDA ​ ​ ​ $ 163,348 ​ ​ ​ $ 150,449 ​ ​ ​ $ 107,334 ​ Adjusted EBITDA margin ​ 20.2 % 23.3 % 21.1 % Adjusted operating income ​ $ 152,661 ​ $ 140,622 ​ $ 98,729 ​ Adjusted net income ​ $ 136,295 ​ $ 121,345 ​ $ 76,713 ​ ​ Adjusted EBITDA and Adjusted EBITDA Margin Adjusted EBITDA is defined as net income before financial income, net, taxes on income, and depreciation and amortization as further adjusted to exclude share-based compensation expense, and non-recurring adjustments.
Stock-based compensation expense including expenses associated with accelerated vesting related to our IPO was $24.1 million for the year ended December 31, 2023, compared to stock-based compensation expense of $6.7 million for the year ended December 31, 2022.
Stock-based compensation expense was $33.9 million for the year ended December 31, 2025, compared to stock-based compensation expense of $25.0 million for the year ended December 31, 2024.
Selling, General and Administrative Expenses Selling, general and administrative expenses primarily consist of marketing and advertising expenses, employee-related costs, including salaries, benefits, and share-based compensation, depreciation, and amortization expenses, professional fees, payments processing fees, and other general expenses.
We expect that gross profit will fluctuate and continue to be affected by various factors in the future, including the timing and mix of product and brand launches, commodity prices and transportation rates, manufacturing costs, and cost efficiency efforts. 72 Table of Contents Selling, General and Administrative Expenses Selling, general and administrative expenses primarily consist of marketing and advertising expenses, employee-related costs, including salaries, benefits, and share-based compensation, rent, software and product research and development costs, depreciation and amortization expenses, professional fees, payments processing fees, and other general expenses.
The $127.3 million of net cash used in financing activities was primarily related to $147.3 million purchase of treasury shares, partially offset by $19.0 million proceeds from exercise of options.
The $531.3 million of net cash provided by financing activities was primarily related to $582.5 million of net proceeds from the issuance of our Exchangeable Notes, and $12.2 million proceeds from exercise of options, partially offset by $63.4 million incurred to purchase the capped call options pursuant to the Capped Call Transactions, inclusive of related transaction costs.
Off-Balance Sheet Obligations As of December 31, 2024, we had not entered into any off-balance sheet arrangements. Capital Expenditures Our capital expenditures amounted to approximately $3.3 million for the year ended December 31, 2024, approximately $2.1 million for the year ended December 31, 2023 and approximately $2.3 million for the year ended December 31, 2022.
Capital Expenditures Our capital expenditures amounted to approximately $3.9 million for the year ended December 31, 2025, approximately $3.3 million for the year ended December 31, 2024 and approximately $2.1 million for the year ended December 31, 2023. Our historical capital expenditures are primarily related to expenditures associated with our headquarters, retail leasehold improvements, as well as other office expenses.
Taxes on Income ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2023 ​ 2022 ​ $ Change ​ % Change ​ ​ (in thousands) Taxes on Income $ 20,067 $ 7,184 $ 12,883 179.3 % ​ Taxes on income increased by $12.9 million, or 179.3%, for the year ended December 31, 2023, compared to the year ended December 31, 2022.
Taxes on Income ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2025 ​ 2024 ​ $ Change ​ % Change ​ ​ (in thousands) Taxes on income ​ ​ ​ $ 24,960 ​ ​ ​ $ 26,415 ​ ​ ​ $ (1,455) ​ ​ ​ (5.5) % ​ 74 Table of Contents Taxes on income decreased by $1.5 million, or 5.5%, for the year ended December 31, 2025, compared to the year ended December 31, 2024.
The $48.8 million of net cash provided by financing activities was primarily related to net proceeds of $53.0 million from our initial public offering. 80 Table of Contents Contractual Obligations The following table summarizes our contractual obligations as of December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less ​ ​ ​ ​ ​ ​ ​ More ​ ​ ​ ​ ​ than ​ ​ ​ ​ ​ ​ ​ than ​ ​ Total ​ 1 Year ​ 1 - 3 Years ​ 3 - 5 Years ​ 5 Years ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating lease commitments $ 29,803 $ 9,006 $ 10,559 $ 7,054 $ 3,184 Severance pay obligations (1) ​ 2,254 ​ — ​ — ​ — ​ — Total contractual obligations ​ $ 32,057 ​ $ 9,006 ​ $ 10,559 ​ $ 7,054 ​ $ 3,184 (1) Severance pay obligations to our Israeli employees, as required under Israeli labor law, are payable only upon termination, retirement or death of the respective employee.
The $127.3 million of net cash used in financing activities was primarily related to $147.3 million purchase of treasury shares, partially offset by $19.0 million proceeds from exercise of options. 81 Table of Contents Contractual Obligations The following table summarizes our material contractual obligations as of December 31, 2025: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less ​ ​ ​ ​ ​ ​ ​ More ​ ​ ​ ​ ​ than ​ ​ ​ ​ ​ ​ ​ than ​ ​ Total ​ 1 Year ​ 1 - 3 Years ​ 3 - 5 Years ​ 5 Years ​ ​ (in thousands) Exchangeable Notes (1) ​ $ 600,000 ​ $ — ​ $ — ​ $ 600,000 ​ $ — Operating lease commitments ​ ​ ​ ​ 29,078 ​ ​ ​ ​ 7,956 ​ ​ ​ ​ 10,092 ​ ​ ​ ​ 7,720 ​ ​ ​ ​ 3,310 Severance pay obligations (2) ​ 3,423 ​ — ​ — ​ — ​ — Total contractual obligations ​ $ 632,501 ​ $ 7,956 ​ $ 10,092 ​ $ 607,720 ​ $ 3,310 (1) Consists of principal on our 0% Exchangeable Notes due June 15, 2030.
The 2025 Credit Facilities contain customary affirmative and negative covenants, as well as certain financial covenants, including that the Company’s shareholder equity ratio (generally calculated by dividing total shareholders’ equity by total assets) shall not fall, at any given time, below 20% and that the net debt-to-EBITDA ratio of the Company does not exceed 3x of EBITDA; they are governed by Israeli law. 2024 Credit Facilities In January 2024, we entered into separate credit facility arrangements with two Israeli banks, Bank Leumi and Bank Hapoalim (the “2024 Credit Facilities”), denominated in U.S. dollars, pursuant to which we were permitted to withdraw an aggregate principal amount of up to $100 million.
The 2025 Credit Facilities contained customary affirmative and negative covenants, as well as financial covenants requiring the Company’s shareholders’ equity ratio to not fall below 20% at any time and the Company’s Net Debt-to-EBITDA ratio to not exceed 3.0x. The 2025 Credit Facilities were governed by Israeli law.
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Gross margin measures our gross profit as a percentage of net revenue. We expect that gross profit will fluctuate and continue to be affected by various factors in the future, including the timing and mix of product and brand launches, commodity prices and transportation rates, manufacturing costs, and our ability to reduce costs in any given period.
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We exceeded these targets every year as a public company, including 2025, 2024 and 2023. As previously disclosed, we have experienced a significant increase in customer acquisition costs that is adversely impacting our revenues and margins. We hope these elevated costs will eventually normalize and therefore we have not changed our long-term financial targets.
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We expect selling, general and administrative expense to continue to increase in absolute dollars as we grow our business, expand our workforce, implement new marketing strategies, and enhance our platform and product offerings, brands, and infrastructure.
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However, we do not expect to achieve our long-term financial targets for so long as our customer acquisition costs remain elevated. See “Item 3.D. Key Information—Risk Factors— Risks Related to Our Business and Industry— The success of our business depends on our ability to attract new customers, retain existing customers, and maintain or increase sales to those customers.
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We also anticipate that we will incur additional costs for employees and third-party consulting services, including related to legal, accounting, insurance, and investor relations, in connection with our operations as a public company.
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We have recently experienced difficulty acquiring new customers cost-efficiently and, if this difficulty continues, our business, financial condition, and results of operations will be adversely affected.” A.
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Order billings increased 50.6% to $595.8 million for the year ended December 31, 2023 compared to the year ended December 31, 2022. The return rate decreased to 12.0% for the year ended December 31, 2023 compared to 14.8% for the year ended December 31, 2022.
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A Proven Brand Scaling Machine We have an excellent track record of launching and scaling online brands, starting with IL MAKIAGE in 2018, SpoiledChild in 2022 and METHODIQ in 2025. We have additional brands in development which we are building to lead in their respective markets.
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Cost of Revenue ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2023 ​ 2022 ​ $ Change ​ % Change ​ ​ (in thousands) Cost of revenue $ 150,456 $ 106,470 $ 43,986 41.3 % ​ Cost of revenue increased by $44.0 million, or 41.3%, for the year ended December 31, 2023, compared to the year ended December 31, 2022.
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Gross margin measures our gross profit as a percentage of net revenue.
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We incurred $17.4 million of one-time compensation expense to our founders related to the SpoiledChild incentive plan for the year ended December 31, 2023, compared to $12.6 million for the year ended December 31, 2022.
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We have recently incurred higher selling, general and administrative expenses due to a significant increase in our customer acquisition costs. If this trend continues, selling, general and administrative expenses will increase in absolute dollars more rapidly than they otherwise would.
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The increase was primarily driven by higher earnings before tax. 75 Table of Contents Non-GAAP Financial Measures We regularly review certain non-GAAP financial measures to evaluate our business, measure our performance, identify trends, prepare financial projections and make business decisions.
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The increase in net revenue was driven primarily by higher order volume. The return rate of 11.0% for the year ended December 31, 2025 was in line with the return rate of 10.9% for the year ended December 31, 2024.
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However, going forward, we have decided not to report Order billings as we believe that this measure is no longer an appropriate metric to evaluate trends in our operating results and we no longer use it to contemporaneously assess and monitor our operating performance.
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Online direct-to-consumer net revenue generated by ODDITY through its online platform represented 97% of net revenue for the year ended December 31, 2025, compared to 95% for the year ended December 31, 2024.

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Selected Financial Data — reserved (removed by SEC in 2021)

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Audit Committee Role Our board of directors has adopted an audit committee charter setting forth the responsibilities of the audit committee, which are consistent with the Companies Law, the SEC rules and the corporate governance rules of Nasdaq and include: ● retaining and terminating our independent auditors, subject to ratification by the board of directors, and in the case of retention, subject to ratification by our shareholders; ● pre-approving audit and non-audit services to be provided by the independent auditors and related fees and terms; ● overseeing the accounting and financial reporting processes of the Company and audits of our financial statements, the effectiveness of our internal control over financial reporting, and making such reports as may be required of an audit committee under the rules and regulations promulgated under the Exchange Act; ● reviewing with management and our independent auditor our annual and quarterly financial statements prior to publication or filing (or submission, as the case may be) to the SEC; ● recommending to the board of directors the retention and termination of the internal auditor and the internal auditor’s engagement fees and terms, in accordance with the Companies Law, approving the yearly or periodic work plan proposed by the internal auditor and examining whether the internal auditor was afforded all required resources to perform its role; ● reviewing with our general counsel and/or external counsel, as deemed necessary, legal, and regulatory matters that could have a material impact on the financial statements; ● identifying irregularities in our business administration by, among other things, consulting with the internal auditor or with the independent auditor, and suggesting corrective measures to the board of directors; ● reviewing policies and procedures with respect to transactions between us and officers and directors (other than transactions related to the compensation or terms of service of the officers and directors), or affiliates of officers or directors, or transactions that are not in the ordinary course of our business, and deciding whether to approve such acts and transactions if so required under the Companies Law; and ● establishing procedures for the handling of employees’ complaints as to the management of our business and the protection to be provided to such employees. 102 Table of Contents Internal Auditor Under the Companies Law, the board of directors of a public company is required to appoint an internal auditor based on the recommendation of the audit committee.
Audit Committee Role Our board of directors has adopted an audit committee charter setting forth the responsibilities of the audit committee, which are consistent with the Companies Law, the SEC rules and the corporate governance rules of Nasdaq and include: ● retaining and terminating our independent auditors, subject to ratification by the board of directors, and in the case of retention, subject to ratification by our shareholders; ● pre-approving audit and non-audit services to be provided by the independent auditors and related fees and terms; ● overseeing the accounting and financial reporting processes of the Company and audits of our financial statements, the effectiveness of our internal control over financial reporting, and making such reports as may be required of an audit committee under the rules and regulations promulgated under the Exchange Act; ● reviewing with management and our independent auditor our annual and quarterly financial statements prior to publication or filing (or submission, as the case may be) to the SEC; ● recommending to the board of directors the retention and termination of the internal auditor and the internal auditor’s engagement fees and terms, in accordance with the Companies Law, approving the yearly or periodic work plan proposed by the internal auditor and examining whether the internal auditor was afforded all required resources to perform its role; ● reviewing with our general counsel and/or external counsel, as deemed necessary, legal, and regulatory matters that could have a material impact on the financial statements; ● identifying irregularities in our business administration by, among other things, consulting with the internal auditor or with the independent auditor, and suggesting corrective measures to the board of directors; ● reviewing policies and procedures with respect to transactions between us and officers and directors (other than transactions related to the compensation or terms of service of the officers and directors), or affiliates of officers or directors, or transactions that are not in the ordinary course of our business, and deciding whether to approve such acts and transactions if so required under the Companies Law; and ● establishing procedures for the handling of employees’ complaints as to the management of our business and the protection to be provided to such employees. 103 Table of Contents Internal Auditor Under the Companies Law, the board of directors of a public company is required to appoint an internal auditor based on the recommendation of the audit committee.
Compensation Committee Role In accordance with the Companies Law, the roles of the compensation committee are, among others, as follows: ● making recommendations to the board of directors with respect to the approval of the compensation policy for office holders and to make recommendations to the board of directors, once every three years, regarding the approval of the extension of such compensation policy; ● reviewing the implementation of the compensation policy and periodically making recommendations to the board of directors with respect to any amendments or updates of the compensation policy; ● resolving whether or not to approve arrangements with office holders; and ● exempting, under certain circumstances, transactions with our Chief Executive Officer from the approval of our shareholders. 103 Table of Contents Our board of directors has adopted a compensation committee charter setting forth the responsibilities of the compensation committee, which are consistent with the corporate governance rules of Nasdaq and include among others: ● recommending to our board of directors for its approval of a compensation policy in accordance with the requirements of the Companies Law, incentive-based and equity-based compensation plans (insofar as these relate to office holders in the Company); overseeing the development and implementation of such policies and incentive-based and equity-based compensation plans; and recommending to our board of directors any amendments or modifications to such policies and plans that the committee deems appropriate, including as required under the Companies Law; ● reviewing and approving the employment and engagement terms of our office holders, including granting of stock options and other incentive-based awards and reviewing and approving corporate goals and objectives relevant to the compensation of our executive officers, including evaluating their performance in light of such goals and objectives; and ● approving and exempting certain transactions regarding office holders’ compensation pursuant to the Companies Law.
Compensation Committee Role In accordance with the Companies Law, the roles of the compensation committee are, among others, as follows: ● making recommendations to the board of directors with respect to the approval of the compensation policy for office holders and to make recommendations to the board of directors, once every three years, regarding the approval of the extension of such compensation policy; ● reviewing the implementation of the compensation policy and periodically making recommendations to the board of directors with respect to any amendments or updates of the compensation policy; ● resolving whether or not to approve arrangements with office holders; and ● exempting, under certain circumstances, transactions with our Chief Executive Officer from the approval of our shareholders. 104 Table of Contents Our board of directors has adopted a compensation committee charter setting forth the responsibilities of the compensation committee, which are consistent with the corporate governance rules of Nasdaq and include among others: ● recommending to our board of directors for its approval of a compensation policy in accordance with the requirements of the Companies Law, incentive-based and equity-based compensation plans (insofar as these relate to office holders in the Company); overseeing the development and implementation of such policies and incentive-based and equity-based compensation plans; and recommending to our board of directors any amendments or modifications to such policies and plans that the committee deems appropriate, including as required under the Companies Law; ● reviewing and approving the employment and engagement terms of our office holders, including granting of stock options and other incentive-based awards and reviewing and approving corporate goals and objectives relevant to the compensation of our executive officers, including evaluating their performance in light of such goals and objectives; and ● approving and exempting certain transactions regarding office holders’ compensation pursuant to the Companies Law.
The Companies Law provides that a person is not qualified to be appointed as an external director if (i) the person is a relative of a controlling shareholder of the company, or (ii) that person or his or her relative, partner, employer, another person to whom he or she was directly or indirectly subordinate, or any entity under the person’s control, has or had during the two years preceding the date of appointment as an external director: (a) any affiliation or other disqualifying relationship with the company, with any person or entity controlling the company or a relative of such person, or with any entity controlled by or under common control with the company; or (b) in the case of a company with no controlling shareholder or any shareholder holding 25% or more of its voting rights, had at the date of appointment as an external director any affiliation or other disqualifying relationship with a person then serving as chairman of the board or chief executive officer, a holder of 5% or more of the issued share capital or voting power in the company or the most senior financial officer. 99 Table of Contents The term “relative” is defined in the Companies Law as a spouse, sibling, parent, grandparent or descendant, a spouse’s sibling, parent or descendant and the spouse of each of the foregoing persons.
The Companies Law provides that a person is not qualified to be appointed as an external director if (i) the person is a relative of a controlling shareholder of the company, or (ii) that person or his or her relative, partner, employer, another person to whom he or she was directly or indirectly subordinate, or any entity under the person’s control, has or had during the two years preceding the date of appointment as an external director: (a) any affiliation or other disqualifying relationship with the company, with any person or entity controlling the company or a relative of such person, or with any entity controlled by or under common control with the company; or (b) in the case of a company with no controlling shareholder or any shareholder holding 25% or more of its voting rights, had at the date of appointment as an external director any affiliation or other disqualifying relationship with a person then serving as chairman of the board or chief executive officer, a holder of 5% or more of the issued share capital or voting power in the company or the most senior financial officer. 100 Table of Contents The term “relative” is defined in the Companies Law as a spouse, sibling, parent, grandparent or descendant, a spouse’s sibling, parent or descendant and the spouse of each of the foregoing persons.
An Israeli company may insure an office holder against the following liabilities incurred for acts performed as an office holder if and to the extent provided in the company’s articles of association: ● a breach of the duty of loyalty to the company, to the extent that the office holder acted in good faith and had a reasonable basis to believe that the act would not prejudice the company; ● a breach of the duty of care to the company or to a third party, to the extent such breach arises out of the negligent conduct of the office holder; ● a financial liability imposed on the office holder in favor of a third party; ● a financial liability imposed on the office holder in favor of a third party harmed by a breach in an administrative proceeding; and ● expenses, including reasonable litigation expenses and legal fees, incurred by the office holder as a result of an administrative proceeding instituted against him or her, pursuant to certain provisions of the Israeli Securities Law. 105 Table of Contents An Israeli company may not indemnify, exculpate or insure an office holder against any of the following: ● a breach of the duty of loyalty, except to the extent that the office holder acted in good faith and had a reasonable basis to believe that the act would not prejudice the company; ● a breach of the duty of care committed intentionally or recklessly, excluding a breach arising out of the negligent conduct of the office holder; ● an act or omission committed with intent to derive illegal personal benefit; or ● a civil or criminal fine, monetary sanction or forfeit levied against the office holder.
An Israeli company may insure an office holder against the following liabilities incurred for acts performed as an office holder if and to the extent provided in the company’s articles of association: ● a breach of the duty of loyalty to the company, to the extent that the office holder acted in good faith and had a reasonable basis to believe that the act would not prejudice the company; ● a breach of the duty of care to the company or to a third party, to the extent such breach arises out of the negligent conduct of the office holder; ● a financial liability imposed on the office holder in favor of a third party; ● a financial liability imposed on the office holder in favor of a third party harmed by a breach in an administrative proceeding; and ● expenses, including reasonable litigation expenses and legal fees, incurred by the office holder as a result of an administrative proceeding instituted against him or her, pursuant to certain provisions of the Israeli Securities Law. 106 Table of Contents An Israeli company may not indemnify, exculpate or insure an office holder against any of the following: ● a breach of the duty of loyalty, except to the extent that the office holder acted in good faith and had a reasonable basis to believe that the act would not prejudice the company; ● a breach of the duty of care committed intentionally or recklessly, excluding a breach arising out of the negligent conduct of the office holder; ● an act or omission committed with intent to derive illegal personal benefit; or ● a civil or criminal fine, monetary sanction or forfeit levied against the office holder.
The compensation policy must furthermore consider the following additional factors: ● the education, skills, experience, expertise and accomplishments of the relevant office holder; ● the office holder’s position and responsibilities; ● prior compensation agreements with the office holder; ● the ratio between the cost of the terms of employment of an office holder and the cost of the employment of other employees of the company, including employees employed through contractors who provide services to the company, in particular the ratio between such cost to the average and median salary of such employees of the company, as well as the impact of disparities between them on the work relationships in the company; ● if the terms of employment include variable components: the possibility of reducing variable components at the discretion of the board of directors and the possibility of setting a limit on the value of non-cash variable equity-based components; and 86 Table of Contents ● if the terms of employment include severance compensation: the term of employment or office of the office holder, the terms of the office holder’s compensation during such period, the company’s performance during such period, the office holder’s individual contribution to the achievement of the company goals, and the maximization of its profits and the circumstances under which he or she is leaving the company.
The compensation policy must furthermore consider the following additional factors: ● the education, skills, experience, expertise and accomplishments of the relevant office holder; ● the office holder’s position and responsibilities; ● prior compensation agreements with the office holder; ● the ratio between the cost of the terms of employment of an office holder and the cost of the employment of other employees of the company, including employees employed through contractors who provide services to the company, in particular the ratio between such cost to the average and median salary of such employees of the company, as well as the impact of disparities between them on the work relationships in the company; ● if the terms of employment include variable components: the possibility of reducing variable components at the discretion of the board of directors and the possibility of setting a limit on the value of non-cash variable equity-based components; and 87 Table of Contents ● if the terms of employment include severance compensation: the term of employment or office of the office holder, the terms of the office holder’s compensation during such period, the company’s performance during such period, the office holder’s individual contribution to the achievement of the company goals, and the maximization of its profits and the circumstances under which he or she is leaving the company.
Dividend equivalents will only be paid out to the extent the underlying award vests, which payments will be made no later than March 15 of the calendar year following the calendar year in which the right to the dividend equivalent payment becomes nonforfeitable, unless otherwise determined by the plan administrator. 93 Table of Contents Certain Transactions and Adjustments The plan administrator has broad discretion to take action under the 2023 Plan, as well as make adjustments to the terms and conditions of existing and future awards, to prevent the dilution or enlargement of intended benefits and facilitate necessary or desirable changes in the event of certain transactions and events affecting our Class A ordinary shares, such as share dividends, share splits, mergers, consolidations and other corporate transactions.
Dividend equivalents will only be paid out to the extent the underlying award vests, which payments will be made no later than March 15 of the calendar year following the calendar year in which the right to the dividend equivalent payment becomes nonforfeitable, unless otherwise determined by the plan administrator. 94 Table of Contents Certain Transactions and Adjustments The plan administrator has broad discretion to take action under the 2023 Plan, as well as make adjustments to the terms and conditions of existing and future awards, to prevent the dilution or enlargement of intended benefits and facilitate necessary or desirable changes in the event of certain transactions and events affecting our Class A ordinary shares, such as share dividends, share splits, mergers, consolidations and other corporate transactions.
However, if at least one of our unaffiliated directors (i) meets the independence requirements under the Exchange Act, (ii) meets the independence requirements of Nasdaq rules for membership on the audit committee and (iii) has accounting and financial expertise as defined under the Companies Law, then neither of our external directors is required to possess accounting and financial expertise as long as each possesses the requisite professional qualifications. 100 Table of Contents A director with accounting and financial expertise is a director who, due to his or her education, experience and skills, possesses an expertise in, and an understanding of, financial and accounting matters and financial statements, such that he or she is able to understand the financial statements of the company and initiate a discussion about the presentation of financial data.
However, if at least one of our unaffiliated directors (i) meets the independence requirements under the Exchange Act, (ii) meets the independence requirements of Nasdaq rules for membership on the audit committee and (iii) has accounting and financial expertise as defined under the Companies Law, then neither of our external directors is required to possess accounting and financial expertise as long as each possesses the requisite professional qualifications. 101 Table of Contents A director with accounting and financial expertise is a director who, due to his or her education, experience and skills, possesses an expertise in, and an understanding of, financial and accounting matters and financial statements, such that he or she is able to understand the financial statements of the company and initiate a discussion about the presentation of financial data.
No award may be granted under the 2023 Plan after the tenth anniversary of the earlier of (i) the date the board of directors adopted the 2023 Plan or (ii) the date our shareholders approved the 2023 Plan. 92 Table of Contents Limitation on Awards and Shares Available The aggregate number of shares available for issuance under the 2023 Plan is equal to the sum of (1) 4,524,000 Class A ordinary shares plus (2) an annual increase on January 1 of each calendar year beginning in 2024 and ending on and including 2033, by an amount equal to the lesser of (a) 5% of the shares outstanding on the final day of the immediately preceding calendar year and (b) such smaller number of shares as determined by our board of directors.
No award may be granted under the 2023 Plan after the tenth anniversary of the earlier of (i) the date the board of directors adopted the 2023 Plan or (ii) the date our shareholders approved the 2023 Plan. 93 Table of Contents Limitation on Awards and Shares Available The aggregate number of shares available for issuance under the 2023 Plan is equal to the sum of (1) 4,524,000 Class A ordinary shares plus (2) an annual increase on January 1 of each calendar year beginning in 2024 and ending on and including 2033, by an amount equal to the lesser of (a) 5% of the shares outstanding on the final day of the immediately preceding calendar year and (b) such smaller number of shares as determined by our board of directors.
In the event that the chief executive officer candidate also serves as a member of the board of directors, his or her compensation terms as the chief executive officer will be approved in accordance with the rules applicable to approval of compensation of directors. 88 Table of Contents In addition, according to the Companies Law, with respect to the compensation of an office holder who is also considered a controlling shareholder (or such controlling shareholder’s relative), approval is also required by (i) the company’s compensation committee, (ii) the company’s board of directors and (iii) the company’s shareholders (by a special majority vote as discussed above with respect to the approval of the compensation policy).
In the event that the chief executive officer candidate also serves as a member of the board of directors, his or her compensation terms as the chief executive officer will be approved in accordance with the rules applicable to approval of compensation of directors. 89 Table of Contents In addition, according to the Companies Law, with respect to the compensation of an office holder who is also considered a controlling shareholder (or such controlling shareholder’s relative), approval is also required by (i) the company’s compensation committee, (ii) the company’s board of directors and (iii) the company’s shareholders (by a special majority vote as discussed above with respect to the approval of the compensation policy).
Niv Price has served as our Chief Technology Officer since July 2021. Prior to joining us, Mr. Price co-founded and served as director and Chief Executive Office of Voyage81 LTD from April 2018 until our acquisition of Voyage81 LTD in July 2021. Mr.
Niv Price has served as our Chief Technology Officer since July 2021. Prior to joining us, Mr. Price co-founded and served as director and Chief Executive Officer of Voyage81 LTD from April 2018 until our acquisition of Voyage81 LTD in July 2021. Mr.
Pursuant to a resolution of our board of directors, the incentive awards committee has been delegated with the authority, subject to applicable law, to: ● grant awards under the 2023 Plan subject to criteria determined by the board of directors and to approve the issuance of ordinary shares as a result of the exercise, vesting, settlement or conversion (as applicable) of such awards; and ● administer the 2023 Plan. 104 Table of Contents Exculpation, Insurance, and Indemnification of Office Holders Under the Companies Law, a company may not exculpate an office holder from liability for a breach of the duty of loyalty.
Pursuant to a resolution of our board of directors, the incentive awards committee has been delegated with the authority, subject to applicable law, to: ● grant awards under the 2023 Plan subject to criteria determined by the board of directors and to approve the issuance of ordinary shares as a result of the exercise, vesting, settlement or conversion (as applicable) of such awards; and ● administer the 2023 Plan. 105 Table of Contents Exculpation, Insurance, and Indemnification of Office Holders Under the Companies Law, a company may not exculpate an office holder from liability for a breach of the duty of loyalty.
If an award holder breaches any restrictive covenants set forth in an award agreement or any other agreement during or after the termination of engagement, the award holder will forfeit or repay back: (i) any and all outstanding awards, including vested or exercisable awards, (ii) any shares issued within the 12-month period immediately preceding the termination and thereafter (less any exercise price paid for such shares) and (iii) the profit realized from the exercise and sale of any award or share within the 12-month period immediately preceding the termination. 91 Table of Contents U.S.
If an award holder breaches any restrictive covenants set forth in an award agreement or any other agreement during or after the termination of engagement, the award holder will forfeit or repay back: (i) any and all outstanding awards, including vested or exercisable awards, (ii) any shares issued within the 12-month period immediately preceding the termination and thereafter (less any exercise price paid for such shares) and (iii) the profit realized from the exercise and sale of any award or share within the 12-month period immediately preceding the termination. 92 Table of Contents U.S.
A director so appointed will hold office until the next annual general meeting of our shareholders for the class of directors in respect of which the vacancy was created, or in the case of a vacancy due to the number of directors being less than the maximum number of directors stated in our amended and restated articles of association, until the next annual general meeting of our shareholders for the class of directors to which such director has been assigned by our board of directors. 97 Table of Contents Chairperson of the Board Our amended and restated articles of association provide that the chairperson of the board of directors is appointed by the members of the board of directors.
A director so appointed will hold office until the next annual general meeting of our shareholders for the class of directors in respect of which the vacancy was created, or in the case of a vacancy due to the number of directors being less than the maximum number of directors stated in our amended and restated articles of association, until the next annual general meeting of our shareholders for the class of directors to which such director has been assigned by our board of directors. 98 Table of Contents Chairperson of the Board Our amended and restated articles of association provide that the chairperson of the board of directors is appointed by the members of the board of directors.
A participant is not permitted to transfer rights granted under the ESPP other than by will, the laws of descent and distribution or as otherwise provided under the ESPP. 95 Table of Contents In the event of certain transactions or events affecting our shares, such as any share dividend or other distribution, reorganization, merger, consolidation, or other corporate transaction, the plan administrator will make equitable adjustments to the ESPP and outstanding rights.
A participant is not permitted to transfer rights granted under the ESPP other than by will, the laws of descent and distribution or as otherwise provided under the ESPP. 96 Table of Contents In the event of certain transactions or events affecting our shares, such as any share dividend or other distribution, reorganization, merger, consolidation, or other corporate transaction, the plan administrator will make equitable adjustments to the ESPP and outstanding rights.
Our directors who are not external directors are divided among the three classes as follows: ● the Class I directors are Michael Farello and Yehoshua (Shuki) Nir, and their terms expire at our annual general meeting of shareholders to be held in 2027; ● the Class II director is Shiran Holtzman-Erel, and her term expires at our annual meeting of shareholders to be held in 2025; and ● the Class III director is Oran Holtzman, and his term expires at our annual meeting of shareholders to be held in 2026.
Our directors who are not external directors are divided among the three classes as follows: ● the Class I directors are Michael Farello and Yehoshua (Shuki) Nir, and their terms expire at our annual general meeting of shareholders to be held in 2027; ● the Class II director is Shiran Holtzman-Erel, and her term expires at our annual meeting of shareholders to be held in 2028; and ● the Class III director is Oran Holtzman, and his term expires at our annual meeting of shareholders to be held in 2026.
Covered Executives The following is a summary of the salary expenses and social benefit costs of our five most highly compensated executive officers in 2024 (the “Covered Executives”). All amounts reported reflect the cost to the Company as recognized in our financial statements for the year ended December 31, 2024. ● Mr. Oran Holtzman, Co-Founder and Chief Executive Officer.
Covered Executives The following is a summary of the salary expenses and social benefit costs of our five most highly compensated executive officers in 2025 (the “Covered Executives”). All amounts reported reflect the cost to the Company as recognized in our financial statements for the year ended December 31, 2025. ● Mr. Oran Holtzman, Co-Founder and Chief Executive Officer.
For this purpose, a break of less than two years in his or her service as a director shall not be deemed to interrupt the continuity of the service. 101 Table of Contents Each of our audit committee members currently meets the requirements to be qualified as an unaffiliated director under the Companies Law, thereby fulfilling the foregoing Israeli law requirement for the composition of the audit committee.
For this purpose, a break of less than two years in his or her service as a director shall not be deemed to interrupt the continuity of the service. 102 Table of Contents Each of our audit committee members currently meets the requirements to be qualified as an unaffiliated director under the Companies Law, thereby fulfilling the foregoing Israeli law requirement for the composition of the audit committee.
We have not experienced any work stoppages, and we believe that our employee relations are strong. E. Share Ownership Ownership of our ordinary shares by our directors and executive officers is set forth in the section titled “Item 7.A. Major Shareholders and Related Party Transactions—Major Shareholders” of this Annual Report. 106 Table of Contents F.
We have not experienced any work stoppages, and we believe that our employee relations are strong. E. Share Ownership Ownership of our ordinary shares by our directors and executive officers is set forth in the section titled “Item 7.A. Major Shareholders and Related Party Transactions—Major Shareholders” of this Annual Report. 107 Table of Contents F.
We may, however, in the future decide to use the “foreign private issuer exemption” and opt out of some or all of the other corporate governance rules. 96 Table of Contents Board of Directors Under the Companies Law and our amended and restated articles of association, our business and affairs are managed under the direction of our board of directors.
We may, however, in the future decide to use the “foreign private issuer exemption” and opt out of some or all of the other corporate governance rules. 97 Table of Contents Board of Directors Under the Companies Law and our amended and restated articles of association, our business and affairs are managed under the direction of our board of directors.
For the purpose of determining the holding percentage stated above, two or more shareholders who have a personal interest in a transaction that is brought for the company’s approval are deemed as joint holders. 98 Table of Contents The initial term of an external director is three years.
For the purpose of determining the holding percentage stated above, two or more shareholders who have a personal interest in a transaction that is brought for the company’s approval are deemed as joint holders. 99 Table of Contents The initial term of an external director is three years.
Awards granted to Unapproved Israeli Participants are not subject to the trustee arrangement, and are instead subject to Section 3(i) or 2 of the Ordinance. 94 Table of Contents Trustee 102 Awards The grant of a Trustee 102 Award is subject to compliance with all terms and conditions of Section 102 of the Ordinance, including the execution of an undertaking.
Awards granted to Unapproved Israeli Participants are not subject to the trustee arrangement, and are instead subject to Section 3(i) or 2 of the Ordinance. 95 Table of Contents Trustee 102 Awards The grant of a Trustee 102 Award is subject to compliance with all terms and conditions of Section 102 of the Ordinance, including the execution of an undertaking.
To the extent required under applicable law, the actual annual bonus paid to our officers will be approved by our compensation committee and our board of directors. 87 Table of Contents The measurable performance objectives of our Chief Executive Officer will be set and evaluated annually by our compensation committee and board of directors.
To the extent required under applicable law, the actual annual bonus paid to our officers will be approved by our compensation committee and our board of directors. 88 Table of Contents The measurable performance objectives of our Chief Executive Officer will be set and evaluated annually by our compensation committee and board of directors.
The ESPP consists of two components: a Section 423 component and a non-Section 423 component. As of December 31, 2024, no offerings have been made under the ESPP. We do not intend to make any offerings under the ESPP at this time.
The ESPP consists of two components: a Section 423 component and a non-Section 423 component. As of December 31, 2025, no offerings have been made under the ESPP. We do not intend to make any offerings under the ESPP at this time.
Compensation expenses recorded in 2024 of $0.2 million in salary expenses and social benefits costs. ● Ms. Shiran Holtzman-Erel, Co-Founder and Chief Product Officer. Compensation expenses recorded in 2024 of $0.3 million in salary expenses and social benefits costs. ● Ms. Lindsay Drucker Mann, Global Chief Financial Officer.
Compensation expenses recorded in 2025 of $0.2 million in salary expenses and social benefits costs. ● Ms. Shiran Holtzman-Erel, Co-Founder and Chief Product Officer. Compensation expenses recorded in 2025 of $0.3 million in salary expenses and social benefits costs. ● Ms. Lindsay Drucker Mann, Global Chief Financial Officer.
He is also a director of Kornit Digital Ltd. and of Cardo Systems Ltd., and was formerly a director of ironSource Ltd. Mr. Nir has held strategic and leadership roles in various tech companies, and was also the co-founder and CEO of MindEcho, Inc. He holds an M.B.A, an L.L.B. and a B.A (Accounting) from the Tel Aviv University.
He was formerly a director of Kornit Digital Ltd. and of Cardo Systems Ltd., as well as ironSource Ltd. Mr. Nir has held strategic and leadership roles in various tech companies, and was also the co-founder and CEO of MindEcho, Inc. He holds an M.B.A, an L.L.B. and a B.A (Accounting) from the Tel Aviv University.
In the event of a change of control (as defined in the 2023 Plan), all outstanding equity awards held by such directors pursuant to this policy will accelerate and vest in full. 85 Table of Contents Compensation of Senior Management and Other Employees Compensation Policy Under the Companies Law In general, under the Companies Law, a public company must have a compensation policy approved by its board of directors after receiving and considering the recommendations of the compensation committee.
In the event of a change of control (as defined in the 2023 Incentive Award Plan), all outstanding equity awards held by such directors pursuant to this policy will accelerate and vest in full. 86 Table of Contents Compensation of Senior Management and Other Employees Compensation Policy Under the Companies Law In general, under the Companies Law, a public company must have a compensation policy approved by its board of directors after receiving and considering the recommendations of the compensation committee.
The 2020 Plan was replaced by the 2023 Plan on September 28, 2023, but awards outstanding as of that date will continue in full force and in accordance with the terms under which they were granted. 90 Table of Contents The below summary of the 2020 Plan material terms is qualified in its entirety by reference to the 2020 Plan, which is filed as an exhibit to this Annual Report.
The 2020 Plan was replaced by the 2023 Incentive Award Plan on September 28, 2023, but awards outstanding as of that date will continue in full force and in accordance with the terms under which they were granted. 91 Table of Contents The below summary of the 2020 Plan material terms is qualified in its entirety by reference to the 2020 Plan, which is filed as an exhibit to this Annual Report.
In connection with outstanding awards to our Covered Executives, we recorded equity-based compensation expenses in our financial statements for the year ended December 31, 2024 for Mr. Oran Holtzman, Ms. Shiran Holtzman-Erel, Ms. Lindsay Drucker Mann, Mr. Dmitri Kaplun and Mr. Niv Price of $2.7 million, $2.4 million, $2.0 million, $3.6 million and $0.6 million, respectively.
In connection with outstanding awards to our Covered Executives, we recorded equity-based compensation expenses in our financial statements for the year ended December 31, 2025 for Mr. Oran Holtzman, Ms. Shiran Holtzman-Erel, Ms. Lindsay Drucker Mann, Mr. Dmitri Kaplun and Mr. Niv Price of $3.0 million, $2.6 million, $2.0 million, $4.1 million and $1.3 million, respectively.
Family Relationships Oran Holtzman and Shiran Holtzman-Erel, our co-founders and Chief Executive Officer and Chief Product Officer, respectively, are siblings. 84 Table of Contents B.
Family Relationships Oran Holtzman and Shiran Holtzman-Erel, our co-founders and Chief Executive Officer and Chief Product Officer, respectively, are siblings. 85 Table of Contents B.
This amount includes deferred or contingent compensation accrued for such year (and excludes deferred or contingent amounts accrued for during the year ended December 31, 2023 and paid during the year ended December 31, 2024).
This amount includes deferred or contingent compensation accrued for such year (and excludes deferred or contingent amounts accrued for during the year ended December 31, 2024 and paid during the year ended December 31, 2025).
We did not have any amounts set aside or accrued to provide pension, severance, retirement or similar benefits or expenses to our directors and executive officers as of December 31, 2024. During the year ended December 31, 2024, our directors and executive officers were granted 361,233 restricted share units under our 2023 Incentive Award Plan.
We did not have any amounts set aside or accrued to provide pension, severance, retirement or similar benefits or expenses to our directors and executive officers as of December 31, 2025. During the year ended December 31, 2025, our directors and executive officers were granted 30,531 restricted share units under our 2023 Incentive Award Plan.
Compensation expenses recorded in 2024 of $0.2 million in salary expenses and social benefits costs.
Compensation expenses recorded in 2025 of $0.2 million in salary expenses and social benefits costs.
Prior to that, from December 2012 until December 2016, Ms. Payorski served as Senior Vice President, Corporate Finance at Stratasys Ltd. Ms. She previously held key finance management positions with PMC- Sierra Inc (NASDAQ: PMC), Checkpoint Software Technologies (NASDAQ:CHKP), WindRiver Systems (NASDAQ:WIND), and Ernst & Young. Payorski holds a B.A. in Accounting and Economics from Tel-Aviv University. Ms.
Payorski served as Senior Vice President, Corporate Finance at Stratasys Ltd. Ms. She previously held key finance management positions with PMC- Sierra Inc (NASDAQ: PMC), Checkpoint Software Technologies (NASDAQ:CHKP), WindRiver Systems (NASDAQ:WIND), and Ernst & Young. Payorski holds a B.A. in Accounting and Economics from Tel-Aviv University. Ms.
Aggregate Compensation of Executive Officers and Directors The aggregate compensation recorded by us and our subsidiaries to our directors and executive officers identified in the section titled “Item 6.A. Executive Officers and Directors,” including share-based compensation expenses recorded in our financial statements, for the year ended December 31, 2024, was approximately $16.2 million.
Aggregate Compensation of Executive Officers and Directors The aggregate compensation recorded by us and our subsidiaries to our directors and executive officers identified in the section titled “Item 6.A. Executive Officers and Directors,” including share-based compensation expenses recorded in our financial statements, for the year ended December 31, 2025, was approximately $17.8 million.
Employees As of December 31, 2024, we had a corporate workforce of 489 individuals across our organization, compared to 342 individuals and 271 individuals as of December 31, 2023 and 2022, respectively.
Employees As of December 31, 2025, we had a corporate workforce of 658 individuals across our organization, compared to 489 individuals and 342 individuals as of December 31, 2024 and 2023, respectively.
Payorski also completed the Board of Directors and Senior Corporate Officers Program at LAHAV, School of Management, Tel Aviv University. Ohad Chereshniya has served as a member of our board of directors since July 2023. Mr.
Payorski also completed the Board of Directors and Senior Corporate Officers Program at LAHAV, School of Management, Tel Aviv University. Ohad Chereshniya has served as a member of our board of directors since July 2023. Mr. Chereshniya is Chief Financial Officer of Cynomi Ltd.
Chereshniya served as our Chief Financial Officer. Mr. Chereshniya holds an M.B.A. and a B.A. in Accounting from Tel Aviv University. Yehoshua (Shuki) Nir has served as a member of our board of directors since July 2024. Mr. Nir is Chief Executive Officer of SolarEdge Technologies, Inc.
Prior to that, from June 2013 until May 2017, Mr. Chereshniya served as our Chief Financial Officer. Mr. Chereshniya holds an M.B.A. and a B.A. in Accounting from Tel Aviv University. Yehoshua (Shuki) Nir has served as a member of our board of directors since July 2024. Mr. Nir is Chief Executive Officer of SolarEdge Technologies, Inc.
Executive Officers and Directors Executive Officers and Directors The following table sets forth the name, age and position of each of our executive officers and members of our board of directors as of the date of this Annual Report: ​ ​ ​ ​ ​ Name Age Position Executive Officers Oran Holtzman 41 Co-Founder, Chief Executive Officer and Director Shiran Holtzman-Erel 37 Co-Founder, Chief Product Officer and Director Lindsay Drucker Mann 44 Global Chief Financial Officer Niv Price 51 Chief Technology Officer Non-Employee Directors ​ ​ Michael Farello 60 Director Lilach Payorski 51 Director Ohad Chereshniya 45 Director Yehoshua (Shuki) Nir 55 Director ​ 83 Table of Contents Executive Officers Oran Holtzman is our co-founder and has served as our Chief Executive Officer and as a member of our board of directors since our inception.
Executive Officers and Directors Executive Officers and Directors The following table sets forth the name, age and position of each of our executive officers and members of our board of directors as of the date of this Annual Report: ​ ​ ​ ​ ​ Name ​ ​ ​ Age ​ ​ ​ Position Executive Officers ​ ​ Oran Holtzman 42 Co-Founder, Chief Executive Officer and Director Shiran Holtzman-Erel 38 Co-Founder, Chief Product Officer and Director Lindsay Drucker Mann 45 Global Chief Financial Officer Niv Price 52 Chief Technology Officer Non-Employee Directors ​ ​ Michael Farello 61 Director Lilach Payorski 52 Director Ohad Chereshniya 47 Director Yehoshua (Shuki) Nir 56 Director ​ 84 Table of Contents Executive Officers Oran Holtzman is our co-founder and has served as our Chief Executive Officer and as a member of our board of directors since our inception.
Payorski currently serves as director and member of the audit and compensation committees of Kamada Ltd. and as director and member of the audit committee of Gauzy Ltd. Ms. Payorski also served as the chief financial officer of Stratasys Ltd., a developer and manufacturer of 3D printers and additive solutions, from January 2017 to February 2022.
Payorski currently serves as director and member of the audit and compensation committees of Kamada Ltd. Ms. Payorski also served as the chief financial officer of Stratasys Ltd., a developer and manufacturer of 3D printers and additive solutions, from January 2017 to February 2022. Prior to that, from December 2012 until December 2016, Ms.
The 2020 Plan enabled us to grant equity-based awards consisting of options to purchase our Class A ordinary shares, restricted shares and RSUs, all of which are referred to as “awards.” As of December 31, 2024, options to purchase 9,154,612 Class A ordinary shares were outstanding under the 2020 Plan.
The 2020 Plan enabled us to grant equity-based awards consisting of options to purchase our Class A ordinary shares, restricted shares and RSUs, all of which are referred to as “awards.” As of December 31, 2025, RSUs and options to purchase 7,631,345 Class A ordinary shares were outstanding under the 2020 Plan.
As of December 31, 2024, approximately 44% and 56% of this workforce was located in the United States and outside of the United States, respectively, compared to 41% and 59% and 40% and 60% as of December 31, 2023 and 2022, respectively.
As of December 31, 2025, approximately 47% and 53% of this workforce was located in the United States and outside of the United States, respectively, compared to 44% and 56% and 41% and 59% as of December 31, 2024 and 2023, respectively.
Chereshniya currently serves as director of the audit committee of Itim Ensemble, an Israeli non-profit organization, and was Chief Financial Officer at Elementor Ltd. from January 2020 through January 2025. Mr. Chereshniya served as the Chief Financial Officer of Context Based 4casting Ltd. from July 2017 to December 2019. Prior to that, from June 2013 until May 2017, Mr.
(as of September 2025) and also serves as director of the audit committee of Itim Ensemble, an Israeli non-profit organization. Mr. Chereshniya served as the Chief Financial Officer at Elementor Ltd. from January 2020 through January 2025. He served as the Chief Financial Officer of Context Based 4casting Ltd. from July 2017 to December 2019.
Compensation expenses recorded in 2024 of $0.7 million in salary expenses and social benefits costs. 89 Table of Contents ● Mr. Dmitri Kaplun, Chief Executive Officer, IL Makiage. Compensation expenses recorded in 2024 of $0.9 million in salary expenses and social benefits costs. ● Mr, Niv Price, Chief Technology Officer.
Compensation expenses recorded in 2025 of $0.8 million in salary expenses and social benefits costs. 90 Table of Contents ● Mr. Dmitri Kaplun, Chief Executive Officer, IL Makiage. Compensation expenses recorded in 2025 of $1.0 million in salary expenses and social benefits costs. ● Mr. Niv Price, Chief Technology Officer.
During the year ended December 31, 2024, we also recorded a one-time bonus expense in respect of Mr. Niv Price, of $2.0 million. Employment and Consulting Agreements with Executive Officers We have entered into written employment agreements with each of our executive officers.
During the year ended December 31, 2025, we also recorded a one-time bonus expense in respect of Ms. Lindsay Drucker Mann, of $1.0 million. Employment and Consulting Agreements with Executive Officers We have entered into written employment agreements with each of our executive officers.
The executive officers’ equity grants were subject to a vesting schedule between one and four years from the date of grant, with the PSUs also being subject to predetermined Company performance criteria set by our compensation committee and board of directors.
During 2025, we granted our directors and executive officers 30,531 RSUs under our 2023 Incentive Award Plan. The executive officers’ equity grants were subject to a vesting schedule of one year from the date of grant.
Removed
During 2024, we granted our directors and executive officers 361,233 RSUs and PSUs (restricted share units subject to certain performance conditions) under our 2023 Incentive Award Plan.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

27 edited+8 added−15 removed42 unchanged
Consists of Class A ordinary shares beneficially owned by LCGP3 Pro Makeup, L.P. CGP3 Managers, L.L.C. is the general partner of LCGP3 Pro Makeup, L.P. and the management of CGP3 Managers, L.L.C. is controlled by its managing members. Scott A. Dahnke and J.
Consists of Class A ordinary shares beneficially owned by LCGP3 Pro Makeup, L.P. (“LCGP3”). CGP3 Managers, L.L.C. is the general partner of LCGP3 and the management of CGP3 Managers, L.L.C. is controlled by its managing members. Scott A. Dahnke and J.
For purposes of the table below, we deem ordinary shares subject to options, RSUs, warrants or other rights that are currently exercisable or exercisable within 60 days of December 31, 2024 to be outstanding and to be beneficially owned by the person holding the options, RSUs, or warrants for the purposes of computing the ownership and percentage ownership of that person but we do not treat them as outstanding for the purpose of computing the percentage ownership of any other person.
For purposes of the table below, we deem ordinary shares subject to options, RSUs, warrants or other rights that are currently exercisable or exercisable within 60 days of December 31, 2025 to be outstanding and to be beneficially owned by the person holding the options, RSUs, or warrants for the purposes of computing the ownership and percentage ownership of that person but we do not treat them as outstanding for the purpose of computing the percentage ownership of any other person.
Unless otherwise noted below, each shareholder’s address is 110 Greene Street, New York, New York 10012. 107 Table of Contents A description of any material relationship that our principal shareholders have had with us or any of our affiliates within the past three years is included in the section titled “Item 7.B.
Unless otherwise noted below, each shareholder’s address is 110 Greene Street, New York, New York 10012. 108 Table of Contents A description of any material relationship that our principal shareholders have had with us or any of our affiliates within the past three years is included in the section titled “Item 7.B.
Directors, Senior Management and Employees—Compensation—Compensation of Directors.” Shareholder Duties Pursuant to the Companies Law, a shareholder has a duty to act in good faith and in a customary manner toward the company and other shareholders and to refrain from abusing his or her power with respect to the company, including, among other things, in voting at a general meeting and at shareholder class meetings with respect to the following matters: ● an amendment to the company’s articles of association; ● an increase of the company’s authorized share capital; ● a merger; or ● interested party transactions that require shareholder approval.
Directors, Senior Management and Employees—Compensation—Compensation of Directors.” Shareholder Duties Pursuant to the Companies Law, a shareholder has a duty to act in good faith and in a customary manner toward the company and other shareholders and to refrain from abusing his or her power with respect to the company, including, among other things, in voting at a general meeting and at shareholder class meetings with respect to the following matters: ● an amendment to the company’s articles of association; 111 Table of Contents ● an increase of the company’s authorized share capital; ● a merger; or ● interested party transactions that require shareholder approval.
The duty of loyalty requires that an office holder act in good faith and in the best interests of the company and includes, among other things, the duty to: ● refrain from any act involving a conflict of interest between the performance of his, her or its duties in the company and his, her or its other duties or personal affairs; ● refrain from any activity that is competitive with the business of the company; ● refrain from exploiting any business opportunity of the company for the purpose of gaining a personal advantage for himself, herself, or itself or others; and ● disclose to the company any information or documents relating to the company’s affairs which the office holder received as a result of his, her, or its position as an office holder.
The duty of loyalty requires that an office holder act in good faith and in the best interests of the company and includes, among other things, the duty to: ● refrain from any act involving a conflict of interest between the performance of his, her or its duties in the company and his, her or its other duties or personal affairs; ● refrain from any activity that is competitive with the business of the company; ● refrain from exploiting any business opportunity of the company for the purpose of gaining a personal advantage for himself, herself, or itself or others; and 110 Table of Contents ● disclose to the company any information or documents relating to the company’s affairs which the office holder received as a result of his, her, or its position as an office holder.
(“LCGP3”) On November 12, 2024, we entered into an agreement for the repurchase of certain of its Class A ordinary shares owned by LCGP3 for a total consideration of approximately $100 million (the “Share Repurchase”).
Repurchase Agreement with LCGP3 On November 12, 2024, we entered into an agreement for the repurchase of certain of its Class A ordinary shares owned by LCGP3 for a total consideration of approximately $100 million (the “Share Repurchase”).
Directors, Senior Management and Employees—Compensation—Aggregate Compensation of Executive Officers and Directors,” “Item 6.B. Directors, Senior Management and Employees—Compensation—Compensation of Senior Management and Other Employees—Compensation Policy Under the Companies Law” and “Item 6.B. Directors, Senior Management and Employees—Compensation—Share Option Plans” for more information on such awards.
See the sections titled “Item 6.B. Directors, Senior Management and Employees—Compensation—Aggregate Compensation of Executive Officers and Directors,” “Item 6.B. Directors, Senior Management and Employees—Compensation—Compensation of Senior Management and Other Employees—Compensation Policy Under the Companies Law” and “Item 6.B. Directors, Senior Management and Employees—Compensation—Share Option Plans” for more information on such awards.
In addition, a shareholder has a general duty to refrain from discriminating against other shareholders. 110 Table of Contents Certain shareholders also have a duty of fairness toward the company.
In addition, a shareholder has a general duty to refrain from discriminating against other shareholders. Certain shareholders also have a duty of fairness toward the company.
Directors, Senior Management and Employees—Board Practices—Exculpation, Insurance, and Indemnification of Office Holders” for more information. C. Interests of Experts and Counsel Not applicable. 113 Table of Contents
Directors, Senior Management and Employees—Board Practices—Exculpation, Insurance, and Indemnification of Office Holders” for more information. C. Interests of Experts and Counsel Not applicable.
Major Shareholders The following table sets forth information with respect to the beneficial ownership of our ordinary shares as of December 31, 2024 by each person or group of affiliated persons known by us to own beneficially more than 5% of our outstanding ordinary shares, each of our executive officers and directors individually and all of our executive officers and directors as a group.
Major Shareholders The following table sets forth information with respect to the beneficial ownership of our ordinary shares as of March 6, 2026 by each person or group of affiliated persons known by us to own beneficially more than 5% of our outstanding ordinary shares, each of our executive officers and directors individually and all of our executive officers and directors as a group.
This agreement terminated in connection with the closing of our initial public offering. 111 Table of Contents Registration Rights On June 2, 2017, we entered into a registration rights agreement with Oran Shilo Investments LP and Il Makiage Investments L.P., each of which is controlled by Oran Holtzman, our founder and Chief Executive Officer, and LCGP3 (together, the “RRA Investors”).
Registration Rights On June 2, 2017, we entered into a registration rights agreement with Oran Shilo Investments LP and Il Makiage Investments L.P., each of which is controlled by Oran Holtzman, our co-founder and Chief Executive Officer, and LCGP3 (together, the “RRA Investors”).
However, our U.S. holders of record include CEDE & CO., a nominee of The Depository Trust Company, which held 31,570,415 of our Class A ordinary shares as of December 31, 2024, and Equiniti Trust Company, LLC (f/k/a American Stock Transfer & Trust Company), which held 16,594 of our Class A ordinary shares pursuant to escrow arrangements related to the Revela Merger Agreement as of December 31, 2024.
However, our U.S. holders of record include CEDE & CO., a nominee of The Depository Trust Company, which held 39,563,626 of our Class A ordinary shares as of December 31, 2025, and Equiniti Trust Company, LLC, which held 16,594 of our Class A ordinary shares pursuant to escrow arrangements related to the Revela Merger Agreement as of December 31, 2025.
Rights of Appointment We are not a party to, and are not aware of, any voting agreements among our shareholders which are currently in effect. Repurchase Agreement with LCGP3 Pro Makeup, L.P.
Rights of Appointment We are not a party to, and are not aware of, any voting agreements among our shareholders which are currently in effect.
Any such approval is subject to the terms of the Companies Law setting forth, among other things, the appropriate bodies of the company required to provide such approval and the methods of obtaining such approval. 109 Table of Contents Disclosure of Personal Interests of an Office Holder and Approval of Certain Transactions The Companies Law requires that an office holder promptly disclose to the board of directors any personal interest that such office holder may have and all related material information known to such office holder concerning any existing or proposed transaction with the company.
Disclosure of Personal Interests of an Office Holder and Approval of Certain Transactions The Companies Law requires that an office holder promptly disclose to the board of directors any personal interest that such office holder may have and all related material information known to such office holder concerning any existing or proposed transaction with the company.
Consists of 6,852,450 Class A ordinary shares and 11,547,000 Class B ordinary shares beneficially owned by Oran Shilo Investments LP (“Shilo”). Shilo is controlled by Oran Holtzman, our founder and Chief Executive Officer, and Mr.
Consists of 1,352,450 Class A ordinary shares and 11,547,000 Class B ordinary shares held by Oran Shilo Investments LP (“Shilo”) and Oran Holtzman Ltd. (“Ltd.”), all of which are beneficially owned by Oran Holtzman, our co-founder and Chief Executive Officer. Shilo and Ltd. are controlled by Mr. Holtzman, and Mr.
See the section titled “Description of Share Capital and Articles of Association—Amended and Restated Articles of Association—Voting.” As of December 31, 2024, we had 29 holders of record of our Class A ordinary shares in the United States, holding, in the aggregate 37,299,661, or 84.2%, of our outstanding Class A ordinary shares.
See the section titled “Description of Share Capital and Articles of Association—Amended and Restated Articles of Association—Voting.” As of December 31, 2025, we had 24 holders of record of our Class A ordinary shares in the U.S., holding, in the aggregate 44,589,045, or 96.9%, of our outstanding Class A ordinary shares.
Michael Chu are the managing members of CGP3 Managers, L.L.C. and as such may be deemed to share voting control and investment power over such shares that are held by CGP3 Managers, L.L.C. The address of LCGP3 Pro Makeup, L.P. is 599 W.
Michael Chu are the managing members of CGP3 Managers, L.L.C. and as such may be deemed to share voting control and investment power over such shares that are held by CGP3 Managers, L.L.C. The address of LCGP3 is 599 W. Putnam Avenue, Greenwich, CT 06830. 2) Based on a Schedule 13G filing made on February 10, 2026.
As of December 31, 2024, there were 10,889,922 Class A ordinary shares and 11,547,000 Class B ordinary shares subject to the registration rights agreement. Our registration rights agreement entitles the RRA Investors to certain registration rights, as set forth below. Form F-1 Demand Rights Any RRA Investor may request that we register all or a portion of their shares.
Our registration rights agreement entitles the RRA Investors to certain registration rights, as set forth below. 112 Table of Contents Form F-1 Demand Rights Any RRA Investor may request that we register all or a portion of their shares.
Major Shareholders and Related Party Transactions—Related Party Transactions.” ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Shares Beneficially Owned ​ ​ Class A ​ ​ ​ Class B ​ ​ ​ ​ ​ ​ Ordinary ​ ​ ​ Ordinary ​ ​ ​ % of Voting ​ Shares % Shares % Power Name of Beneficial Owner ​ Principal Shareholders ​ L Catterton (1) 4,037,472 9.1 % — — 2.5 % Baillie Gifford & Co (2) 5,969,581 13.5 % — — 3.7 % FMR LLC (3) ​ 3,877,635 ​ 8.8 % — ​ — ​ 2.4 % Directors and Executive Officers ​ ​ Oran Holtzman (4) 6,852,450 15.5 % 11,547,000 100 % 76.2 % Shiran Holtzman-Erel — — ​ — — — ​ Lindsay Drucker Mann (5) 756,735 1.7 % — — * ​ Shuki Nir — — — — — ​ Niv Price (6) 72,936 * — — * ​ Michael Farello (7) 57,143 * — — * ​ Lilach Payorski (8) 5,912 * — — * ​ Ohad Chereshniya (9) 2,956 * — — * ​ All executive officers and directors as a group (8 persons) 7,748,132 17.5 % 11,547,000 100 % 76.8 % * Indicates holdings of less than 1% 1) Based on a Schedule 13G filing made on November 18, 2024.
Major Shareholders and Related Party Transactions—Related Party Transactions.” ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Shares Beneficially Owned ​ ​ Class A ​ ​ ​ Class B ​ ​ ​ ​ ​ ​ Ordinary ​ ​ ​ Ordinary ​ ​ ​ % of Voting ​ ​ ​ ​ Shares ​ ​ ​ % ​ ​ ​ Shares ​ ​ ​ % ​ ​ ​ Power Name of Beneficial Owner ​ ​ ​ ​ ​ ​ Principal Shareholders ​ ​ ​ ​ ​ ​ L Catterton (1) 3,537,472 7.8 % — — 2.2 % Baillie Gifford & Co (2) 7,122,641 15.8 % — — 4.4 % FMR LLC (3) ​ 3,090,460 ​ 6.9 % — ​ — ​ 1.9 % Morgan Stanley (4) ​ 4,692,531 ​ 10.4 % — ​ — ​ 2.9 % Directors and Executive Officers ​ ​ ​ ​ ​ ​ Oran Holtzman (5) 2,209,534 4.9 % 11,547,000 100 % 73.3 % Shiran Holtzman-Erel — — ​ — — — ​ Lindsay Drucker Mann (6) 732,107 1.6 % — — * ​ Shuki Nir (7) 4,049 * — — * ​ Niv Price (8) 29,599 * — — * ​ Michael Farello (9) 57,143 * — — * ​ Lilach Payorski (10) 10,917 * — — * ​ Ohad Chereshniya (11) 9,961 * — — * ​ All executive officers and directors as a group (8 persons) 3,053,310 6.7 % 11,547,000 ​ 100 % 73.8 % * Indicates holdings or voting of less than 1%, as applicable. 1) Based on a Schedule 13G filing made on September 5, 2025.
Awards We grant annual and other cash bonuses to our employees and certain members of senior management, as well as options to purchase our ordinary shares to our employees and RSUs to certain members of senior management and the board of directors. See the sections titled “Item 6.B.
The enforceability of covenants not to compete is subject to limitations. 113 Table of Contents Awards We grant annual and other cash bonuses to our employees and certain members of senior management, as well as options to purchase our ordinary shares to our employees and RSUs to certain members of senior management and the board of directors.
The percentage of outstanding ordinary shares is computed on the basis of 44,281,291 Class A ordinary shares and 11,547,000 Class B ordinary shares outstanding as of December 31, 2024.
The percentage of outstanding ordinary shares is computed on the basis of 45,109,685 Class A ordinary shares and 11,547,000 Class B ordinary shares outstanding as of March 4, 2026.
The address of Baillie Gifford & Co is Calton Square, 1 Greenside Row, Edinburgh EH1 3AN, Scotland, U.K. 3) Based on information reported by FMR LLC on Form 13F-HR filed with the SEC on February 13, 2025. Consists of Class A ordinary shares beneficially owned by Fidelity Management & Research Co.
Consists of Class A ordinary shares beneficially owned by Baillie Gifford & Co. The address of Baillie Gifford & Co is Calton Square, 1 Greenside Row, Edinburgh EH1 3AN, Scotland, U.K. 3) Based on a Schedule 13G filing made on February 5, 2026.
In connection with our initial public offering, the Company issued and sold 1,754,385 Class A ordinary shares, LCGP3 sold 5,068,969 Class A ordinary shares and Oran Holtzman sold 7,097,696 Class A ordinary shares. 108 Table of Contents During 2024, LCGP3 sold via (i) an underwritten secondary offering, (ii) a repurchase by the Company, and (iii) a brokered private sale a total of 9,102,885 Class A ordinary shares, reducing its holdings to 4,037,472 Class A ordinary shares.
During 2024 and 2025, LCGP3 sold via (i) an underwritten secondary offering, (ii) a repurchase by the Company, and (iii) multiple brokered private sales a total of 9,602,885 Class A ordinary shares, reducing its holdings to 3,537,472 Class A ordinary shares.
Holtzman has voting control and investment power over our shares that are held by Shilo. 5) Consists of 34,729 Class A ordinary shares and 722,006 underlying options exercisable within 60 days of December 31, 2024. 6) Consists of 72,936 Class A ordinary shares. 7) Consists of 57,143 Class A ordinary shares. 8) Consists of 5,912 Class A ordinary shares. 9) Consists of 2,956 Class A ordinary shares.
Holtzman has voting control and investment power over our shares that are held by Shilo and Ltd. 6) Consists of 34,729 Class A ordinary shares and 697,378 Class A ordinary shares underlying options exercisable within 60 days of December 31, 2025. 7) Consists of 4,049 Class A ordinary shares. 8) Consists of 29,599 Class A ordinary shares. 9) Consists of 57,143 Class A ordinary shares. 10) Consists of 10,917 Class A ordinary shares. 11) Consists of 9,961 Class A ordinary shares. 109 Table of Contents Significant Changes in Ownership Our initial public offering on Nasdaq occurred on July 19, 2023.
Pursuant to this side letter, LCGP3 is provided with the unilateral right to initiate a merger of Cosmofill with us at no cost to us, and Cosmofill is obligated to bear sole responsibility for all costs or expenses associated with such merger. 112 Table of Contents Agreements with Niv Price Stock Purchase Agreement On July 9, 2021, we entered into a stock purchase agreement with the shareholders of Voyage81, including Niv Price, now our Chief Technology Officer, whereby we acquired all the shares of Voyage81 from such shareholders.
Pursuant to this side letter, LCGP3 is provided with the unilateral right to initiate a merger of Cosmofill with us at no cost to us, and Cosmofill is obligated to bear sole responsibility for all costs or expenses associated with such merger. As of the date of this Annual Report, Cosmofill is undergoing liquidation.
The first of such installment payments was made to Mr. Price on July 26, 2023, and the second installment payment was made to Mr. Price on July 26, 2024. Agreements with Directors and Officers Employment Agreements We have entered into at-will employment agreements with each of our executive officers who works for us as an employee.
Agreements with Directors and Officers Employment Agreements We have entered into at-will employment agreements with each of our executive officers who works for us as an employee. These agreements each contain provisions regarding non-competition, confidentiality of information, and assignment of inventions.
LLC, Fidelity Management Trust Co., Strategic Advisers LLC, Fidelity Institutional Asset Management Trust Co. and FIAM LLC. The address of FMR LLC is 245 Summer Street, Boston, MA 02210. 4) Based on a Schedule 13G filing made on February 12, 2024.
Accordingly, through their ownership of voting common shares and the execution of the shareholders’ voting agreement, members of the Johnson family may be deemed to form a controlling group with respect to FMR LLC. The address of FMR LLC is 245 Summer Street, Boston, MA 02210. 4) Based on a Schedule 13G filing made on March 6, 2026.
Removed
Putnam Avenue, Greenwich, CT 06830. 2) Based on information reported by Baillie Gifford & Co on Form 13F-HR filed with the SEC on January 31, 2025. Consists of Class A ordinary shares beneficially owned by Baillie Gifford & Co., Baillie Gifford Overseas LTD and Baillie Gifford Investment Management (Europe) Ltd.
Added
Consists of Class A ordinary shares beneficially owned by Fidelity Management & Research Company LLC, Fidelity Management Trust Company, and Strategic Advisers LLC. Members of the Johnson family, including Abigail P. Johnson, are the predominant owners, directly or through trusts, of Series B voting common shares of FMR LLC, representing 49% of the voting power of FMR LLC.
Removed
Significant Changes in Ownership Our initial public offering on Nasdaq occurred on July 19, 2023.
Added
The Johnson family group and all other Series B shareholders have entered into a shareholders’ voting agreement under which all Series B voting common shares will be voted in accordance with the majority vote of Series B voting common shares.
Removed
According to Schedule 13G filings made with the SEC on November 4, 2024 and November 12, 2024, Baillie Gifford & Co and FMR LLC each respectively beneficially own greater than 5% of our Class A ordinary shares.
Added
Consists of Class A ordinary shares beneficially owned by Morgan Stanley and Morgan Stanley Investment Management Inc. The address of Morgan Stanley is 1585 Broadway, New York, NY 10036. 5) Based on a Schedule 13G filing made on March 5, 2026.
Removed
Each of LCGP3 and L Catterton Growth Partners III Offshore, L.P. indemnified us and Michael Farello in connection with any stock awards granted by us and held by Michael Farello as nominee for Catterton Management. Indemnification and Expense Agreement with Catterton Management Company, L.L.C.
Added
In connection with our initial public offering, the Company issued and sold 1,754,385 Class A ordinary shares, LCGP3 sold 5,068,969 Class A ordinary shares and Oran Holtzman sold 7,097,696 Class A ordinary shares.
Removed
On June 2, 2017, we entered into an Indemnification and Expense Agreement with Catterton Management, pursuant to an investment in our ordinary shares on such date by LCGP3 Pro Makeup, L.P. (“LCGP3”), an entity affiliated with Catterton Management.
Added
During 2025 and 2026, Oran Holtzman, our co-founder and Chief Executive Officer, (i) sold 5,500,000 Class A ordinary shares held by Shilo via a brokered private sale and (ii) purchased 857,084 shares now held by Ltd. via open market purchases, reducing his holdings to 2,209,534 Class A ordinary shares and 11,547,000 Class B ordinary shares.
Removed
Under the Indemnification and Expense Agreement, we undertook to pay all reasonable expenses incurred by or on behalf of Catterton Management or its affiliates in connection with any services provided to us by Catterton Management or its affiliates.
Added
Any such approval is subject to the terms of the Companies Law setting forth, among other things, the appropriate bodies of the company required to provide such approval and the methods of obtaining such approval.
Removed
We also undertook to provide certain indemnity protections to Catterton Management and others affiliated with Catterton Management against any and all claims, legal actions, liabilities or expenses incurred by them arising out of or relating to any claims made against LCGP3 as a result of being one of our shareholders or relating to operations of or services provided by Catterton Management or its affiliates to us, all subject to certain conditions provided in the agreement.
Added
Catterton Management agreed to indemnify us and Michael Farello for all tax liabilities that may be incurred by us or Mr. Farello with respect to any cash fees or equity awards received in respect of Mr. Farello’s position as a member of the Company’s board of directors.
Removed
The indemnification obligations pursuant to this agreement are uncapped. No services were rendered and we did not pay Catterton Management any amounts under the Indemnification and Expense Agreement for the years ended December 31, 2024, 2023 and 2022, respectively.
Added
Based on Schedule 13G filings, there are 5,747,006 Class A ordinary shares and 11,547,000 Class B ordinary shares subject to the registration rights agreement.
Removed
In connection with the acquisition of Voyage81, we paid Mr. Price an aggregate of $3.3 million in exchange for his shares of Voyage81. Holdback Agreement On July 9, 2021, we entered into a holdback agreement (the “Holdback Agreement”), with Mr. Price as a condition for the consummation of the acquisition of Voyage81.
Removed
Pursuant to the Holdback Agreement, we withheld from Mr.
Removed
Price a portion of the consideration due to him on account of the sale of his holdings in Voyage81 and agreed to pay him such deferred consideration in two equal installments of $0.8 million on each of the second and third anniversary dates of the closing of the acquisition of shares under the stock purchase agreement.
Removed
These agreements each contain provisions regarding non-competition, confidentiality of information, and assignment of inventions. The enforceability of covenants not to compete is subject to limitations.
Removed
Incentive Plan with Respect to SpoiledChild On October 4, 2020, we provided each of Oran Holtzman, our co-founder and Chief Executive Officer, and Shiran Holtzman-Erel, our co-founder and Chief Product Officer, with an incentive plan in connection with revenue earned from our SpoiledChild brand.
Removed
During the years ended December 31, 2023 and 2022, we recognized expenses of $17.4 million and $12.6 million under this plan, respectively. No further amounts are payable thereunder. See the section titled “Item 6.B.
Removed
Directors, Senior Management and Employees—Compensation—Aggregate Compensation of Executive Officers and Directors” for more information and the section titled “Management—Incentive Plan with Respect to SpoiledChild” in our final prospectus filed with the SEC pursuant to Rule 424(b)(4) on July 20, 2023, which is hereby incorporated by reference into this Annual Report.

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