European Wax Center, Inc. Reports Fourth Quarter and Fiscal Year 2025 Results
Rhea-AI Summary
European Wax Center (NASDAQ: EWCZ) reported fiscal 2025 results: 1,047 centers, system-wide sales of $947.3M (-0.4%), total revenue of $206.6M (-4.7%), GAAP net income of $11.9M (-19.2%) and Adjusted EBITDA of $73.3M (-3.0%).
The company repurchased ~1.4M shares for $5.7M, ended the year with $76.1M cash and $386.0M debt, and agreed to be taken private by General Atlantic.
Positive
- $45.9M cumulative share repurchases under $50M authorization
Negative
- GAAP net income down 19.2% to $11.9M
- Adjusted Net Income down 11.6% to $36.2M
- Quarterly net loss of $1.5M versus prior net income
- SG&A margin increased 450 basis points in the quarter
- Outstanding borrowings of $386.0M under senior secured notes
News Market Reaction – EWCZ
On the day this news was published, EWCZ declined 0.17%, reflecting a mild negative market reaction.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Market Reality Check
Peers on Argus
EWCZ was up 0.35% with below-average volume while peers showed mixed moves: SKIN +2.86%, DSY +1.66%, WALD -1.25%, ACU -2.18%, GROV -3.57%. No sector-wide pattern emerged.
Previous Earnings Reports
| Date | Event | Sentiment | Move | Catalyst |
|---|---|---|---|---|
| Nov 12 | Q3 2025 earnings | Positive | +14.0% | Q3 2025 earnings with net income and Adjusted EBITDA growth despite softer sales. |
| Aug 13 | Q2 2025 earnings | Neutral | +13.8% | Q2 2025 mixed results and reduced full-year outlook with modest same-store growth. |
| May 14 | Q1 2025 earnings | Positive | +21.5% | Q1 2025 earnings showing system-wide growth and higher Adjusted EBITDA despite revenue dip. |
| Mar 11 | FY 2024 earnings | Neutral | -12.9% | FY 2024 mixed results and outlook for a transitional 2025 with net closures. |
| Nov 14 | Q3 2024 earnings | Negative | -23.2% | Q3 2024 earnings with declining revenue, earnings, and same-store sales. |
Earnings releases have often triggered sizable single-day moves, with mostly positive reactions in 2025 despite mixed fundamentals.
Over the past five earnings cycles, European Wax Center reported largely flat-to-declining system-wide sales and revenue, while maintaining modest same-store sales growth and focusing on center optimization. Q1–Q3 FY2025 results showed mixed fundamentals but drove strong positive price reactions of up to 21.46%. FY2024 results and Q3 2024 prompted double-digit declines. Today’s FY2025 release continues themes of slight sales pressure, margin management, and active capital returns via buybacks.
Historical Comparison
Across the last 5 earnings releases, average one-day moves were about 2.64%, with both sharp rallies and selloffs, framing how investors may contextualize the latest FY2025 results.
Earnings updates from late 2024 through FY2025 trace a shift from modest network expansion to planned net closures, slight system-wide sales declines, and a focus on maintaining Adjusted EBITDA. Guidance narrowed to system-wide sales of $940–950M and more closures, and FY2025 results now confirm lower revenue, softer net income, but relatively stable Adjusted EBITDA against a shrinking center base.
Market Pulse Summary
This announcement details FY2025 performance with system-wide sales of $947.3M, revenue down 4.7% to $206.6M, and net income of $11.9M alongside stable Adjusted EBITDA of $73.3M. Same-store sales were slightly positive, but the center count declined and Q4 swung to a net loss. The already-announced all-cash take-private at $5.80 per share and significant buybacks frame how investors may weigh ongoing fundamentals against transaction terms.
Key Terms
adjusted ebitda financial
adjusted net income financial
ebitda financial
net leverage ratio financial
non-gaap financial measures financial
tax receivable agreement financial
restricted stock units financial
form 8-k regulatory
AI-generated analysis. Not financial advice.
Fiscal Year 2025 versus 2024
- 1,047 total centers in 44 states, a
1.9% decrease versus 1,067 centers in the prior year period. - System-wide sales of
$947.3 million decreased0.4% - Total revenue of
$206.6 million decreased4.7% - Same-store sales increased
0.2% - GAAP net income of
$11.9 million decreased19.2% - Adjusted Net Income of
$36.2 million decreased11.6% - Adjusted EBITDA of
$73.3 million decreased3.0%
PLANO, Texas, March 04, 2026 (GLOBE NEWSWIRE) -- Today, European Wax Center, Inc. (NASDAQ: EWCZ), the leading franchisor and operator of out-of-home waxing services in the United States, reports financial results for the 13 and 52 weeks ended January 3, 2026.
Results for the Fourth Quarter of Fiscal 2025 versus Fiscal 2024
- Franchisees opened 1 and closed 7 centers. We ended the quarter with 1,047 centers, representing a
1.9% decrease versus 1,067 centers in the prior year period. - System-wide sales of
$225.6 million decreased1.6% from$229.3 million in the prior year period, primarily driven by a shift in service mix. - Total revenue of
$45.1 million decreased9.3% from$49.7 million in the prior year period. - Same-store sales decreased
0.1% . - Selling, general and administrative expenses (“SG&A”) of
$15.5 million increased4.3% from$14.8 million in the prior year period. SG&A as a percent of total revenue increased 450 basis points to34.3% from29.8% primarily driven by strategic investments in headcount to support long-term growth initiatives and lower revenue primarily resulting from one-time support investments to franchisees. - Interest expense, net of
$6.6 million increased from$6.4 million in the prior year period. - Income tax benefit decreased to
$0.7 million from$1.6 million in the prior year period primarily due to an increase in state and local taxes, partially offset by the pretax loss in the current period. - Net loss of
$1.5 million decreased147.5% from net income of$3.1 million , and Adjusted Net Income of$4.2 million decreased64.4% from$11.9 million in the prior year period. Net loss margin decreased 940 basis points to3.2% from net income margin of6.2% . - Adjusted EBITDA of
$12.7 million decreased33.1% from$19.0 million in the prior year period. Adjusted EBITDA Margin decreased 1,000 basis points to28.1% from38.1% .
Annual Results for Fiscal 2025 versus Fiscal 2024
- Franchisees opened 11 and closed 31 centers in fiscal 2025.
- System-wide sales of
$947.3 million decreased0.4% from$951.0 million compared to the prior year. - Total revenue of
$206.6 million decreased4.7% from$216.9 million in the prior year. - Same-store sales increased
0.2% . - Selling, general and administrative expenses (“SG&A”) of
$58.4 million decreased0.6% from$58.7 million in the prior year. SG&A as a percent of total revenue increased 110 basis points to28.2% from27.1% primarily driven by lower revenue, as SG&A expenses were generally consistent year-over-year. - Interest expense, net of
$26.3 million increased from$25.5 million in the prior year. - Income tax expense increased to
$4.7 million from$2.2 million in the prior year. The effective tax rate increased to28.5% from13.0% in the prior year-to-date period, primarily due to an increase related to our investment in EWC Ventures LLC, an increase related to state and local taxes, partially offset by decreases related to equity-based compensation. - Net income of
$11.9 million decreased19.2% from$14.7 million , and Adjusted Net Income of$36.2 million decreased11.6% from$40.9 million in the prior year. Net income margin decreased 110 basis points to5.7% from6.8% . - Adjusted EBITDA of
$73.3 million decreased3.0% from$75.5 million in the prior year. Adjusted EBITDA Margin increased 70 basis points to35.5% from34.8% . - The Company repurchased approximately 1.4 million shares of its Class A Common Stock during the period for
$5.7 million , bringing cumulative repurchases under the Company’s current$50 million authorization to$45.9 million .
Balance Sheet and Cash Flow
The Company ended the year with
2026 Outlook and Conference Call Update
On February 10, 2026, European Wax Center, Inc. announced that it entered into a definitive agreement to be taken private by General Atlantic, a leading global investor, in an all-cash transaction. Upon completion of the transaction, European Wax Center’s class A common stock will no longer be publicly listed, and European Wax Center will become a privately held company. In light of the transaction, European Wax Center will not host a conference call or provide financial guidance for fiscal year 2026 in conjunction with this quarter’s report. For further detail concerning the Proposed Transaction, please refer to our Current Report on Form 8-K filed with the SEC on February 10, 2026. For further detail and discussion of our financial performance, please refer to our Annual Report on Form 10-K for the fiscal year 2025 ended January 3, 2026 upon its filing with the SEC.
About European Wax Center, Inc.
European Wax Center, Inc. (NASDAQ: EWCZ) is the leading franchisor and operator of out-of-home waxing services in the United States. European Wax Center locations perform approximately 23 million services per year, providing guests with an unparalleled, professional personal care experience administered by highly trained wax specialists within the privacy of clean, individual waxing suites. The Company continues to revolutionize the waxing industry with its innovative Comfort Wax® formulated with the highest quality ingredients to make waxing a more efficient and relatively painless experience, along with its collection of proprietary products to help enhance and extend waxing results. By leading with its values – We Care About Each Other, We Do the Right Thing, We Delight Our Guests, and We Have Fun While Being Awesome – the Company is proud to be Certified™ by Great Place to Work®. European Wax Center, Inc. was founded in 2004 and is headquartered in Plano, Texas. Its network, which includes more than 1,000 centers in 44 states, generated sales of
Forward-Looking Statements
This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements in this press release include but are not limited to European Wax Center, Inc.’s strategy, outlook and growth prospects, its operational and financial outlook for fiscal 2025, expected center openings and closures, its capital allocation strategy, including the share repurchase program and its long-term targets and algorithm, including but not limited to statements under the headings “Fiscal 2025 Financial Outlook” and “Fiscal 2025 Net New Center Outlook” and statements by European Wax Center’s chief executive officer. Words including “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “likely,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “will,” or “would,” or, in each case, the negative thereof or other variations thereon or comparable terminology are intended to identify forward-looking statements. In addition, any statements or information that refer to expectations, beliefs, plans, projections, objectives, performance or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking.
These forward-looking statements are based on current expectations and beliefs. These statements are neither promises nor guarantees, and involve known and unknown risks, uncertainties and other important factors that may cause the Company’s actual results, performance or achievements to be materially different than the results, performance or achievements expressed or implied by the forward-looking statements. Some of the key factors that could cause actual results to differ from the Company's expectations include, but are not limited to, the following risks related to its business: the operational and financial results of franchisees; the ability of its franchisees to enter new markets, select appropriate sites for new centers or open new centers; the effectiveness of the Company’s marketing and advertising programs and the active participation of franchisees in enhancing the value of its brand; the failure of its franchisees to participate in and comply with its agreements, business model and policies; the Company’s and its franchisees’ ability to attract and retain guests; the effect of social media on the Company’s reputation; the Company’s ability to compete with other industry participants and respond to market trends and changes in consumer preferences; the effect of the Company’s planned growth on its management, employees, information systems and internal controls; the Company’s ability to retain and effectively respond to a loss of key executives; recruitment efforts; a significant failure, interruptions or security breach of the Company’s computer systems or information technology; the Company and its franchisees’ ability to attract, train, and retain talented wax specialists and managers; changes in the availability or cost of labor; the Company’s ability to retain its franchisees and to maintain the quality of existing franchisees; failure of the Company’s franchisees to implement business development plans; the ability of the Company’s limited key suppliers, including international suppliers, and distribution centers to deliver their products; changes in supply costs and decreases in the Company’s product sourcing revenue, including due to the imposition of tariffs; the Company’s ability to adequately protect its intellectual property; the Company’s substantial indebtedness; the impact of paying some of the Company’s pre-IPO owners for certain tax benefits the Company may claim; changes in general economic and business conditions, including changes due to tariff policy and geopolitical tensions; the Company’s and its franchisees’ ability to comply with existing and future health, employment and other governmental regulations; complaints or litigation that may adversely affect the Company’s business and reputation; the seasonality of the Company’s business resulting in fluctuations in its results of operations; the impact of global crises on the Company’s operations and financial performance; the impact of inflation and rising interest rates on the Company’s business; the Company’s access to sources of liquidity and capital to finance its continued operations and growth strategy and the other important factors discussed under the caption “Risk Factors” under Item 1A in the Company’s Annual Report on Form 10-K for the year ended January 4, 2025 filed with the Securities and Exchange Commission (the “SEC”), as such factors may be updated from time to time in its other filings with the SEC, accessible on the SEC’s website at www.sec.gov and Investors Relations section of the Company’s website at www.waxcenter.com.
These and other important factors could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any forward-looking statement that the Company makes in this press release speaks only as of the date of such statement. Except as required by law, the Company does not have any obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements, whether as a result of new information, future events or otherwise.
Disclosure Regarding Non-GAAP Financial Measures
In addition to the financial measures presented in this release in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”), the Company has included certain non-GAAP financial measures in this release, including Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income and Net Leverage Ratio. Management believes these non-GAAP financial measures are useful because they enable management, investors, and others to assess the operating performance of the Company.
We define EBITDA as net income (loss) before interest, taxes, depreciation and amortization. We believe that EBITDA, which eliminates the impact of certain expenses that we do not believe reflect our underlying business performance, provides useful information to investors to assess the performance of our business.
We define Adjusted EBITDA as net income (loss) before interest, taxes, depreciation and amortization, adjusted for the impact of certain additional non-cash and other items that we do not consider in our evaluation of ongoing performance of our core operations. These items include non-cash equity-based compensation expense, non-cash gains and losses on remeasurement of our tax receivable agreement liability, contractual cash interest on our tax receivable agreement liability, loss on disposal or impairment of assets, transaction costs, business transformation costs and other one-time expenses and/or gains. Business transformation costs primarily include expenses related to our business transformation and optimization efforts that do not qualify as capital expenditures under applicable accounting principles.
We define Adjusted EBITDA Margin as Adjusted EBITDA divided by total revenue.
We define Adjusted Net Income (Loss) as net income (loss) adjusted for the impact of certain additional non-cash and other items that we do not consider in our evaluation of ongoing performance of our core operations. These items include non-cash equity-based compensation expense, amortization of intangible assets, debt extinguishment costs, non-cash gains and losses on remeasurement of our tax receivable agreement liability, contractual cash interest on our tax receivable agreement liability, loss on disposal or impairment of assets, transaction costs, business transformation costs and other one-time expenses and/or gains. Prior to the first quarter of 2025, the Company did not include amortization of intangible assets in the calculation. However, the Company revised the definition in the first quarter of 2025 as a result of a change in the way management reviews Adjusted Net Income (Loss) in order to remove the impact of the non-cash amortization of intangible assets which management does not view as part of our core operations. Management believes excluding this enables investors to evaluate more clearly and consistently the Company's core operating performance in the same manner that management evaluates its core operating performance. The comparative period was also adjusted based on the revised definition.
We define Net Leverage Ratio as the total principal balance of our outstanding debt (“total debt”) less cash and cash equivalents, then divided by Adjusted EBITDA for the trailing twelve months.
Please refer to the reconciliations of non-GAAP financial measures to their GAAP equivalents located at the end of this release. This release includes forward-looking guidance for certain non-GAAP financial measures, including Adjusted EBITDA and Adjusted Net Income. These measures will differ from net income (loss), determined in accordance with GAAP, in ways similar to those described in the reconciliations at the end of this release. We are not able to provide, without unreasonable effort, guidance for net income (loss), determined in accordance with GAAP, or a reconciliation of guidance for Adjusted EBITDA and Adjusted Net Income (Loss) to the most directly comparable GAAP measure because the Company is not able to predict with reasonable certainty the amount or nature of all items that will be included in net income (loss).
Glossary of Terms for Our Key Business Metrics
System-Wide Sales. System-wide sales represent sales from same day services, retail sales and cash collected from wax passes for all centers in our network, including both franchisee-owned and corporate-owned centers. While we do not record franchised center sales as revenue, our royalty revenue is calculated based on a percentage of franchised center sales, which are
Same-Store Sales. Same-store sales reflect the change in sales over a comparable 52-week period year over year from services performed and retail sales for the same-store base. We define the same-store base to include those centers open for at least 52 full weeks. If a center is closed for greater than six consecutive days, the center is deemed a closed center and is excluded from the calculation of same-store sales until it has been reopened for a continuous 52 full weeks. This measure highlights the performance of existing centers, while excluding the impact of new center openings and closures. We review same-store sales for corporate-owned centers as well as franchisee-owned centers. Same-store sales growth is driven by increases in the number of transactions and average transaction size.
| EUROPEAN WAX CENTER, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except share and per share amounts) | ||||||||
| January 3, 2026 | January 4, 2025 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 76,060 | $ | 49,725 | ||||
| Restricted cash | 6,421 | 6,469 | ||||||
| Accounts receivable, net | 10,957 | 7,283 | ||||||
| Inventory, net | 17,772 | 19,070 | ||||||
| Prepaid expenses and other current assets | 5,329 | 5,292 | ||||||
| Total current assets | 116,539 | 87,839 | ||||||
| Property and equipment, net | 10,788 | 2,313 | ||||||
| Operating lease right-of-use assets | 3,378 | 3,313 | ||||||
| Intangible assets, net | 412,826 | 432,160 | ||||||
| Goodwill | 39,112 | 39,112 | ||||||
| Deferred income taxes | 141,332 | 140,315 | ||||||
| Other non-current assets | 1,285 | 2,015 | ||||||
| Total assets | $ | 725,260 | $ | 707,067 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued liabilities | $ | 25,118 | $ | 17,354 | ||||
| Long-term debt, current portion | 4,000 | 4,000 | ||||||
| Tax receivable agreement liability, current portion | 8,735 | 9,353 | ||||||
| Deferred revenue, current portion | 4,057 | 4,149 | ||||||
| Operating lease liabilities, current portion | 1,234 | 1,255 | ||||||
| Total current liabilities | 43,144 | 36,111 | ||||||
| Long-term debt, net | 374,827 | 373,246 | ||||||
| Tax receivable agreement liability, net of current portion | 192,735 | 194,917 | ||||||
| Deferred revenue, net of current portion | 4,732 | 5,836 | ||||||
| Operating lease liabilities, net of current portion | 2,244 | 2,318 | ||||||
| Deferred tax liability | 845 | 738 | ||||||
| Other long-term liabilities | 1,859 | 2,309 | ||||||
| Total liabilities | 620,386 | 615,475 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity: | ||||||||
| Preferred stock ( | — | — | ||||||
| Class A common stock ( | — | — | ||||||
| Class B common stock ( | — | — | ||||||
| Treasury stock, at cost, 9,818,777 and 8,389,949 shares of Class A common stock as of January 3, 2026 and January 4, 2025, respectively | (86,240 | ) | (80,148 | ) | ||||
| Additional paid-in capital | 257,246 | 244,611 | ||||||
| Accumulated deficit | (91,734 | ) | (100,416 | ) | ||||
| Total stockholders’ equity attributable to European Wax Center, Inc. | 79,272 | 64,047 | ||||||
| Noncontrolling interests | 25,602 | 27,545 | ||||||
| Total stockholders’ equity | 104,874 | 91,592 | ||||||
| Total liabilities and stockholders’ equity | $ | 725,260 | $ | 707,067 | ||||
| EUROPEAN WAX CENTER, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in thousands) | ||||||||||||||||
| For the Thirteen Weeks Ended | For the Years Ended | |||||||||||||||
| January 3, 2026 | January 4, 2025 | January 3, 2026 | January 4, 2025 | |||||||||||||
| REVENUE | ||||||||||||||||
| Product sales | $ | 22,574 | $ | 26,348 | $ | 112,566 | $ | 121,453 | ||||||||
| Royalty fees | 12,508 | 12,780 | 52,409 | 53,094 | ||||||||||||
| Marketing fees | 7,222 | 7,330 | 30,107 | 30,171 | ||||||||||||
| Other revenue | 2,799 | 3,283 | 11,544 | 12,198 | ||||||||||||
| Total revenue | 45,103 | 49,741 | 206,626 | 216,916 | ||||||||||||
| OPERATING EXPENSES | ||||||||||||||||
| Cost of revenue | 11,907 | 12,762 | 53,834 | 57,313 | ||||||||||||
| Selling, general and administrative | 15,482 | 14,845 | 58,365 | 58,696 | ||||||||||||
| Advertising | 7,883 | 4,276 | 30,898 | 32,949 | ||||||||||||
| Depreciation and amortization | 5,377 | 5,033 | 20,402 | 20,279 | ||||||||||||
| Loss (gain) on disposal or impairment of assets | — | — | 125 | (2 | ) | |||||||||||
| Gain on sale of centers | — | — | — | (81 | ) | |||||||||||
| Total operating expenses | 40,649 | 36,916 | 163,624 | 169,154 | ||||||||||||
| Income from operations | 4,454 | 12,825 | 43,002 | 47,762 | ||||||||||||
| Interest expense, net | 6,560 | 6,449 | 26,307 | 25,492 | ||||||||||||
| Other expense | 83 | 4,864 | 91 | 5,399 | ||||||||||||
| (Loss) income before income taxes | (2,189 | ) | 1,512 | 16,604 | 16,871 | |||||||||||
| Income tax expense (benefit) | (728 | ) | (1,561 | ) | 4,735 | 2,190 | ||||||||||
| NET (LOSS) INCOME | $ | (1,461 | ) | $ | 3,073 | $ | 11,869 | $ | 14,681 | |||||||
| Less: Net (loss) income attributable to noncontrolling interests | (874 | ) | 1,105 | 3,187 | 4,219 | |||||||||||
| NET (LOSS) INCOME ATTRIBUTABLE TO EUROPEAN WAX CENTER, INC. | $ | (587 | ) | $ | 1,968 | $ | 8,682 | $ | 10,462 | |||||||
| EUROPEAN WAX CENTER, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Amounts in thousands) | ||||||||
| For the Years Ended | ||||||||
| January 3, 2026 | January 4, 2025 | |||||||
| Cash flows from operating activities: | ||||||||
| Net income | $ | 11,869 | $ | 14,681 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Depreciation and amortization | 20,402 | 20,279 | ||||||
| Amortization of deferred financing costs | 5,924 | 5,590 | ||||||
| (Decrease) provision for inventory obsolescence | (61 | ) | 259 | |||||
| Provision for bad debts | 17 | 570 | ||||||
| Gain on sale of centers | — | (81 | ) | |||||
| Loss on disposal of property and equipment | 125 | 3 | ||||||
| Deferred income taxes | 4,345 | 2,334 | ||||||
| Remeasurement of tax receivable agreement liability | 91 | 5,399 | ||||||
| Equity compensation | 6,531 | 5,150 | ||||||
| Changes in assets and liabilities: | ||||||||
| Accounts receivable | (3,690 | ) | 1,327 | |||||
| Inventory, net | 1,359 | 1,418 | ||||||
| Prepaid expenses and other assets | 1,315 | 2,800 | ||||||
| Accounts payable and accrued liabilities | 7,566 | (417 | ) | |||||
| Deferred revenue | (1,196 | ) | (1,704 | ) | ||||
| Other long-term liabilities | (1,598 | ) | (1,102 | ) | ||||
| Net cash provided by operating activities | 52,999 | 56,506 | ||||||
| Cash flows from investing activities: | ||||||||
| Purchases of property and equipment | (2,912 | ) | (521 | ) | ||||
| Cash received for sale of center | — | 135 | ||||||
| Net cash used in investing activities | (2,912 | ) | (386 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Principal payments on long-term debt | (4,000 | ) | (4,000 | ) | ||||
| Distributions to EWC Ventures LLC members | (3,754 | ) | (4,313 | ) | ||||
| Repurchase of Class A common stock | (6,092 | ) | (40,148 | ) | ||||
| Taxes on vested restricted stock units paid by withholding shares | (171 | ) | (557 | ) | ||||
| Dividend equivalents to holders of EWC Ventures units | (10 | ) | (789 | ) | ||||
| Payments pursuant to tax receivable agreement | (9,773 | ) | (9,347 | ) | ||||
| Net cash used in financing activities | (23,800 | ) | (59,154 | ) | ||||
| Net increase (decrease) in cash, cash equivalents and restricted cash | 26,287 | (3,034 | ) | |||||
| Cash, cash equivalents and restricted cash, beginning of period | 56,194 | 59,228 | ||||||
| Cash, cash equivalents and restricted cash, end of period | $ | 82,481 | $ | 56,194 | ||||
| Supplemental cash flow information: | ||||||||
| Cash paid for interest | $ | 21,671 | $ | 21,894 | ||||
| Cash paid for income taxes | $ | 214 | $ | 498 | ||||
| Non-cash investing activities: | ||||||||
| Property purchases included in accounts payable and accrued liabilities | $ | 105 | $ | 593 | ||||
| Property purchases included in additional paid-in capital | $ | 6,526 | $ | 116 | ||||
| Right-of-use assets obtained in exchange for operating lease liabilities | $ | 1,199 | $ | 592 | ||||
Reconciliation of Net Income to Adjusted Net Income:
| For the Thirteen Weeks Ended | For the Years Ended | |||||||||||||||
| January 3, 2026 | January 4, 2025 | January 3, 2026 | January 4, 2025 | |||||||||||||
| (in thousands) | ||||||||||||||||
| Net (loss) income | $ | (1,461 | ) | $ | 3,073 | $ | 11,869 | $ | 14,681 | |||||||
| Share-based compensation(1) | 1,165 | 945 | 6,531 | 5,150 | ||||||||||||
| Remeasurement of tax receivable agreement liability(2) | 83 | 4,864 | 91 | 5,399 | ||||||||||||
| Gain on sale of center(3) | — | — | — | (81 | ) | |||||||||||
| Loss on disposal or impairment of assets(4) | — | — | 125 | — | ||||||||||||
| Legal settlements(5) | — | 15 | 261 | (724 | ) | |||||||||||
| Executive severance(6) | — | — | 465 | 1,548 | ||||||||||||
| Reorganization costs(7) | — | 140 | 240 | 630 | ||||||||||||
| Business transformation costs(8) | 1,686 | — | 2,236 | — | ||||||||||||
| Terminated debt offering costs(9) | — | (3 | ) | — | 941 | |||||||||||
| Tax effect of adjustments to net income(10) | (1,064 | ) | (916 | ) | (1,108 | ) | (1,930 | ) | ||||||||
| Adjusted Net Income, as previously defined | $ | 409 | $ | 8,118 | $ | 20,710 | $ | 25,614 | ||||||||
| Amortization of intangible assets(11) | 4,834 | 4,834 | 19,335 | 19,335 | ||||||||||||
| Tax effect of adjustments to net income(10) | (1,025 | ) | (1,092 | ) | (3,860 | ) | (4,003 | ) | ||||||||
| Adjusted Net Income | $ | 4,218 | $ | 11,860 | $ | 36,185 | $ | 40,946 | ||||||||
(1) Represents non-cash equity-based compensation expense.
(2) Represents non-cash adjustments related to the remeasurement of our tax receivable agreement liability.
(3) Represents gain on the sale of a corporate-owned center.
(4) Represents the loss on disposal or impairment of assets
(5) In the current fiscal year, the amount represents the estimated exposure to the Company resulting from a lawsuit, and in the prior fiscal year, the amount represents the collection of cash proceeds from a legal judgment, both of which were not resulting from our core operations.
(6) Represents cash severance paid or payable to former executives.
(7) Represents costs associated with the Company's return-to-office mandate.
(8) Represents costs related to our business transformation and optimization efforts that do not qualify as capital expenditures under applicable accounting principles.
(9) Represents costs related to a debt offering the Company evaluated and subsequently decided to terminate.
(10) Represents the estimated income tax impact of non-GAAP adjustments computed by applying our estimated blended statutory tax rate to our share of the identified items and incorporating the effect of nondeductible and other rate impacting adjustments. The tax effect of the add-back of share-based compensation results in a further increase to net income due to the elimination of the Section 162(m) permanent difference that resulted from nondeductible officer share-based compensation.
(11) Represents the amortization of franchisee relationships and reacquired rights.
Reconciliation of Net Income to EBITDA and Adjusted EBITDA:
| For the Thirteen Weeks Ended | For the Years Ended | Trailing Twelve Months Ended | ||||||||||||||||||
| January 3, 2026 | January 4, 2025 | January 3, 2026 | January 4, 2025 | January 3, 2026 | ||||||||||||||||
| (in thousands) | ||||||||||||||||||||
| Net (loss) income | $ | (1,461 | ) | $ | 3,073 | $ | 11,869 | $ | 14,681 | $ | 11,869 | |||||||||
| Interest expense, net | 6,560 | 6,449 | 26,307 | 25,492 | 26,307 | |||||||||||||||
| Income tax expense (benefit) | (728 | ) | (1,561 | ) | 4,735 | 2,190 | 4,735 | |||||||||||||
| Depreciation and amortization | 5,377 | 5,033 | 20,402 | 20,279 | 20,402 | |||||||||||||||
| EBITDA | $ | 9,748 | $ | 12,994 | $ | 63,313 | $ | 62,642 | $ | 63,313 | ||||||||||
| Share-based compensation(1) | 1,165 | 945 | 6,531 | 5,150 | 6,531 | |||||||||||||||
| Remeasurement of tax receivable agreement liability(2) | 83 | 4,864 | 91 | 5,399 | 91 | |||||||||||||||
| Gain on sale of center(3) | — | — | — | (81 | ) | — | ||||||||||||||
| Loss on disposal or impairment of assets(4) | — | — | 125 | — | 125 | |||||||||||||||
| Legal settlements(5) | — | 15 | 261 | (724 | ) | 261 | ||||||||||||||
| Executive severance(6) | — | — | 465 | 1,548 | 465 | |||||||||||||||
| Reorganization costs(7) | — | 140 | 240 | 630 | 240 | |||||||||||||||
| Business transformation costs(8) | 1,686 | — | 2,236 | — | 2,236 | |||||||||||||||
| Terminated debt offering costs(9) | — | (3 | ) | — | 941 | — | ||||||||||||||
| Adjusted EBITDA | $ | 12,682 | $ | 18,955 | $ | 73,262 | $ | 75,505 | $ | 73,262 | ||||||||||
| Total revenue | $ | 45,103 | $ | 49,741 | $ | 206,626 | $ | 216,916 | $ | 206,626 | ||||||||||
| Net income (loss) margin | (3.2 | )% | 6.2 | % | 5.7 | % | 6.8 | % | 5.7 | % | ||||||||||
| Adjusted EBITDA Margin | 28.1 | % | 38.1 | % | 35.5 | % | 34.8 | % | 35.5 | % | ||||||||||
(1) Represents non-cash equity-based compensation expense.
(2) Represents non-cash adjustments related to the remeasurement of our tax receivable agreement liability.
(3) Represents gain on the sale of a corporate-owned center.
(4) Represents the loss on disposal or impairment of assets
(5) In the current fiscal year, the amount represents the amount recorded to SG&A relating to a lawsuit, and in the prior fiscal year, the amount represents the collection of cash proceeds from a legal judgment, both of which were not resulting from our core operations.
(6) Represents cash severance paid or payable to former executives.
(7) Represents costs associated with the Company's return-to-office mandate.
(8) Represents costs related to our marketing transformation and optimization efforts that do not qualify as capital expenditures under applicable accounting principles.
(9) Represents costs related to a debt offering the Company evaluated and subsequently decided to terminate.
Reconciliation of Total Debt to Net Leverage Ratio:
| Trailing Twelve Months | |||||
| January 3, 2026 | |||||
| (in thousands) | |||||
| Total debt | $ | 386,000 | |||
| Less: Cash and cash equivalents | (76,060 | ) | |||
| Net Debt | $ | 309,940 | |||
| Adjusted EBITDA | 73,262 | ||||
| Net Leverage Ratio | 4.2 | x | |||
Contact
Edelman Smithfield for European Wax Center, Inc.
EWCIR@edelman.com
FAQ
What were European Wax Center (EWCZ) fiscal 2025 total revenue and system-wide sales?
How did European Wax Center (EWCZ) earnings change in fiscal 2025 compared to 2024?
What is the status of European Wax Center's (EWCZ) share repurchase program and recent buybacks?
Will European Wax Center (EWCZ) provide fiscal 2026 guidance or host an earnings call?
How many centers did European Wax Center (EWCZ) operate at year-end and what was the net change?
What is European Wax Center's (EWCZ) year-end liquidity and debt position after fiscal 2025?
