Adore Beauty posted record FY26 revenue of $207.3 million and underlying EBITDA of only about $4 million. The store rollout bought growth and reach and ate the margin that made the online model attractive. A warning for any Australian brand weighing a move into physical retail.
The Take: Adore Beauty grew revenue to a record and made almost no money doing it. That is the store-network tax few warn online retailers about. Opening stores buys growth and reach, and it eats the margin that made the online model attractive in the first place.
The numbers: Adore Beauty posted record FY26 revenue of $207.3 million, up 4.3%, as its move into physical retail gained traction. Underlying EBITDA landed at about $4 million. On $207 million of revenue, that is a margin close to 2%. In-store revenue of almost $19 million shows the network is working. The cost of building it shows up everywhere else on the page.
The detail: Adore now runs 20 locations, 14 Adore Beauty stores and 6 iKOU stores, after opening three in the second half at Kotara, Parramatta and Robina. It is targeting at least 10% revenue growth and $9 million to $13 million of underlying EBITDA in FY27. The bet is that this was the investment year and next year is when the stores start paying for themselves.
Adore Beauty's record FY26 revenue, sitting on underlying EBITDA of only about $4 million
Zoom out: The pure-play online model was supposed to be the efficient one. Lower overheads, no leases, no fit-outs. What Adore's numbers show is that acquisition got expensive enough online that a store network started to look cheaper than another year of bidding against every rival for the same clicks. That is a warning worth reading for any Australian brand still treating physical presence as a step backward.
For Australian operators: If you are weighing a move into physical stores, model the margin before the revenue. A store can lift brand, add reach and lower blended acquisition cost. It also carries fixed costs that do not flex when trading softens. Ask what each channel actually costs to serve, not just what it sells. Set a date by which the new channel must cover its own costs and hold yourself to it. Growth that arrives with a 2% margin is not a strategy. It is a bet that next year is different, and next year has to actually be different.