Brilliant Earth Group Q1 Earnings Call Highlights

Key Points

• Brilliant Earth reported Q1 net sales up about 6% to $99.5M, driven by higher-priced purchases and fine jewelry momentum—fine jewelry bookings rose 33% YoY (17% of bookings) and the Sol Collection bookings jumped 90% YoY, while showroom fine-jewelry bookings grew 48% YoY.
• Margins and profitability were pressured by high metal costs with gross margin at 54.3% and adjusted EBITDA of −$4.7M in Q1, but management expects sequential margin improvement and guided Q2 adjusted EBITDA of $0.5M–$2M and full-year mid-single-digit sales growth with a mid‑fifties gross margin.
• The balance sheet shows about $59M cash and no debt, inventory turns >4x, and management is investing in showroom expansion and staffing while noting a consumer bifurcation—softness at lower price points alongside continued strength at higher price points.

Brilliant Earth Group NASDAQ: BRLT reported first-quarter 2026 results that management said reflected “disciplined execution” of its growth strategy, led by continued strength in higher-priced purchases and rapid expansion in fine jewelry. Net sales rose about 6% year-over-year to $99.5 million, landing at the high end of the company’s guidance range, while total orders increased roughly 3%.

Fine jewelry growth and higher price points drive results

Chief Executive Officer Beth Gerstein said the quarter’s performance was supported by repeat order strength and year-over-year average selling price gains “across the assortment.” Fine jewelry was a key contributor: Gerstein said fine jewelry bookings increased 33% year-over-year and represented 17% of total bookings. She also highlighted “impressive” year-over-year bookings growth in wedding and anniversary bands.

Gerstein pointed to ongoing evidence of brand momentum during key gifting periods. She said Valentine’s Day was “a record,” with bookings up 9% year-over-year during the two-week peak shopping window, and attributed campaign results to storytelling and engagement, citing “triple-digit year-over-year growth in organic social engagement” from the company’s Perfect Timing campaign.

The company also emphasized product momentum in signature collections. Gerstein said bookings from Brilliant Earth’s proprietary Sol Collection, first launched in the fourth quarter of 2023, grew 90% year-over-year.

Showroom expansion and experiential retail

Brilliant Earth ended the quarter with 42 showrooms and is planning two more locations—San Antonio, Texas, and San Jose, California—by year-end, Gerstein said. Management discussed the role of physical retail in supporting fine jewelry growth. Gerstein said fine jewelry bookings in showrooms grew 48% year-over-year in the quarter, outpacing overall assortment growth.

She also described longer-term progress tied to in-showroom fine jewelry merchandising. After introducing its first “fine jewelry try-on bar” in the third quarter of 2024 and expanding the concept across showrooms, Gerstein said fine jewelry bookings from showrooms “have nearly doubled” in the 18 months following compared with the prior 18-month period.

Gerstein highlighted the company’s Beverly Hills flagship location, which opened in January, saying it has delivered “very strong retail orders and foot traffic with exceptional customer sentiment.” She added that the flagship’s “Date Night” appointment format has been “incredibly popular” and is “typically booked multiple weeks in advance.”

In addition, Gerstein said the company launched “Bridal Collective” creator-hosted events in New York and Beverly Hills, generating “over 150 pieces of organic content across 41 creators.”

Margins, pricing actions, and cost pressures

Chief Financial Officer Jeffrey Kuo reported gross margin of 54.3%, which he said was within expectations for “mid-50s” margins. Kuo attributed margin pressure to “historically high metal prices” impacting cost of goods, partially offset by pricing and operational levers including “price optimization,” product design and specification changes, “vendor procurement efficiencies,” and hedging.

Both Gerstein and Kuo said they expect gross margin improvement as 2026 progresses. Gerstein said the company believes first quarter “marks the low point” for gross margin this year, while Kuo said the company expects gross margin in the remainder of 2026 “to be higher than Q1” as initiatives continue. In response to an analyst question, Kuo added that quarter-to-date the company has seen “improving gross margins” sequentially.

On pricing, management said selective increases were taken to offset metal costs, while monitoring elasticity. Responding to TD Cowen analyst Oliver Chen, Gerstein said the company is being “very surgical” and is focused on “protect[ing] value, quality, profitability while still making sure that we are attracting that new customer.”

Profitability and operating expense trends

Adjusted EBITDA was negative $4.7 million in the quarter, representing a negative 4.7% margin, which Kuo said was in the upper half of the company’s guidance range. He noted that the first quarter is typically the company’s seasonally lowest quarter for net sales and that higher profitability is expected in subsequent quarters.

Operating expense was 63.3% of net sales versus 62.4% in the prior-year quarter, reflecting about 90 basis points of deleverage. Adjusted operating expense was 59.2% of net sales compared with 57.6% in the prior-year period. Kuo said higher employee costs—up about 190 basis points as a percentage of sales on an adjusted basis—reflected increased showroom staffing, including newly opened showrooms. Other G&A rose by about 60 basis points as a percentage of sales on an adjusted basis, which Kuo said reflected a “balanced approach” to cost discipline while investing for the medium and long term.

Marketing expense improved as a percentage of revenue. Kuo reported marketing expense of 23.6% of net sales, down from 24.5% a year earlier, representing about 90 basis points of year-over-year leverage.

Balance sheet, inventory, and outlook

Brilliant Earth ended the quarter with approximately $59 million in cash and no debt, Kuo said. He noted the year-over-year decline in cash reflected the payoff of the company’s term loan in the third quarter of the prior year and the completion of a “one-time dividend and distribution of approximately $25 million” last year.

Inventory increased year-over-year, which Kuo attributed primarily to “strategic procurement opportunities” to buy diamond and jewelry inventory at advantageous prices last year and to growth in the fine jewelry assortment. Even so, he said inventory turns remained “over 4 times,” which management said is significantly above the industry average.

Looking ahead, Kuo guided to second-quarter net sales growth in the low single-digit percentage range year-over-year and adjusted EBITDA of $0.5 million to $2 million. For the full year, the company reiterated expectations for mid-single-digit net sales growth and a mid-fifties gross margin, along with marketing leverage as a percentage of net sales. Kuo said full-year adjusted EBITDA dollars are expected to be positive but “slightly lower than 2025,” with most of the year’s adjusted EBITDA anticipated in the fourth quarter due to seasonal revenue patterns and expected gross margin improvements.

Management also discussed consumer behavior trends, citing a bifurcation between higher and lower price points. Gerstein said the company is seeing “some signs of softness at lower price points,” while demand at higher price points is “holding up well” in the second quarter to date. She added that quarter-to-date bookings growth has been driven by higher price points and fine jewelry outperformance.

On the product pipeline, Gerstein highlighted new launches including the Butterfly Collection and the Keepsake Collection ahead of Mother’s Day, and said additional collections are planned for later in the year. She also noted the company “reintroduced” its Ring Pop collaboration, which she said “sold out.”

During the Q&A, Gerstein addressed how fine jewelry is influencing customer acquisition and repeat behavior, saying the company continues to invest in both bridal and fine jewelry and is “laser focused” on driving repeat and loyalty. Kuo added that as fine jewelry grows over time, the company expects “some moderation in price points overall” because fine jewelry generally carries lower price points than bridal.

Gerstein said the company has not made changes to its full-year outlook based on macro factors discussed on the call, including energy prices, reiterating that the company is maintaining its prior guidance.

About Brilliant Earth Group NASDAQ: BRLT

Brilliant Earth Group, Inc NASDAQ: BRLT is a specialty retailer of ethically sourced fine jewelry, with a focus on conflict-free diamonds and lab-grown gemstones. The company offers a broad range of products that include engagement rings, wedding bands, necklaces, earrings and bracelets, all crafted with a commitment to environmental sustainability and social responsibility. Customers can choose from a variety of materials such as recycled precious metals, responsibly sourced gemstones and innovative lab-grown diamonds.

Operating primarily through its e-commerce platform and a network of branded showrooms across major U.S.

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