Q2 2026 Boozt AB Earnings Call

August 14, 2026

Speaker #1: For the first part of the presentation, participants will be in listen-only mode. During the Q&A session, participants are able to ask questions by dialing the pound key and 5 on their telephone keypad.

Operator: For the first part of the presentation, participants will be in listen-only mode. During the questions and answer session, participants are able to ask questions by dialing pound key 5 on their telephone keypad. Now I will hand the conference over to CEO Hermann Haraldsson and CFO Michael Bjergby. Please go ahead.

Operator: For the first part of the presentation, participants will be in listen-only mode. During the questions and answer session, participants are able to ask questions by dialing pound key five on their telephone keypad. Now I will hand the conference over to CEO Hermann Haraldsson and CFO Michael Bjergby. Please go ahead.

Speaker #1: Now I will hand the conference over to CEO Herman Harreldsen and CFO Michael Bjørgby. Please, go ahead.

Speaker #2: Thank you, and good morning to all, and welcome to our Q2 2026 webcast. So, let's just turn to the first slide. The agenda for today's presentation: we'll follow our usual agenda.

Hermann Haraldsson: Thank you, and good morning to all, and welcome to our Q2 2026 webcast. Let's just turn to the first slide, the agenda. For today's presentation, we will follow our usual agenda. I will take you through the highlights and the strategic developments, and then Michael will walk you through the numbers in detail. Please move on to the next slide. When we started 2026, our ambition was clear. We wanted to get back to double-digit growth. We were quite confident that the initiatives we had put in place in 2025 were the right ones to position us strongly in the market, and that they would bring us our growth momentum back. This is why I am very pleased that the results came through even faster than we expected. We grew 13% in the second quarter, and we almost doubled our EBIT margin to 6.5%.

Speaker #2: I'll take you through the highlights and the strategic developments, and then Michael will walk you through the numbers in detail. So, please move on to the next slide.

Speaker #2: When we started 2026, our ambition was clear: we wanted to get back to double-digit growth. We were quite confident that the initiatives we had put in place in 2025 were the right ones to position us strongly in the market, and that they would bring our growth momentum back.

Speaker #2: So this is why I'm very pleased that the results came through even faster than we expected. We grew 13% in the second quarter, and we almost doubled our EBIT margin to 6.5%.

Speaker #2: And this was a broad-based performance, with every major category and every market contributing. Behind the quarter, there were three main drivers. The first is our new assortment strategy, which is broader and more inspirational than before.

Hermann Haraldsson: This was a broad-based performance with every major category and every market contributing. Behind the quarter, there were three main drivers. The first is our new assortment strategy, which is broader and more inspirational than before. We offered 55% more styles on Boozt.com than in the same quarter last year, and sold almost as many different styles also during the quarter. That was very positive. The second is AI. Our new AI initiatives have clearly improved the customer experience, and we are happy to see that our customers are responding accordingly. The third thing is a real step change in our commercial organization. We have built a powerhouse of local country specialists all sitting together at our new headquarters in Copenhagen, and this is something that we just couldn't have done before we moved the headquarters from Luleå, Sweden, to Copenhagen.

Speaker #2: We offered 55% more styles on Boozt.com than in the same quarter last year, and sold almost as many different styles also during the quarter.

Speaker #2: So that was very positive. The second is AI: our new AI initiatives have clearly improved the customer experience, and we're happy to see that our customers are responding accordingly.

Speaker #2: And the third thing is a real step change in our commercial organization. We've built a powerhouse of local country specialists, all sitting together at our new headquarters in Copenhagen, and this is something that we just couldn't have done before we moved the headquarters from Hylland, Sweden, to Copenhagen.

Speaker #2: Alongside this very encouraging performance, we also decided during the quarter to sharpen our focus to make sure that we capture the full potential of our core business.

Hermann Haraldsson: Alongside this very encouraging performance, we also decided during the quarter to sharpen our focus to make sure that we capture the full potential of our core business. This is why we closed our B2B gift shop initiative and narrowed our focus. As we say now, we don't need to do everything. We just need to be very good at doing the right things. We are now ramping up inventory as planned, and we will go into the autumn and winter season with more stock than last year, and considerably better stock. This is the key to keeping our momentum. On the back of the current performance, we have also decided to expand our share buyback program to SEK 300 million, up from the SEK 200 million we announced after Q1.

Speaker #2: So this is why we closed our B2B gift shop initiative and narrowed our focus. As we say, you know, we don't need to do everything; we just need to be very good at doing the right things.

Speaker #2: We are now ramping up inventory as planned, and we'll go into the autumn and winter season with more stock than last year—and considerably better stock.

Speaker #2: And this is the key to keeping our momentum. On the back of the current performance, we've also decided to expand our share buyback program to SEK 300 million, up from the SEK 200 million we announced after Q1.

Speaker #2: And finally, with Q3 tracking as expected, the guidance upgrade we announced on 29 June is firmly confirmed. We don't take the second half for granted, but we're entering it from a position of real strength.

Hermann Haraldsson: And finally, with Q3 tracking as expected, the guidance upgrade we announced on 29 June is firmly confirmed. We don't take the H2 for granted, but we're entering it from a position of real strength. Please turn to slide 5. The women are back. Our clearest acceleration is coming from women's fashion. After several quarters of decline, the category is now growing strongly again. The numbers of customers shopping women's fashion on Boozt.com was up 20% in the quarter, and this wasn't just a one-month spike. The trend was stable and solid all the way through the quarter. This matters a great deal because women who shop with us, they don't stay in one category. They browse and buy across all of them, home, beauty, kids, and sport, and even in menswear.

Speaker #2: So now, please turn to slide number 5. The women are back. Our clearest acceleration is coming from women's fashion. After several quarters of decline, the category is now growing strongly again.

Speaker #2: The number of customers shopping Women's Fashion and Boozt.com was up 20% in the quarter, and this wasn't just a one-month spike. The trend was stable and solid all the way through the quarter.

Speaker #2: And this matters a great deal because women who shop with us, they don't stay in one category. They browse and buy across all of them—home, beauty, kids, and sport, and even in menswear.

Speaker #2: And that is exactly what lifts basket value and loyalty across the platform, and ultimately, what creates long-term, sustainable growth. So, let's turn to the next slide.

Hermann Haraldsson: That is exactly what lifts basket value and loyalty across the platform, and ultimately, what creates long-term sustainable growth. Let's turn to the next slide. One of the key drivers behind this acceleration is our revised assortment strategy. We've deliberately become more inspirational and less promotional, adding new brands, more breadth, and greater variety to our offering on Boozt.com. That also included more premium products, which helped to elevate the shop and ultimately the brand. We added around 55% more styles to our spring/summer offering, and it really paid off through the Q2. We got more clicks from our performance marketing channels, and we converted them better. More choice for the customer, combined with reaching the right audience, worked just as we had hoped.

Speaker #2: One of the key drivers behind this acceleration is our revised assortment strategy. We’ve deliberately become more inspirational and less promotional, adding new brands, more breadth, and greater variety to our offering on Boozt.com.

Speaker #2: That also included more premium products, which helped to elevate the shop and, ultimately, the brand. We added around 55% more styles to our spring/summer offering, and it really paid off through the second quarter.

Speaker #2: We got more clicks from our performance marketing channels, and we converted them better. So, more choice for the customer combined with reaching the right audience worked just as we had hoped.

Speaker #2: Our focus now is firmly on the second half, and our plan for the autumn/winter is at least as ambitious as what we've just done for spring/summer.

Hermann Haraldsson: Our focus now is firmly on the H2, and our plan for the autumn/winter is at least as ambitious as what we've just done for spring/summer. We'll again increase the number of styles versus last year, and we'll bring in strong brands such as Gap, Max Mara, and Paul Smith, along with other strong brands that support the categories. With that, we're quite confident that we can carry our momentum into the most important time of the year. Please move on to the next slide. We've been able to grow revenue significantly in the H1 despite running on low inventory, and that says a lot about the quality of our stock and how well our assortment has performed. Now, we tend to be quite careful about carrying too much stock.

Speaker #2: We'll again increase the number of styles versus last year, and we'll bring in strong brands such as Gap, Max Mara, and Paul Smith, along with other strong brands that support the categories.

Speaker #2: So with that, we're quite confident that we can carry our momentum into the most important time of the year. So, please move on to the next slide.

Speaker #2: We've been able to grow revenue significantly in the first half, despite running on low inventory. That says a lot about the quality of our stock and how well our assortment has performed.

Speaker #2: Now, we tend to be quite careful about carrying too much stock. Some would say that we're almost allergic to it, but we recognize that going into the spring/summer season, we probably went a little too low.

Hermann Haraldsson: Some would say that we're almost allergic to it, but we recognize that going into the spring/summer season, we probably went a little too low. We're pleased that after those lower levels during the H1, our inventory is now above last year's, so the buildup is well on track. As we speak, autumn, winter products are arriving and going live in good volumes, and that leaves us feeling very confident about the season ahead. Let's move on. Look at AI and the customer journey. We covered our main initiatives on the last quarter's call, so I won't go into all that detail again, but I think there are kind of two things worth highlighting this quarter. The first is imagery.

Speaker #2: So we're pleased that after those lower levels during the first half, our inventory is now above last year's, so the build-up is well on track.

Speaker #2: And as we speak, Autumn/Winter products are arriving and going live in good volumes, and that leaves us feeling very confident about the season ahead.

Speaker #2: So let's move on. Looking at AI and the customer journey, we covered our main initiatives on last quarter's call, so I won't go into all that detail again. But I think there are kind of two things worth highlighting this quarter.

Speaker #2: The first is imagery. Since we launched our AI model, Images, in April, we have produced around 10,000 of them, adding roughly 300 new variants a day from just 16 reusable models and with no casting cost at all.

Hermann Haraldsson: Since we launched AI model images in April, we produced around 10,000 of them, adding roughly 300 new variants a day from just 16 reusable models and with no casting costs at all. Video is next, along with categories like shoes, bags, and accessories. The second is our shopping assistant, which now has been live across all markets since June. It is still very early days. Only around 3% of our customers use our AI assistant so far, but those who do, they convert at roughly 2.5 times our normal rate, and they spend about 8% more per order. We have only just started, and the next step is to make the underlying search even smarter and even more personal.

Speaker #2: Video is next, along with categories like shoes, bags, and accessories. The second is our shopping assistant, which has now been live across all markets since June.

Speaker #2: It's still very early days—only around 3% of our customers use our AI assistant so far—but those who do convert at roughly 2.5 times our normal rate, and they spend about 8% more per order.

Speaker #2: We've only just started, and the next step is to make the underlying search even smarter and even more personal. So it is opportunities like these that let us significantly improve the customer experience or service levels and the overall appeal of our sites.

Hermann Haraldsson: It is opportunities like these that let us significantly improve the customer experience, our service levels, and the overall appeal of our sites, and all at relatively low cost. Let us move on to the next slide. Here is a nice illustration, a colorful one, if you like, of AI at work. For the World Cup, we wanted to capture the moment, so we used AI to style outfits and create campaign imagery in each team's colors entirely from stock we already had, with no new photo shoot required. It was relevant, it was fast, and it was very local, except perhaps for Norway, who became global darlings during the tournament and could be used everywhere. It was quite spontaneous, and it is a small example, but it shows how quickly we can move on marketing content, basically how we can be relevant at light speed and at low cost.

Speaker #2: And all at relatively low costs. Let's move on to the next slide. Here is a nice illustration—a colorful one, if you like—of AI at work.

Speaker #2: For the World Cup, we wanted to capture the moment, so we used AI to style outfits and create campaign imagery in each team's colors.

Speaker #2: Entirely from stock we already had, with no new photoshoot required. It was relevant, it was fast, and it was very local—except perhaps for Norway, who became global darlings during the tournament and could be used everywhere.

Speaker #2: It was quite spontaneous, us, and it's a small example where it shows how quickly we can move on marketing content—basically, how we can be relevant at light speed and at low cost.

Speaker #2: So, please move to the next slide. Our department store model keeps compounding: 50.4% of our customers now buy from more than one category. Over the last 12 months, every single customer group buying across more than one category grew double digits versus last year.

Hermann Haraldsson: Please move to the next slide. Our department store model keeps compounding. 54% of our customers now buy from more than one category. Over the last 12 months, every single customer group buying across more than one category grew double digits versus last year. Our most engaged customers, the ones buying across all the six categories, were up by 15%. This is exactly the pattern that we are chasing. The more of our platform a customer touches, and the more of our categories she buys into, the more valuable she becomes, and the longer she stays with us. Put simply, it creates both value and stickiness. With that, I will now hand over to Michael for the financial review.

Speaker #2: And our most engaged customers, the ones buying across all six categories, were up by 15%. This is exactly the pattern that we're chasing. The more of the platform a customer touches, and the more categories she buys into, the more valuable she becomes.

Speaker #2: And the longer she stays with us. So, put simply, it creates both value and stickiness. So with that, I will now hand over to Michael for the financial review.

Speaker #1: Thank you, Herman. And good morning, everyone. Please go to slide number 12. So, we accelerated growth significantly in Q2, and when looking at all metrics—internal and external—the conclusion is that it was very broad-based across categories, countries, customers, etc.

Michael Bjergby: Thank you, Herman, and good morning, everyone. Please go to slide number 12. We accelerated growth significantly in Q2, and when looking at all metrics, internal and external, the conclusion is that it was very broad-based across categories, countries, customers, et cetera. We see strong growth in our new customers, but for the first time in years, we also have good growth in sales to our current existing customers. The initiatives that we have executed are playing out as planned. Our positioning and the focus on Boozt has led to strong double-digit growth, as you can see on the slide. This is really our main site and premium site, where we see then slower growth in Booztlet.com. That implies a higher quality of earnings, better margins, and it is also a positive for our long-term brand relations.

Speaker #1: So we see strong growth in our new customers, but for the first time in years, we also have good growth in sales to our current, existing customers.

Speaker #1: The initiatives that we have executed are playing out as planned. Our positioning and the focus on Boozt have led to strong double-digit growth, as you can see on the slide.

Speaker #1: And this is really our main site and premium site, where we see, then, slower growth in Boostlet. That implies higher quality of earnings, better margins, and it's also a positive for our long-term brand relations.

Speaker #1: We saw double-digit growth in all months of the quarter, and the change into a growth trajectory really happened from March. As such, we believe that our performance has been driven through market share gains rather than being market-driven during the summer.

Michael Bjergby: We saw double-digit growth in all months of the quarter. The change into growth trajectory really happened from March. As such, we believe that our performance has been driven through market share gains rather than being market-driven. During the summer, we did, however, see small signs of a general improvement in consumer spending in our core markets, we believe. Next slide. The repositioning and ambition to grow the profitability in a healthy way is really now showing up in the numbers as we have probably advertised a couple of times. Our gross margin reached 40.1%, a full percentage point ahead of last year. This is driven by real product margin. Boozt.com is doing less discounting as it leans further into being the premium destination, and the mix has shifted, so it is relatively more sales that comes from Boozt versus Booztlet.com.

Speaker #1: We did, however, see small signs of general improvement in consumer spending in our core markets, we believe. Next slide. So, the repositioning and ambition to grow the profitability in a healthy way is really now showing up in the numbers, as we have probably advertised a couple of times.

Speaker #1: But gross margin reached 40.1%, a full percentage point ahead of last year. This is driven by real product margin—Boozt.com is doing less discounting as it leans further into being the premium destination.

Speaker #1: And the mix has shifted, so it's relatively more sales that come from Boost versus Boostlet. Other revenue grew 6% in the quarter, and we expect that to accelerate quite materially in the second half, which will provide further support for the gross margin in the second half of the year.

Michael Bjergby: Other revenue grew 6% in a quarter, and we expect that to accelerate quite materially in H2, which will provide further support for the gross margin for H2. Please go to slide number 14 and profits. The profit development is generally showing improvement in the quality of earnings, increasing and healthy gross margin with leverage on the operational cost base. This is how we want to drive profitability improvements as we move along. In particular, for this quarter, we see improvement in the marketing cost ratio based on less offline spending, but also less marketing spend for Booztlet.com. Admin and other cost ratio is up fully as expected and planned, and as a result of our relocation to our new headquarter in Copenhagen, but also investments in our commercial team and resources. Adjustments for the quarter amounted to 39 million SEK.

Speaker #1: Please go to slide number 14 and profits. The profit development is generally showing improvement in the quality of earnings, with increasing and healthy gross margin, and leverage on the operational cost base.

Speaker #1: This is how we want to drive profitability improvements as we move along. In particular, for this quarter, we see improvement in the marketing cost ratio based on less offline spending, but also less marketing spend for Booztlet.

Speaker #1: Admin and other cost ratio is up fully as expected and planned, as a result of our relocation to our new headquarters in Copenhagen, but also due to investments in our commercial team and resources.

Speaker #1: Adjustments for the quarter amounted to SEK 39 million. SEK 28 million relates to share-based payments, which is a non-cash component, as you know, and correlates with performance and share price.

Michael Bjergby: 28 million relates to share-based payments, which is a non-cash component, as you know, and correlates with performance and the share price. The remaining 11 million SEK related to initiatives taken to focus on the core business, which Herman has already mentioned, and it mainly relates to the closing of the B2B shop initiative, leading to some FTE terminations, write-down of fixed assets, and elimination of a vendor software agreement. This was truly extraordinary, and we expect no further adjustments for the rest of the year, except for the usual share-based payments. Please go to slide number 15. We delivered a 13% higher revenue with lower inventory levels throughout H1. As such, it should not be a surprise that the performance of our inventory is much better than the performance in the same quarter last year.

Speaker #1: The remaining SEK 11 million relates to initiatives taken to focus on the core business, which Herman has already mentioned, and it mainly relates to the closing of the B2B shop initiative. This led to some FTE terminations, write-down of fixed assets, and elimination of a vendor software agreement.

Speaker #1: This was truly extraordinary, and we expect no further adjustments for the rest of the year except for the usual share-based payments. Please go to slide number 15.

Speaker #1: So, we delivered 13% higher revenue with lower inventory levels throughout the first half of the year. As such, it should not be a surprise that the performance of our inventory is much better than the performance in the same quarter last year.

Speaker #1: You can see that on the chart to the right. We have fewer products, but a stronger return on the capital we have employed. Currently, we now have inventory levels that are higher than last year, and we know that more products create more sales, but typically with a diminishing return on capital, so this is how we will continue to have strong growth in the second half.

Michael Bjergby: You can see that on the chart to the right. We have fewer products, but a stronger return on the capital we have employed. Currently, we now have inventory levels that is higher than last year, and we know that more products create more sales, but typically with a diminishing return on capital. This is how we will continue to have a strong growth in H2. Please move to slide number 16 and our cash development for the year. We have generated strong cash over the last 12 months of more than 600 million SEK. For Q2 alone, we were just above cash break even. It is a bit more than 100 million less than last year, despite stronger profit. There are two reasons for that, as you can see on the bars on the chart.

Speaker #1: Please move to slide number 16 and our cash development for the year. We have generated strong cash over the last 12 months of more than SEK 600 million, and for Q2 alone, we were just above cash break-even.

Speaker #1: It's a bit more than 100 million less than last year, despite stronger profit, and there are two reasons for that, as you can see on the bars on the chart.

Speaker #1: One, we pay exit tax related to our headquarter move, and two, we are increasing our inventory position compared to the same period last year.

Michael Bjergby: One, we pay exit tax related to our headquarter move, and two, we are increasing our inventory position compared to the same period last year. Both factors are fully in line with plan and expectations. Please go to the next slide on how we deploy this cash, because on slide 17, we have outlined that today, the board has initiated a mandate to increase the current share buyback program by another 100 million SEK. With this expansion, we expect to repurchase shares for an amount of around 400 million SEK this year, and that brings us to around 850 million SEK for the last two years, i.e., close to 10% of the share capital. We continue to have a very strong balance sheet, and we want to maintain that as we move forward, while still being disciplined in returning the excess cash that we generate back to shareholders.

Speaker #1: Both factors are fully in line with plan and expectations. Please go to the next slide on how we deployed this cash, because on slide 17, we have outlined that today the board has initiated a mandate to increase the current share buyback program by another 100 million SEK.

Speaker #1: With this expansion, we expect to repurchase shares for an amount of SEK 400 million—around SEK 400 million—this year, and that brings us to around SEK 850 million for the last two years.

Speaker #1: i.e., close to 10% of the share capital. We continue to have a very strong balance sheet, and we want to maintain that as we move forward, while still being disciplined in returning the excess cash that we generate back to shareholders.

Speaker #1: It is important to understand the dynamics of our cash generation, because in periods with very high growth, we will tie up capital in inventory and other areas to support the growth. Whereas, over the cycle, Boozt will fundamentally be highly cash-generative.

Michael Bjergby: It is important to understand the dynamics of our cash generation, because in periods with very high growth, we will tie capital in inventory and areas to support the growth, whereas over the cycle, Boozt will fundamentally be highly cash generative. That means that over the cycle, we will also be able to distribute significant cash back to shareholders. This concludes my presentation for the Q2 results, and I will now go to my final slide regarding the 2026 outlook. So during the year, we have upgraded now our financial outlook two times already and based on the accelerating growth momentum. Since our last upgrade on 29 June, we have seen performance in line with expectations, and as such, we are today confirming our outlook.

Speaker #1: And that means that, over the cycle, we will also be able to distribute significant cash back to shareholders. This concludes my presentation for the Q2 results, and I'll now go to my final slide regarding the 2026 outlook.

Speaker #1: So during the year, we have upgraded our financial outlook two times already, and based on the accelerating growth momentum since our last upgrade on the 29th of June, we have seen performance in line with expectations, and as such, we are today confirming our outlook.

Speaker #1: Our expectations for CapEx have been adjusted to an interval towards the higher end of our previous expectations, and this is mainly related to higher one-off investments in assets and installations at our Copenhagen headquarters.

Michael Bjergby: Our expectations for CapEx have been adjusted to an interval towards the high end of our previous expectations, and this is mainly related to higher one-off investments in assets and installations at our Copenhagen headquarter. So with this, I will now hand it back to Herman for final remarks.

Speaker #1: So with this, I'm now handing back to Herman for final remarks.

Speaker #2: Thank you, Michael. Yeah, we came into this year with one main goal, and that was to get back to double-digit growth. It took the better part of a year to get the business ready, and this quarter is the clearest proof yet that what we're doing is working.

Hermann Haraldsson: Thank you, Michael. Yeah, we came into this year with one main goal, and that was to get back to double-digit growth. It took the better part of a year to get the business ready. This quarter is the clearest proof yet that what we are doing is working. We did a great deal of the groundwork in 2025. We called it a transition year, a year to prepare for our next growth phase. You could think of it as kind of Boozt 3.0, and now the results are starting to show. We are selling more, discounting less, and spending our marketing budget more intelligently. It is exactly the kind of growth that we want to keep reporting, high quality, and getting more profitable as it scales. We are now building inventory ahead of the holiday season, and I believe it will be the strongest autumn-winter lineup we have prepared.

Speaker #2: We did a great deal of the groundwork in 2025. We called it a transition year—a year to prepare for our next growth phase. You could think of it as kind of Boost 3.0, and now the results are starting to show.

Speaker #2: We are selling more, discounting less, and spending our marketing budget more intelligently. It's exactly the kind of growth that we want to keep reporting—high quality, and getting more profitable as it scales.

Speaker #2: We are now building inventory ahead of the holiday season, and I believe it will be the strongest autumn-winter lineup we've prepared. Now, we're not taking anything for granted.

Hermann Haraldsson: Now, we're not taking anything for granted. The comparison base gets tougher in H2, and a good deal still depends on executing the inventory build-up well and how the consumer holds up. But with a sharper organization and the momentum we're carrying, we feel well prepared for the most important part of our year. So that concludes our presentation. Operator, will you please open up for questions?

Speaker #2: The comparison base gets tougher in the second half, and a good deal still depends on executing the inventory built up well, and how the consumer holds up.

Speaker #2: But with a sharper organization and the momentum we're carrying, we feel well prepared for the most important part of our year. So that concludes our presentation. Operator, will you please open up for questions?

Speaker #3: If you wish to ask a question, please dial pound key 5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key 6 on your telephone keypad.

Operator: If you wish to ask a question, please dial #5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial #6 on your telephone keypad. The next question comes from Johan Fred from SEB. Please go ahead.

Speaker #3: The next question comes from Johan Fred from SEB. Please go ahead.

Speaker #1: Yes, good morning, guys. Thank you for taking my questions. Starting off with the sales growth in Q2. As I read it, it was aided by improved consumer sentiment in late Q2.

Johan Fred: Yes. Good morning, guys. Thank you for taking my questions. Starting off with the sales growth in Q2. As I read it was aided by an improved consumer sentiment in late Q2. How much of the 13% constant currency growth would you say is reflecting a genuinely improved demand backdrop versus timing/comps? Has the sentiment improvement persisted into Q3? That's my first question.

Speaker #1: How much of the 13% constant currency growth would you say is reflecting a genuinely sort of improved demand backdrop versus timing/slash comps? And has the sentiment improvement persisted into Q3?

Speaker #1: That's my first question.

Speaker #2: Thank you, and good morning. It's actually a difficult question, because we see the consumer sentiment numbers in the region, and during the quarter, they didn't improve. But as you say, the consumers seem to be more optimistic, and I think that optimism has continued during the summer, so I would rather lean on the optimistic consumer than the pessimistic one.

Hermann Haraldsson: Thank you, and good morning. It's actually a difficult question because we see the consumer sentiment numbers in the region, and actually, during the quarter, that didn't improve. But as you say, the consumers seem to be more optimistic, and I think that the optimism has continued during the summer. So I would rather lean on the optimistic consumer than the pessimistic one. Having said that, I think that the growth in the quarter has to do with what we've been doing. I don't think we've been supported by more general consumer demand and more optimistic consumers. So it's been the structural changes we made. Again, somewhat easier comparisons. But again, we see probably a more optimistic consumer now than we did in the last quarter.

Speaker #2: I think, having said that, I think that the growth in the quarter has to do with what we've been doing. I don't think we've been supported by more general consumer demand and more optimistic consumers, so it's been the structural changes we've made.

Speaker #2: And again, somewhat easier comparisons. But again, we see probably a more optimistic consumer now than we did in the last quarter.

Speaker #1: Okay, got it. Thank you. A second question on sort of AOV and new customer action: customer acquisition was strong in Q2, and you also stated here in the presentation that the share of women shoppers grew percent, and also stated that customers buying from more categories also grew in Q2.

Johan Fred: Got it. Thank you. A second question on AOV and new customer acquisition. New customer acquisition was strong in Q2. You also stated here in the presentation that share of women shoppers grew 2%, and also stated that customers buying from more categories also grew in Q2, which, as you say, should imply a higher AOV. However, in Q2, AOV on Boozt.com declined year-on-year, even though we have also seen a reduction in promotional activity. Could you just help us understand the dynamics here in Q2, and what is the trajectory for the new cohorts as their spending time or as they mature, essentially?

Speaker #1: Which, as you say, should imply a higher AOV. However, in Q2, AOV on Boozt.com declined year on year, even though we've also seen a reduction in promotional activity.

Speaker #1: Could you just help us understand the dynamics here in Q2, and what's the expected trajectory for the new cohorts as sort of their spending time or, yeah, as they mature, essentially?

Speaker #2: Yes, thank you very much for the question. So, it is a good pick-up that the AOV for Boozt.com declined slightly in the quarter, whereas it increased in Booztlet.

Michael Bjergby: Yes. Thank you very much for the question. It is a good pick that the AOV for Boozt.com declined slightly in the quarter, whereas it increased in Booztlet.com. The reason for the decline is the average number of items in the basket. We actually saw a very small increase in average price in Boozt.com, but the average items per basket is down. That really is because when we had a relatively larger share of revenue on Boozt.com coming from new customers. The new customers tend to buy only a fewer items per basket when they initially engage with us, and then later on they expand to new categories, and then they also expand the number of items in the basket. So in time with higher AOV.

Speaker #2: The reason for the decline is the average number of items in the basket. So, we actually saw a very small increase in average price in Boozt.com, but the average items per basket are down.

Speaker #2: And that is because we had a relatively larger share of revenue on Boozt.com coming from new customers. And the new customers tend to buy only a few items per basket when they initially engage with us, and then later on, they expand to new categories.

Speaker #2: And then they also expand the number of items in the basket, so over time, we see a higher AOV. That is why we believe this is a one-time effect, if you like, when we get a lot of new customers coming in and a relatively higher share of revenue coming from new customers.

Michael Bjergby: That is why we believe that this is a one-time effect, if you like, when we get a lot of new customers coming in and a relatively high share of revenue coming from new customers. Then you can see a dip in the AOV, but that will increase again going forward. We do not expect that to be sustained going forward.

Speaker #2: Then you can see a dip in the AOV, but that will increase again going forward. So we don't expect that to be sustained going forward.

Speaker #2: If I can add to that, you also asked about the cohorts. It's a bit early to say about the Q2 cohorts, but we see that all the cohorts from all the years are actually increasing their spend with us this quarter.

Hermann Haraldsson: If I can add to that. You asked also about the cohorts. It is a bit early to say about the Q2 cohorts, but we see that all the cohorts from all the years are actually increasing our spend with us this quarter, and we have not seen that trend for quite a while. Basically, the cohorts are back, and that is also very positive.

Speaker #2: And we haven't seen that trend for quite a while. So, basically, the cohorts are back, and that is also very positive.

Johan Fred: And just to follow up there. When you say later on, what does that imply timing-wise? How long does it take on average for a new customer to become a returning buying across category customer?

Speaker #1: And just to follow up there, when you say "later on," what does that imply timing-wise? How long does it take on average for a new customer to become a returning, sort of buying-across-category customer?

Hermann Haraldsson: Eventually, it depends. We monitor how many are back after 3 months, 6 months, 12 months. And we always see a dip in the following year, and then they get back in. But in general, what we're following is the cohort behavior, like the '16 cohort, '17, '18, '19 cohort. And we're seeing now that they are actually increasing their spend with us again, so above index 100. And we haven't seen that actually for some years. So that's positive. And there's no reason to believe that the Q2 cohort will not behave the same way because it's the same quality, et cetera. And as Michael said, the item price increased. So I think it bodes quite well for future behavior.

Speaker #2: Yeah, that's the answer. It depends. We monitor kind of how many are back after three months, six months, twelve months, and we always see a dip in the following year.

Speaker #2: And then they get back again. But in general, what we're following is kind of the cohort behavior, like the '16 cohort, '17, '18, '19 cohort.

Speaker #2: And we're seeing now that they are actually increasing their spend with us again, so above index 100. And we haven't seen that, actually, for some years.

Speaker #2: So that's positive. And there's no reason to believe that the Q2 cohort will not behave the same way, because it's the same quality, et cetera, et cetera, et cetera.

Speaker #2: And as Michael said, the item price increased, so I think it bodes quite well for future behavior.

Speaker #1: If I may ask another question on the gross margin, the gains here was driven by better mix and reduced promotional activity in boost.com. How should we think about the sort of pricing discipline into H2, given sort of the higher volume autumn, winter season, and sort of the competitive intensity increasing, especially during Q4?

Johan Fred: If I may ask another question on the gross margin. The gains here was driven by better mix and reduced promotional activity in Boozt.com. How should we think about the pricing discipline into H2 given the higher volume autumn-winter season and the competitive intensity increasing, especially during Q4?

Speaker #2: So, this is Michael speaking, and this will always be a tactical decision that we do not decide sort of in a fixed term before we go into the season, but something that we trade accordingly.

Michael Bjergby: This is Michael speaking, and this will always be a tactical decision that we do not decide in a fixed term before we go into the season, but something where we trade accordingly. And this is the, I would say, some of the strengths with our inventory model is that we can actually change relatively fast. We have a clear ambition that we want to position our Boozt.com as our premium site. And we don't expect that there will be any significant change in the price competition if you look at it from a market perspective. So we expect what we've seen in Q2 to be sustained also in the second half.

Speaker #2: And this is the, I would say, some of the strengths with our inventory model is that we can actually change relatively fast. We have a clear ambition that we want to position our boost.com as our premium site, and we don't expect that there will be any significant change in the price competition if you look at it from a market perspective.

Speaker #2: So, we expect what we've seen in Q2 to be able to be sustained also in the second half.

Speaker #1: And so, just to clarify, you think that the pricing discipline is sustainable, and see little risk of competitive intensity pressuring margins back down in H2?

Johan Fred: Just to clarify, do you think that the pricing discipline is sustainable and see little risk for competitive intensity pressuring margins back down in H2?

Speaker #2: Yes, based on what we see right now, that's what we expect. But I would also say that we will act sort of tactically when we take decisions going into sort of the, especially the Black Friday trading and so on.

Michael Bjergby: Yes. Based on what we see right now, that's what we expect, but I would also say that we will act tactically when we take decisions going into especially the Black Friday trading and so on.

Speaker #1: Got it. Thank you. I'll get back in the queue now. Thank you so much for taking my questions.

Johan Fred: Got it. Thank you. I'll get back in the queue now. Thanks so much for taking my questions.

Speaker #2: Thank you.

Hermann Haraldsson: Thank you.

Speaker #3: The next question comes from Eric Sanstedt from Kepler Cheuvreux. Please go ahead.

Operator: The next question comes from Eric Sandsted from Kepler Cheuvreux. Please go ahead.

Speaker #4: Thanks. I just want to start off by asking about the full-year guidance. You did sales growth of 13% in Q2, and you talk about fairly good momentum.

Eric Sandsted: Thanks. I just want to start off by asking about the full-year guidance. You said it's 13% in Q2, and you talk about a fairly good momentum heading into the second half of the year and inventory ramp-up and so forth. Why does the 7% to 11% full-year guidance imply a slowdown from the Q2 growth rate? Is it just an element of conservatism here? You mentioned the comps, and so forth. Just maybe help us understand that a little bit.

Erik Sandstedt: Thanks. I just want to start off by asking about the full-year guidance. You said it's 13% in Q2, and you talk about a fairly good momentum heading into the second half of the year and inventory ramp-up and so forth. Why does the 7% to 11% full-year guidance imply a slowdown from the Q2 growth rate? Is it just an element of conservatism here? You mentioned the comps, and so forth. Just maybe help us understand that a little bit.

Speaker #4: Heading into the second half of the year, with inventory ramp-up and so forth—but why does a 7 to 11% full-year guidance imply a slowdown from the Q2 growth rate?

Speaker #4: Is that just an element of conservatism here? You mentioned the comps and so forth. Just maybe help us understand that a little bit.

Speaker #2: Yeah, it's kind of Q4 that's the main season, and with tougher comps. I believe that our guidance for the second half is somewhere between 7% and 13% growth for the full year.

Hermann Haraldsson: Yeah. Q4 is the main season, and with tougher comps. I believe that our guidance for the second half is somewhere between 7% and 13% growth full-year. Obviously, the aim is to have a double-digit growth for the full year. Our target is to be at the upper half of the range, but it's too early after June, and after July and August to start discussing, is it okay, because we don't know how the season will pan out. Of course, there's no indications that we cannot reach double-digit growth for the full year. This is what we're targeting, but it's just too early to discuss any changes to the guidance.

Speaker #2: So obviously, the aim is to have a double digit growth for the full year. So obviously, our target is to be at the upper half of the range, but it's kind of it's too early after June to end after July and August to start kind of discussing is there upgrade, because we don't know how the season will pan out.

Speaker #2: But of course, there are no indications that we cannot reach double-digit growth for the full year. So, this is what we're targeting, but it's just too early to discuss any changes to the guidance.

Speaker #4: Yeah, fair enough. Then a question on the competitive environment: could you say anything about what you're seeing? Competitors like Zalando, and the Chinese competitors Shein and so forth?

Eric Sandsted: Yeah. Fair enough. Then a question on the competitive environment. Could you say anything about what you're seeing in competitors like Zalando and the Chinese competitors, Shein and so forth, any changes in the competitive intensity and so forth?

Erik Sandstedt: Yeah. Fair enough. Then a question on the competitive environment. Could you say anything about what you're seeing in competitors like Zalando and the Chinese competitors, Shein and so forth, any changes in the competitive intensity and so forth?

Speaker #4: Any changes in the competitive intensity and so forth?

Speaker #2: I think that we are extremely competitive at the moment, probably more competitive than we have been for a long time. Due to that, we have very good control of all that is within our span of control.

Hermann Haraldsson: I think that we are extremely competitive at the moment, probably more competitive than for a long time, due to that we have very good control of all that is within our span of control. Our assortment is considerably better than before, with more choice, more options, more inspiration. Our platform is own-built, so we can act fast and utilize AI to the utmost. I think that we are very competitive. I don't think that the competition is more intense. Might be even slightly less intrusive, because I think a lot of players have challenges, I believe. I think because of our focus on what we are extremely good at, which is also why we dismissed the gifts for B2B.

Speaker #2: Our assortment is considerably better than before. We have more choice, more options, and more inspiration. Our platform is own-built, so we can act fast and utilize AI to the utmost.

Speaker #2: So I think that we are very competitive, and I don't think that the competition is more intense. It might be even slightly less intrusive, because I think a lot of players have challenges, I believe.

Speaker #2: So, I think that we are, because of our focus—focusing on what we are extremely good at—which is also why we dismissed the gift shop B2B.

Speaker #2: So I think that kind of our focus and our determination and with more inventory and with extremely strong commercial team, I think we're in a very good shape going into the second half.

Hermann Haraldsson: I think that our focus and our determination, and with more inventory and with extremely strong commercial team, I think we are in a very good shape going into H2.

Speaker #4: Perfect, thanks. And then just finally on capital allocation—with organic growth now accelerating, do you still increase the buyback rather than investing even more in the business?

Eric Sandsted: Perfect. Thanks. Then just finally on capital allocation. With organic growth now accelerating, you still increase the buyback rather than investing even more in the business. I am just a bit interested in the balance here between buybacks and reinvesting in growth.

Erik Sandstedt: Perfect. Thanks. Then just finally on capital allocation. With organic growth now accelerating, you still increase the buyback rather than investing even more in the business. I am just a bit interested in the balance here between buybacks and reinvesting in growth.

Speaker #4: I'm just a bit interested in the balance here between buybacks and reinvesting in growth.

Speaker #2: Yes, and that is a good question and something that we have to consider all the time, because having an inventory-led business model also implies that when we grow very fast, we also need to increase the inventory, and that will take up quite significant capital, and even more than the profit that we have delivered.

Michael Bjergby: Yes, that is a good question and something that we have to consider all the time, because having an inventory-led business model also implies that when we grow very fast, then we also need to increase the inventory, and that will take up quite significant capital and even more than the profit that we have delivered. But we don't want to have any excess cash on the balance sheet. So we want to be disciplined, and as you know, we don't actually expect to have much higher inventory when we end the year compared to when we started this year. At the same time, we have higher growth. So we have liquidity and a healthy balance sheet to be able to do share buybacks. But we will always prioritize to make sure that we do what is right for the long term of the business.

Speaker #2: But we don't want to have any excess cash on the balance sheet. We want to be disciplined and, as you know, we don't actually expect to have much higher inventory when we end the year compared to when we started this year.

Speaker #2: And at the same time, we have higher growth, so we have liquidity and a healthy balance sheet to be able to do share buybacks.

Speaker #2: But we will always prioritize making sure that we do what is right for the long term of the business. But we still have plenty on the balance sheet to also provide capital returns to shareholders.

Michael Bjergby: But we still have plenty of balance sheet to also provide the capital return to shareholders.

Speaker #4: Perfect. Thanks. That’s all I had.

Eric Sandsted: Perfect. Thanks. That is all I had.

Erik Sandstedt: Perfect. Thanks. That is all I had.

Speaker #2: Thank you.

Michael Bjergby: Thank you.

Speaker #3: The next question comes from Daniel Schmidt from Danske Bank. Please go ahead.

Operator: The next question comes from Daniel Schmidt from Danske Bank. Please go ahead.

Speaker #4: Yeah, good morning, Armand and Michael. A couple of questions. Starting with marketing spend as a percentage of sales—and also in absolute numbers—it came down quite a bit.

Daniel Schmidt: Yes, good morning, Herman and Michael. A couple of questions. Starting with marketing spend as a percent of sales and also in absolute numbers, came down quite a bit. You talk about deliberate shift away from offline marketing channels in favor of digital marketing. Is that sort of big leap in improving efficiency, is that going to continue in the coming quarters? When you look at last year, you also had a big improvement in Q3 and onwards. Are we meeting the changes that you already saw last year, or what is new here and what could continue?

Speaker #4: And you talk about a deliberate shift away from offline marketing channels in favor of digital marketing. Is that sort of a big leap in improving efficiency?

Speaker #4: Is that going to continue in the coming quarters? When you look at last year, you also had a big improvement in Q3 and onwards.

Speaker #4: Are we meeting the changes that you already made last year, or what's new here and what could continue?

Speaker #2: Yes, so we actually believe that we are more efficient on marketing now, but that does not mean that we will see this kind of improvement in the marketing cost ratio going into the second half.

Michael Bjergby: Yes. We actually believe that we are more efficient on marketing now. That does not mean that we will see this kind of improvement in the marketing cost rates going into H2. We see extremely strong momentum and that customers are responding right now. You should expect that the benefit from improved marketing cost rates will be smaller in H2 than it was in the H1. Because it is a good opportunity right now to grow fast, and we want to invest properly behind that.

Speaker #2: We have received extremely strong momentum, and customers are responding right now. So I would say you should expect that the sort of benefit from improved marketing cost ratio will be smaller in the second half than it was in the first half, because it is a good opportunity right now to grow fast, and we want to invest properly behind that.

Speaker #4: Okay. And a similar question on fulfillment efficiency. You write about improved distribution agreements across partners, and at the same time, you're also, of course, negatively affected by higher inbound volumes.

Daniel Schmidt: Okay. A similar question on fulfillment efficiency. You write about improved distribution agreements across partners. At the same time, you are also, of course, negatively affected by a higher inbound of volumes. Is that also going to be the case as you ramp up inventory during H2 to sell more? When you look at Q3 and Q4, how are they going to stack up against each other, you think?

Speaker #4: Is that also going to be the case as you ramp up inventory during the second half to sell more? When you look at Q3 and Q4, how do you think they are going to stack up against each other?

Speaker #2: Yes, exactly. So, within the fulfillment cost, we will always have ambitions to improve. It is when we have much higher inbound that it means something.

Michael Bjergby: Yes, exactly. Within the fulfillment cost, then we will always have ambitions to improve. When we have much higher inbound, that means something. Of course, when you sell more, you also have higher returns. So that has an impact on the fulfillment. At the same time on distribution, we have seen with the oil prices that there is a little bit of a pressure also on cost. Regardless of this, we will continue to be very strict on our targets for fulfillment and distribution cost ratios. With higher volumes, we will continue to target lower ratios and continue to see small improvements both in the fulfillment cost ratio and the distribution cost ratio.

Speaker #2: And of course, when you sell more, you also have higher returns, so that has an impact on fulfillment. At the same time, on distribution, we have seen with the oil prices that there is a little bit of pressure also on cost.

Speaker #2: But regardless of this, we will continue to be very, very strict on our targets for fulfillment and distribution cost ratios. So, with higher volumes, we will continue to target lower ratios.

Speaker #2: And continue to see small improvements, both in the fulfillment cost ratio and the distribution cost ratio.

Speaker #4: And you also talk about the temporary effect from the installation of sprinkler systems that you did during the spring. That seems to be done now.

Daniel Schmidt: You also talk about the temporary effect from the installation of sprinkler systems that you did during the spring. That seems to be done now. Was that a meaningful impact on efficiency in Q2?

Speaker #4: Was that a meaningful impact on efficiency in Q2?

Speaker #2: It had some impact. I think we managed it very well. But so I would say it will have a sort of a it had a small negative impact, but definitely it impacted how efficient you can be when you have installations like that going on.

Michael Bjergby: It had some impact. I think we managed it very well. I would say it had a small negative impact. But definitely it impacted how efficient you can be when you have installations like this that is going on.

Speaker #4: But that disruption is basically gone as we leave Q2?

Daniel Schmidt: But that disruption is basically gone as we leave Q2.

Speaker #2: Exactly. That is finalized.

Michael Bjergby: Exactly. That is finalized completely.

Daniel Schmidt: Yeah. Then just a couple of detailed questions. You closed down the B2B gift shop. What does that mean in terms of lost sales or EBIT? What is the saving on those 11 million?

Speaker #4: Yeah, yeah. And then, just a couple of detailed questions. You closed down the B2B gift shop. What does that mean in terms of lost sales or EBIT?

Speaker #4: And what is the saving on those 11 million?

Speaker #2: Yes. So all of the costs that are related to that have basically been written off. So, it wasn't an initiative that was started off.

Michael Bjergby: Well, all of the costs that are related to that is basically been written off. It was an initiative that was started off. You will see limited savings because it was an initiative that was coming up. In essence, it was a change of direction. So I would say you will see the benefit in increased sales and focus on our core business. From a sales perspective, it was actually a very good initiative, and it had some potential to also be quite profitable. In essence, it worked well, but we just needed to prioritize, to focus on what we do best, and that is our B2C core business.

Speaker #2: You will see limited savings because it was an initiative that was coming up. But we also saw, in essence, it was a change of direction.

Speaker #2: So, I would say you will see the benefit in increased sales and focus on our core business. So, from a sales perspective, it was actually a very good initiative, and it had some potential to also be quite profitable.

Speaker #2: So, in essence, it worked well, but we just needed to prioritize and focus on what we do best, and that is our B2C core business.

Speaker #4: I understand. I see your point in trying to get more out of the B2C business when you're more focused, of course. But you did have some B2B sales in Q3 and Q4 last year, I guess, which you don't have this year.

Daniel Schmidt: I understand. I see your point in trying to get more out of the B2C business when you are more focused, of course. But you did have some B2B sales in Q3 and Q4 last year, I guess, which you do not have this year. Is that a meaningful number?

Speaker #4: Is that a meaningful number?

Speaker #2: No, we didn't have any sales, so we hadn't even started the gift shop. So basically, we closed it down. We closed it down before it was operating.

Hermann Haraldsson: No, we did not have any sales.

Daniel Schmidt: Okay.

Hermann Haraldsson: We hadn't even started the gift shop.

Daniel Schmidt: Okay.

Hermann Haraldsson: So basically, we closed it down. We closed it down before it was operating. So again, as Michael said, it's a good idea. Let's just focus. So we don't lose any revenues, nothing like that. We just closed it down before it was affecting the business.

Speaker #2: So again, as Michael said, it's a good idea. Yeah. So let's just focus so we don't lose any revenues now. It's just that we closed it down before it was affecting the business.

Speaker #4: Yeah. And then I think, Mike, you also mentioned that other revenues will see a good pickup in H2. What is the visibility on that?

Daniel Schmidt: Yeah. Then I think, Mike, you also mentioned that other revenues will see a good pickup in H2. What is the visibility on that?

Speaker #2: We have a quite strong visibility because we discussed with the brands all the time. And there's no doubt that the Q1 in general was actually quite tough for the sort of trading environment in general.

Michael Bjergby: We have a quite strong visibility because we discuss with the brands all the time. There's no doubt that Q1 in general was actually quite tough for the trading environment in general, and that's why some brands hold back. Really with coming into H2, where we increase our buying budget, that implies directly that they will spend more because that's part of the agreements with them. At the same time, we see also that the general environment is improving, and that means also that they will also be more willing to do marketing investments with us. So it's constant dialogues that we have with the brands, and therefore, the visibility is quite strong.

Speaker #2: And that's why some brands hold back, and really, with coming into H2, where we increase our buying, that implies directly that they will spend more, because that's part of the agreements with them.

Speaker #2: And at the same time, we also see that the general environment is improving, and that means they will be more willing to make marketing investments with us.

Speaker #2: So, it's a sort of constant dialogue that we have with the brands, and therefore the visibility is quite strong.

Daniel Schmidt: Mike, would you say that Q3 is already in the bag in terms of agreements that you have signed?

Speaker #4: Would you say that Q3 is already in the bag, in terms of agreements that you have signed?

Speaker #2: In the bag, there's still some work to be done for September, but it is more or less solid. It's very few percentages that can change now.

Michael Bjergby: In the bag is. There's still some work to be done for September, but it is more or less solid. It's very few percentages that can change now, yes.

Speaker #2: Yes.

Speaker #4: But I guess some of it is performance-based as well, so you don't really know the outcome.

Daniel Schmidt: And I guess some of it is performance-based as well. You don't really know the outcome.

Michael Bjergby: Only to a very small extent. We will know the outcome, not now, but very close to.

Speaker #2: Only to a very, very small extent. So, we will know the outcome not now, but very close to.

Speaker #4: Okay, okay, guys. That's all from me. Thanks.

Daniel Schmidt: Okay. Okay, guys, that's all from me. Thanks.

Speaker #2: Thank you, Daniel.

Hermann Haraldsson: Thank you, Daniel.

Speaker #1: The next question comes from Nicholas Ekman from DNB Carnegie. Please go ahead.

Operator: The next question comes from Niklas Ekman from DNB Carnegie. Please go ahead.

Speaker #4: Thanks. Can I start by asking about the monthly sales trend? The main reason for asking is because you said that sales in this quarter were fairly even throughout the quarter.

Niklas Ekman: Thanks. Can I start by asking about the monthly sales trend? The main reason for asking is because you said that sales in this quarter was fairly even throughout the quarter. As I remember, in Q2 of last year, you had a decline in April, May for the first time ever, then June was back to double digits. So I'm just curious, have you seen growth rates around 13% for all months despite the big variations in comparisons from the year before?

Speaker #4: And as I remember, in Q2 of last year, you had a decline in April and May for the first time ever. Then June was back to double digits.

Speaker #4: So I'm just curious—have you seen growth rates around 13% for all months, despite the big variations in comparisons from the year before?

Michael Bjergby: No. It's not 13%, but what we did see was double-digit growth. You are right, May last year was very weak. So we did have relatively more sales in May. I would say from a momentum perspective and how it was planned out, it was fairly evenly distributed among the months and we had double-digit growth in all months.

Speaker #2: No, that is not—it’s not 13%. But what we did see was double-digit growth. But you are right, May last year was very weak.

Speaker #2: So we did have relatively low sales in May, but I would say from a momentum perspective, and how it was planned out, it was fairly evenly distributed among the months.

Speaker #2: And we had double-digit growth in all months.

Speaker #4: And also, we talked about the guidance being conservative on sales here, and kind of the same thing when you look at margins—even at the upper end of your margin.

Niklas Ekman: Okay. We also talked about the guidance being conservative on sales here. The same thing when you look at margins. Even the upper end of your margin then seems to indicate very limited margin expansion in H2, and the low end actually implies a margin contraction in H2. Is there any reason there or anything you care to elaborate on why you're being conservative?

Speaker #4: That seems to indicate very limited margin expansion in H2, and the low end actually implies margin contraction in H2. So, is there any reason there—anything you care to elaborate on—as to why you're being conservative?

Speaker #2: I think it's Q4. It depends on how that pans out. We have increased our revenue to buy, and we are allergic to stock, so it's just to be prudent.

Hermann Haraldsson: I think it's Q4. It depends on how that pans out. We have increased or even to buy, and we are allergic to stock. So it's just to be prudent. As we always say, we have the low end, meaning that if there's less demand than we expect, we need to discount more. Of course, if demand is good, consumers are optimistic, then we will be towards the high end. So Q4 is just such a big quarter that you have to be careful in expecting too much. But of course, we expect much, but we are trying to be a bit prudent.

Speaker #2: As we always say, we have the low end, meaning that if there's less demand, then we expect we need to discount more. And of course, if demand is good, consumers are optimistic, then we will be towards the high end of the so Q4 is just such a big quarter that it's like it's you have to be careful in expecting too much.

Speaker #2: But of course, we expect markets. But just as we are trying to be a bit prudent. And if you look at it from a financial and ratios perspective, then I would say we have already communicated that we expect to see an improving gross margin.

Michael Bjergby: If you look at it from a financial and ratios perspective, I would say we have already communicated that we expect to see an improvement in gross margin. So that's going to be supportive to margin H2 or H2. But we have also communicated that the admin and cost ratio will increase, so these two will be offsetting each other. The one that is still variable is, of course, the marketing cost ratio, where we will not see the same benefits as we have seen in H1 because we will invest more to make sure that we support our growth. So I think this is the key component of whether it will be in high and low end or even above the range.

Speaker #2: So that's going to be supportive to margin in Q2 or H2. But we have also communicated that the admin and cost rates will increase. So these two will be offsetting each other.

Speaker #2: And then the one that is still variable is, of course, the marketing cost ratio. We have seen that we will not see the same benefits as we saw in H1, because we will invest more to make sure that we support our goals.

Speaker #2: So I think this is really the key component of whether it will be at the high or low end, or even above the range.

Speaker #4: Fair enough. Very clear. And this question here on cash flow—we touched upon this a little bit before. In the past, your cash flow has been the strongest when growth has been the lowest.

Niklas Ekman: Fair enough. Very clear. Just a question here on cash flow. We touched upon this a little bit before here. In the past, your cash flow has been the strongest when growth has been the lowest. Now that sales growth is back, what kind of need do you see for increased investment in fulfillment and working capital as your sales are now back to double-digit growth?

Speaker #4: And now, sales growth is back. What kind of needs do you see for increased investments in fulfillment and working capital as your sales are now back to double-digit growth?

Speaker #2: We believe we are at a good revenue-to-inventory level. So that means that we believe that we have to improve increase the revenue in line with revenue the inventory in line with revenue as we move forward.

Michael Bjergby: We believe we are at a good revenue to inventory level. That means that we believe that we have to increase the inventory in line with revenue as we move forward. You can sort of model that inventory should increase as much as revenue as we move forward because that is a good level. Payables will, of course, increase also with higher inventory. Then we have discussed the H4 for some time, a new outstore, which is required at some point, but that is a bit too early to discuss that at this call. We will come back with further when we know more.

Speaker #2: So you can sort of model that inventory should increase as much as revenue as we move forward, because that is a good level. Then payables will, of course, increase also with higher inventory.

Speaker #2: Then we have discussed the AS4 for some time, a new outstore, which will be required at some point. But it's a bit too early to discuss that on this call, so we will come back with more information when we know more.

Speaker #4: Okay, but this is most likely with investments in '27 already, right?

Niklas Ekman: Okay. But this is most likely with investment in 2027 already, right?

Speaker #2: That is what we have communicated previously. Yes.

Michael Bjergby: That is what we have communicated previously, yes.

Speaker #4: Very clear. Thank you so much.

Niklas Ekman: Very clear. Thank you so much.

Speaker #2: Thank you, Nicholas.

Hermann Haraldsson: Thank you, Niklas.

Speaker #1: The next question comes from Benjamin Walstedt from ABGSC. Please go ahead.

Operator: The next question comes from Benjamin Wahlstedt from ABGSC. Please go ahead.

Speaker #4: Good morning. I will start by nitpicking some words from a previous back-and-forth with Daniel. You say we should expect a smaller benefit from marketing in the second half than in the first half.

Benjamin Wahlstedt: Good morning. I will start by sort of nitpicking some words from a previous back and forth with Daniel. You say we should expect a smaller benefit from marketing in H2 than H1, and I was wondering if you could just confirm whether or not we should expect savings from the marketing ratio in H2 at all, please.

Speaker #4: And I was wondering if you could just confirm whether or not we should expect savings from the marketing ratio in H2 at all, please.

Speaker #2: I think this is generally what we believe is possible, and long-term we believe that we can operate at a lower marketing cost ratio.

Michael Bjergby: I think this is generally what we believe that is possible. Long term, we believe that we can operate at a lower marketing cost ratio. That is the general pattern. Again, the general trend that you should expect. We do not want to guide specifically for H2 on the marketing cost ratio because of the growth momentum that we see right now. We want to make sure that we have actually room to invest if needed. We will allow ourselves to make that a little bit open and not be too firm on our guidance on marketing cost ratio exactly for H2.

Speaker #2: So that is the general pattern, and again, the general trend that you should expect. But we don't want to guide specifically for H2 on the marketing cost ratio because of the growth momentum that we see right now.

Speaker #2: We want to make sure that we actually have room to invest if needed. So we will allow ourselves to keep that a little bit open.

Speaker #2: And not be too firm on our guidance on the marketing cost ratio exactly for H2.

Speaker #4: All right. But you're not ruling it out either, I take it.

Benjamin Wahlstedt: All right. You are not ruling it out either, I take it.

Speaker #2: No. And the sort of general, long-term direction is that we can be more efficient in marketing.

Michael Bjergby: No. The sort of general long-term direction is that we can be more efficient in marketing.

Speaker #4: Perfect, thank you. I was wondering if you could expand a bit on Norway as well? Growth in Norway is quite a bit higher than the group average.

Benjamin Wahlstedt: Perfect. Thank you. I was wondering if you could expand a bit on Norway as well. Growth in Norway quite higher than the group average. Previously, you have sort of discussed the opportunity to increase the marketing push to the market since you do not pay import tariffs anymore. I was basically wondering, is this what is happening, or do you see any other concrete reason for the strong Norway performance specifically, please?

Speaker #4: Previously, you've sort of discussed the opportunity to increase the marketing push to the market since you don't—I mean, since you don't pay import tariffs, and I was basically wondering: is this what is happening, or do you see any other concrete reason for the strong Norway performance specifically, please?

Hermann Haraldsson: We are focusing more on Norway. We are not giving away the tariff savings straight away. We are more kind of granular marketing, and now also we are, as of September, strengthening our Norwegian setup. I expect that we will actually perform even better in Norway. There is a huge potential in Norway, so perhaps a bit slowly, but we are gaining momentum in Norway and getting stronger there. I think that Norway will continue to be a strong market for us because after we have the roof of tariffs, it has provided good profitability, and there is no need for us to pass the savings on to the consumer so we can keep that. That is also contributing to our profitability. Norway I expect to become even better.

Speaker #2: We are focusing more on Norway. We're not giving away the tariffs, savings, or the rate, so we are more into kind of granular marketing. And now, also, we are as of September strengthening our Norwegian setup.

Speaker #2: So I expect that we will actually perform even better in Norway. There's a huge potential in Norway, and so we are—kind of, yeah, perhaps a bit slowly—but we are gaining momentum in Norway.

Speaker #2: And getting stronger there. And I think that Norway will continue to be a strong market for us because after we have the risk of tariffs, it's providing good profitability, and there's no need for us to pass the savings on to the consumers.

Speaker #2: So we can keep that, so that's also contributing to our profitability. So Norway is, I expect, to come in even better.

Speaker #4: Perfect. Thank you. Do you still retain sort of the head start versus competitors related to the import tariffs, in your view, or are others...?

Benjamin Wahlstedt: Perfect. Thank you. Do you still retain sort of the head start versus competitors related to the import tariffs in your view, or are others?

Hermann Haraldsson: No. All our competitors, on the back of our court case, they got the listing. We took the battle, and they benefited as well. It is what it is. It is even playing grounds. If you fulfill the requirements for the VOEC, as it is called, then you do not need to pay tariffs.

Speaker #2: No, all our competitors are on the back of our court case. They got the listing. So we took the battle, and they benefited as well.

Speaker #2: But this is what it is, so it's an even playing ground. If you fulfill the requirements for the VOEC, as it's called, then you don't need to pay tariffs.

Speaker #4: Growth is not that you've gained?

Benjamin Wahlstedt: Growth is not for your. You have gained.

Hermann Haraldsson: No. Our German friends, they listed shortly after us. They always win.

Speaker #2: No, no. No, no, no, no, no, no. Our GMR friends, they listed shortly after us, so they always won.

Speaker #4: Perfect. I was wondering as well, is it possible at all to discuss the incremental sales gain from the new brands on site? Like, I understand there are obvious difficulties in terms of cannibalization and so on, but could you give us any color?

Benjamin Wahlstedt: Perfect. I was wondering as well, is it possible at all to discuss the incremental sales gain from the new brands on-site? I understand there are obvious difficulties in terms of cannibalization and so on, but could you give us any color at all on the potential growth impact from the new brands?

Speaker #4: On the potential growth impact from the new brands, please?

Speaker #2: No, it's very difficult. But what I can say is that the broader assortment comes combined with better targeting, meaning that we get the right audience into the sites.

Hermann Haraldsson: No, it is very difficult. What I can say is that the broader assortment combined with better targeting, meaning that we get the right audience into the sites and they convert better, I think that is a very good formula. The good thing is that we talked about having 55% more styles, variants live on the site, but we also sold around 55% more styles in the quarter. We cannot quantify the benefit, but it trickles down. I think that the good thing, again, is that the clicks are slightly more expensive, but as they convert better because it is the right audience and they are getting the right choice, it converts at a high conversion rate, which is a good thing. That is why it has been quite beautiful, that relation. But I cannot give you a number of how much that meant.

Speaker #2: And they convert better. I think that's a very good formula. And the good thing is that, yeah, we talked about having 55% more styles variance live on the site, but we also sold around 55% more styles.

Speaker #2: In the quarter. So we can't quantify the benefit, but it kind of trickles down. And I think that the good thing, again, is that actually the clicks are slightly more expensive, but as they convert better because it's the right audience, and they are getting the right choice.

Speaker #2: It converts better, high conversion rates, which is a good thing. That's kind of why it's been quite beautiful, that relation, right?

Speaker #2: So, I can't give you a number for how much that meant, but it's been very positive. And this is what we're continuing into the second half.

Hermann Haraldsson: It has been very positive, and this is what we are continuing into H2 with the same increase in assortment width and around more with more items. We are going strong into the quarter with momentum.

Speaker #2: With the same increase in the assortment, with around more, with more items. So we are going strongly into the quarter with inventory.

Benjamin Wahlstedt: Final one from me then. I was wondering if you could discuss the fact that your new customer generation is actually stronger than previously, simultaneously with lower marketing ratios than before. Would you say this is due to the fact that you have new brands that have a different target audience or-

Speaker #4: Final one for me, then. I was wondering if you could discuss the fact that your new customer generation is actually stronger than previously, simultaneously with lower marketing ratios than before.

Speaker #4: Would you say this is due to the fact that you have new brands that sort of have a different target audience, or?

Speaker #2: No, this is actually Benjamin. This is exactly what I was talking about: our commercial team has basically built a local country marketing team in our new headquarters.

Hermann Haraldsson: No, Benjamin, this is exactly what I was talking about, is that our commercial team, we've basically built a local country marketing team in our new headquarters. So a power team there that are much more focused on performance in the individual markets using technology to attract and target the right audience. And when they get to the site and have more assortment, then they buy more. So basically, the customers that haven't bought before and come in, they see a beautiful site with a lot of inspiration, images, good assortment, and they buy more. So this is why we went into this virtual circle by combining good assortment, AI-led inspiration, et cetera, with strong targeting.

Speaker #2: So, a power team there that are much more focused on performance in the individual markets, using technology to attract and target the right audience.

Speaker #2: And when they get to the site and see more assortment, then they buy more. So basically, the customers that haven't bought before and come in, they see a beautiful site with a lot of inspiration, images, good assortment, and they buy more.

Speaker #2: So this is kind of—this is why we went into this virtuous circle by combining good assortment, AI-led inspiration, etc., with strong targeting. So that's why we're in this kind of—we are not hesitating when we're saying that it's structurally stuff that we have done that is the main reason why we are growing this strongly for Boozt.com, 15% in the quarter.

Hermann Haraldsson: That's why we're in this. We're not hesitating when we're saying that this structure is stuff that we have done that is the main reason why we are growing this strongly for Boozt.com, 15% in the quarter. So it's this virtual circle that we just went into.

Speaker #2: So it's a, yeah, it's this virtuous circle that we've just gone into.

Speaker #4: I know you don't really, anymore.

Benjamin Wahlstedt: I know you don't really communicate the conversion rate anymore.

Hermann Haraldsson: No.

Speaker #2: Yeah.

Benjamin Wahlstedt: I guess you could backtrack it slightly, but could you say anything on the order of magnitude your conversion rate has improved?

Speaker #4: I mean, I guess you could sort of backtrack it slightly, but could you say anything like, on the order of magnitude, your conversion rate has improved?

Speaker #2: No, I'd rather not do that. But it's improved, significantly. And of course, I'm always concerned about cost. And when I hear that click cost, I'm increasing.

Hermann Haraldsson: No, I would rather not do that. It has improved significantly. I am always concerned about costs, and when I hear that click costs are increasing, that just basically means that we are buying more qualified clicks and they convert better. So that is, I think, and it is a combination of very focused staff focusing locally and we are also very good at using technology to locate the right audience at the right time with the right message. So it is actually quite beautiful for that part. Being an old media guy myself, I think it is almost beautiful to watch.

Speaker #2: But that just basically means that we are buying more qualified clicks, and they convert better. So that is, I think, a combination of very focused staff, focusing locally, and we also are very good at using technology to locate the right audience, at the right time, with the right message.

Speaker #2: So it's actually quite beautiful for that part. And, being an old media guy myself, I think it's almost beautiful to watch.

Speaker #4: Very clear. Thank you very much.

Benjamin Wahlstedt: Very clear. Thank you very much.

Hermann Haraldsson: Thanks, Benjamin.

Speaker #2: Oh, thanks, Benjamin.

Operator: There are no more questions at this time, so I hand the conference back to the speakers for any closing comments.

Speaker #1: There are no more questions at this time, so I will hand the conference back to the speakers for any closing comments.

Speaker #2: Okay, thank you for listening in, and, yeah, I guess we will see you over the next couple of weeks. I wish all of you a good day and a good weekend ahead.

Hermann Haraldsson: Okay. Thank you for listening in. I guess we will see you over the next couple of weeks. I wish all of you a good day and a good weekend ahead. Thank you.

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Q2 2026 Boozt AB Earnings Call

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