Moonpig shares slide 6% after revenue miss, CEO announces exit

Moonpig Group Plc (LON:MOONM) shares dropped 6% after the online greeting card company reported fiscal year 2025 revenue at the lower end of guidance at £350 million, primarily due to softer second-half trading in its core brand, and announced CEO Nickyl Raithatha's departure. However, adjusted EBITDA for the year surpassed expectations at £96.8 million, driven by strong H2 performance. Analysts highlight that Moonpig brand's return to double-digit growth in early FY26 and an ongoing £60 million share buyback are supportive factors for earnings, with the company guiding for approximately 5% adjusted EBITDA growth in the current fiscal year.

Analysis

Moonpig Group's shares declined 6% following the release of full-year results that presented a mixed operational picture and a significant leadership change. The company reported fiscal 2025 revenue of £350 million, meeting only the lower end of its guidance due to a softer second half, where the core Moonpig brand saw an estimated 7.5% sales decline according to Jefferies. This top-line pressure was coupled with the announcement of CEO Nickyl Raithatha's departure after a seven-year tenure, introducing executive uncertainty. Despite these challenges, the company demonstrated notable profitability, delivering an adjusted EBITDA of £96.8 million, which surpassed both market consensus of £95 million and Jefferies' £95.3 million estimate. This suggests effective cost management or margin strength in the face of weaker sales. Critically, the outlook for fiscal 2026 has improved, with management reporting a return to double-digit growth for the Moonpig brand and stable performance from its Greetz arm at the start of the year. The company guides for approximately 5% adjusted EBITDA growth, supported by an ongoing £60 million share buyback program that underpins earnings growth.

Key Decisions for Investors

• Investors should weigh the recent revenue underperformance and CEO transition risk against the company's demonstrated profitability and the positive trading momentum at the start of the new fiscal year.
• It is crucial to monitor upcoming trading updates to confirm if the early FY26 return to double-digit growth in the core brand is sustainable, as this is key to validating the recovery narrative.
• The ongoing £60 million share buyback is a significant factor supporting earnings per share and should be considered a potential cushion against stock price volatility.
• The impending leadership change introduces execution risk, and investors should closely evaluate the strategic priorities of the incoming CEO once announced.