This article first appeared on GuruFocus .
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Revenue:Record revenue of $665 million for FY26, an 11% increase year-over-year.
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EBITDA:Reported EBITDA of $21.9 million, at the top end of guidance, representing a 3.3% margin; underlying EBITDA excluding unrealized FX losses was $25.9 million, a 3.9% margin.
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Delivered Margin:Ended FY26 at just over $200 million, a margin of 30.2%, consistent with the target operating range of 30% to 32%.
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Marketing Cost of Sale:Decreased from 16.3% in FY25 to 15.2% in FY26.
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Fixed Costs:Improved to 10.1% of revenue, a 50-basis-point reduction from the prior year.
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Active Customers:Reached over 1.3 million for FY26, up 5% year-on-year.
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Repeat Orders:Comprised 62% of orders in FY26, up from 59% in FY25.
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Revenue per Active Customer:Up substantially to over $490, driven by higher average order values.
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New Customer TAC:$105 for the last 12 months, lower than the same metric at December 31.
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Private Label and Exclusive Products:Represented 51% of total revenue, up from 45% last year.
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Adjacencies Revenue:Home improvement, trade & commercial, and New Zealand contributed $117 million in annual revenue, an increase of 30% on FY25.
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Home Improvement Revenue:Almost $60 million, an increase of 39% on FY25.
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Trade & Commercial Revenue:$56 million, an increase of 16% on FY25.
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New Zealand Revenue:$3 million, ahead of expectations, with the business now running at contribution breakeven.
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Operating Cash Flow:$24 million, representing over 100% of EBITDA.
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Cash Balance:Ended the full year with $123 million, a reduction of approximately $21 million on the prior year due to the on-market share buyback program.
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CapEx:Impacted by approximately $5 million in one-off setup costs for the new Melbourne facility and warehouse.
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FY27 EBITDA Target:Between $33 million and $40 million, representing approximately 50% to 80% growth on FY26.
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FY27 Depreciation and Amortization:Expected to be between $13 million and $14 million.
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FY27 Intangible CapEx:Expected to increase to a range of $5 million to $7 million.
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FY27 PP&E CapEx:Expected to be approximately $1 million.
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FY27 Trading Update:Revenue year to date is down 13%, with contribution margin dollars growing by 10% over the same period.
Release Date: August 19, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Record FY26 revenue of $665 million, up 11% year-on-year, despite a challenging consumer environment.
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EBITDA of $21.9 million was at the top end of guidance, with underlying EBITDA up 28% to $25.9 million.
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Exclusive and private label products now represent over 50% of revenue, a key strategic milestone.
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Adjacent businesses (home improvement, trade & commercial, New Zealand) grew 30% to $117 million in annual revenue.
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Strong cash position of $123 million with no debt, supporting capital management flexibility and growth investments.
Negative Points
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Revenue year-to-date in FY27 is down 13%, reflecting a deliberate focus on margins over growth in a soft market.
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Macroeconomic conditions remain uncertain and have not improved since May, pressuring consumer spending.
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Conversion rates have weakened slightly, indicating customers are taking longer to make purchase decisions.
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NPS declined to 60, partly due to the Melbourne warehouse transfer, which impacted customer experience.
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FY27 EBITDA guidance of $33-$40 million implies potential flat revenue growth, with no clear path to double-digit growth yet.
Q & A Highlights
Q: What macro conditions are factored into the FY27 EBITDA target of $33 million to $40 million, given the midpoint implies zero revenue growth? A: Susie Sugden (CEO) and Cameron Barnsley (CFO) noted that market conditions have not improved since the May update and remain uncertain. They are not guiding on revenue but expect momentum to build through the year as comps get easier and internal initiatives take effect. The Q4 run rate, which was flat year-on-year against a 20% comp, provides a sense of what FY27 could look like, demonstrating the ability to deliver strong unit economics and margins even on a flat revenue base.
Q: Can you provide an update on the $1 billion revenue target for FY28? A: Susie Sugden (CEO) stated that the goal is not $1 billion but to become the largest retailer in the category, which represents more than $2 billion in revenue. She will provide more details on plans to achieve this and return to double-digit revenue growth over the coming months.
Q: How are you balancing near-term margin optimization against protecting your value proposition, and how does this impact your ability to return to double-digit growth? A: Susie Sugden (CEO) emphasized that value, quality, and style remain core to Temple & Webster's DNA. While prices were adjusted up in some areas where they were too cheap, there are still significant opportunities for value, with portions of the range priced 20% to 40% below offline retail. Cameron Barnsley (CFO) added that the guidance range includes flexibility to go harder on growth if needed, as the Q4 run rate was ahead of the implied FY27 target ranges.
Q: Why has revenue growth gone backwards despite more efficient marketing and stable pricing, especially compared to FY24 when the company printed 25% growth despite 13 rate hikes? A: Susie Sugden (CEO) explained that while marketing efficiency has improved, they have also deliberately scaled back marketing spend, which is a big part of the revenue slowdown. The company is focused on acquiring the most valuable customer segments with the right unit economics and will increase spend again when appropriate. Cameron Barnsley (CFO) added that the current environment is quite different from four years ago.
Q: How much of the increase in exclusive products (from 49% to 54% of sales) is private label, and how big is the private label part of the business? A: Cameron Barnsley (CFO) stated that private label is still roughly 30% of revenue, having moved up slightly, while exclusive dropship makes up the balance of the 51% exclusive total. Both are growing, but exclusive dropship is still doing the heavy lifting.
Q: Given the delivered margin is running above the target range, how can you maintain this if conditions don't improve or get worse in FY27? A: Susie Sugden (CEO) expressed confidence in the FY27 forecast following Q4, noting there is flexibility in the targets. The focus remains on delivering the best range in the category through value, style, and quality. Cameron Barnsley (CFO) added that the continued mix shift toward exclusive and private label products should support margins, and there should be a small FX tailwind on the 30% of the business that is USD-denominated.
Q: How have suppliers reacted to the Q4 profit optimization initiatives? A: Susie Sugden (CEO) shared that supplier feedback has been largely supportive. Suppliers appreciated that the measures prioritize customer experience and reward well-performing suppliers with better placement on the site. This has been a positive for both the company and its customers.
Q: How much of the customer acquisition slowdown is due to proactively lifting return hurdles versus the opportunity set available with partners? A: Susie Sugden (CEO) confirmed the slowdown is deliberate, focusing on customers with the right unit economics. The company aims to diversify its marketing channels by building on brand strength and inspirational content, which should continue to improve marketing effectiveness and reduce the overall cost of sale.
Q: How should we think about the timeframe to get back to level with the prior corresponding period, given the negative sales momentum early in FY27? A: Susie Sugden (CEO) reiterated that the initial trading period is not indicative of the full year, citing the 28% growth comp and ongoing initiatives. The expectation is to finish FY27 with strong momentum leading into FY28. Cameron Barnsley (CFO) noted that Q4 was flat year-on-year against a 20% comp, which provides a sense of what FY27 could look like.
Q: Is the weakness in sales more a function of traffic, orders, or conversion? A: Cameron Barnsley (CFO) noted that conversion showed slight weakness, down to 2.9% from 3% a year before. Traffic remains okay, with people still browsing, but customers are taking more time to make decisions in the current environment. This reflects both July and the last quarter's trends.
Q: Are you ceding market share given the 13% decline in trading, and why is Temple & Webster so sensitive to the macro environment? A: Cameron Barnsley (CFO) stated that market share for FY26 was 2.9% versus 2.7% the prior year. Holding market share while increasing EBITDA 50% to 80% would be a good outcome. He clarified that the March changes were a deliberate strategy to balance profitable growth, not a reaction to macro sensitivity. The company is not highly sensitive to the macro; the initiatives were prudent given the environment.
Q: Is the falling NPS a sign that AI customer service is hurting the customer experience? A: Cameron Barnsley (CFO) attributed the NPS decline to the one-off impact of the Melbourne warehouse transfer, which took about six months and caused some disruption. Outside that period, NPS levels were stronger. He confirmed that the AI tool actually has a higher NPS score than average and is not negatively impacting the customer experience.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
