Playboy outlines asset-light strategy and plans for new Miami Beach club as licensing revenue jumps 105%

Earnings Call Insights: Playboy, Inc. (PLBY) Q2 2025

MANAGEMENT VIEW

* CEO Ben Kohn stated that Playboy has made significant progress in its shift to a licensing-focused, asset-light business, highlighting that "the second quarter results are proof of just how far we've come." Kohn reported, "Revenue climbed 13% year-over-year, with Licensing revenue surging 105%." He also noted, "Our adjusted EBITDA was $3.5 million, a $6.4 million positive swing compared to a loss of $2.9 million in last year's second quarter."
* Kohn addressed one-time items, explaining, "Our net loss included $1.9 million in impairment charges related to the sublease of our Los Angeles office and $2.1 million related to a onetime settlement of present and future licensing agent commissions... Excluding those charges, our net loss would have been approximately $3.7 million and our earnings per share would have been negative $0.04."
* The CEO described the relaunch of Playboy Magazine and the introduction of new contests, saying, "Earlier this year, we relaunched the magazine, and our next issue is scheduled to be released in November. The landmark issue will feature 12 Playmates in 1 edition, a first in our history… We're reintroducing the Playmate of the Month and have launched the Great Playmate Search, a global paid voting contest that's already exceeded our expectations."
* Kohn announced plans to relocate headquarters to Miami Beach and develop a new Playboy Club concept, stating, "We're planning to relocate our corporate headquarters to Miami Beach... We're also developing a new Playboy Club concept there in partnership with a leading hospitality company."
* Kohn highlighted licensing progress: "Our partnership with Byborg remains a cornerstone, guaranteeing $300 million in minimum royalties over 15 years for our Digital business. And our Honey Birdette business and brand continues to improve. Q2 revenues rose 14% with gross margins expanding."
* CFO Marc B. Crossman said, "We were able to reduce our expenses moving forward at a significant discount to what we thought they would be. And so we are opportunistic in doing that this quarter to improve our results in future quarters."

OUTLOOK

* Management expressed confidence in the asset-light strategy and projected ongoing growth in both licensing and experiential businesses. Kohn stated, "I am confident that we might have the right -- we have the right strategy, the right team and the right momentum to keep building on this success."
* The company plans to continue quarterly Playmate contests, content-driven engagement, and expansion of licensing into categories like gaming, beauty, energy drinks, and fashion.
* Kohn indicated, "Experiences will become another significant revenue driver for us in the future as we expand this concept to major markets around the world."

FINANCIAL RESULTS

* Kohn reported, "Adjusted EBITDA was $3.5 million, a $6.4 million positive swing compared to a loss of $2.9 million in last year's second quarter."
* The company ended the quarter with "over $30 million in cash on hand as of today."
* Excluding $1.9 million in impairment charges and $2.1 million in settlement costs, net loss would have been approximately $3.7 million and earnings per share would have been (-$0.04).
* Incremental legal expenses of $1.3 million related to litigation impacted results. Kohn stated, "Excluding those costs, adjusted EBITDA would have been approximately $4.8 million, a positive swing of more than $7.7 million year-over-year."
* Honey Birdette reported a 14% increase in Q2 revenues with improved gross margin.

Q&A

* George Arthur Kelly, ROTH Capital, asked about the paid voting contest opportunity and registrations. Kohn replied that sign-ups were already in the "multiple thousands" and that "we signed up in the first few days more than 50% of what we were expecting for the whole entire sign-up period, which is 8 weeks."
* Kelly asked about the materiality and timing of new licensing deals. Kohn explained, "The deals that we signed on an annual basis are in excess of 7 figures, and so they're multiple-year deals."
* On the Miami hospitality venue, Kelly inquired about structure and progress. Kohn responded, "We have a space identified. We are working through plans with a partner -- an operating partner on that and also what would the programming around that be. Miami will most likely be the first, but we actually have interest in other cities as well."
* Kelly questioned the impact of the licensing commissions settlement on expenses. Crossman explained, "It obviously will bring down China. We've talked about the percentage commission that we pay."
* Alex Joseph Fuhrman, Lucid Capital, asked about Honey Birdette's growth outlook. Crossman affirmed, "We continue to expect to see growth in the back half of the year... our retail business at full price is going very strong."
* Fuhrman also sought clarity on legal expenses. Kohn said, "We can't predict when cases will be resolved. What I would say, in the second quarter, we had 2 major litigations ongoing. One of those, we are done with the litigation portion of it, but we still have 1 ongoing."

SENTIMENT ANALYSIS

* Analysts focused on growth prospects for paid voting, licensing, and the Honey Birdette brand, with a neutral to slightly positive tone and persistent questioning on the materiality of new deals and growth timelines.
* Management maintained a confident tone in prepared remarks, emphasizing strategic progress and financial improvement. In Q&A, management was occasionally cautious and deflective regarding deal specifics and legal matters, with Kohn stating, "I'm not going to answer that question because, as I've said historically, licensing is a step function..."
* Compared to the previous quarter, the tone remains confident but more assertive on the success of the asset-light model and with increased emphasis on content and experiential growth.

QUARTER-OVER-QUARTER COMPARISON

* Management's language shifted to stronger emphasis on the asset-light strategy, experiential growth, and content-driven engagement, compared to last quarter's focus on pipeline development and initial licensing wins.
* Key metrics improved: Adjusted EBITDA moved from $2.4 million in Q1 to $3.5 million in Q2 (excluding one-time items), and licensing revenue growth accelerated.
* Strategic focus expanded to include hospitality and branded experiences, with confirmation of headquarters relocation to Miami.
* Analysts' questions continued to center on licensing, Honey Birdette, and content monetization, while legal costs and new deal materiality became more prominent topics.
* Both management and analysts expressed greater confidence in the path forward, with management now able to reference successful execution on previously announced initiatives.

RISKS AND CONCERNS

* Litigation with former licensees resulted in $1.3 million in incremental legal expenses and remains ongoing for at least one major case.
* Impairment charges and commission settlements impacted net results, though management stated these actions were taken to improve future quarters.
* Management cited the need to carefully select licensing partners to avoid brand dilution, emphasizing patience and selectivity in deal-making.
* Analyst concerns included sustainability of Honey Birdette's growth, the impact of legal expenses on profitability, and the timing/materiality of new licensing deals.

FINAL TAKEAWAY

Playboy closed the second quarter of 2025 demonstrating marked progress on asset-light transformation, with licensing revenue up sharply and adjusted EBITDA swinging to a positive result. Management underscored expanded growth initiatives including headquarters relocation to Miami, a new hospitality venue, and deeper integration of content-driven brand engagement. While legal and one-time costs affected reported results, management expressed ongoing confidence in strategic direction, balance sheet strength, and the continued expansion of both licensing and experiential businesses.

Read the full Earnings Call Transcript [https://seekingalpha.com/symbol/plby/earnings/transcripts]

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