Redbubble Limited

Marketplace revenue was $220.3 million for the half. Gross profit increased 6.0% and gross margin expanded 480 basis points to 48.8%, while GPAPA increased 8.9% and GPAPA margin improved to 27.6%, up 340 basis points year over year. Operating expenses declined 4.3% year over year to $45.5 million. EBIT improved to $12.1 million from a loss of $2.2 million, a $14.3 million year-on-year turnaround. Cash at the end of January 2026 was $47.8 million, up $12.1 million from the prior year. Guidance was raised: FY26 EBIT is expected to be $6 million to $10 million, underlying cash flow is expected to be $8 million to $12 million, and GPAPA margin is expected to be 27% to 29%. Management did not provide revenue guidance.

Vivek Kumar framed the half as a clear step forward in the turnaround, emphasizing margin expansion, tighter cost control, and better execution across the marketplaces. He said the business has stabilized revenue trends and built foundations for sustainable growth through supply chain and marketing integration, AI adoption, and technology-stack consolidation. His tone was constructive and confident, but he also stressed that the company is still focused on reaccelerating revenue growth profitably.

Derek Yung emphasized the financial turnaround: gross margin of 48.8%, GPAPA margin of 27.6%, operating expenses of $45.5 million, EBIT of $12.1 million, and cash of $47.8 million. He said D&A fell 60% year over year due to a capitalization-policy change and a more streamlined approach to capitalized development costs, and he tied improved cash generation to stronger profitability and cost discipline. He also noted that some first-half OpEx items, including $1.8 million of Dashery investment and roughly $4 million of year-over-year comparison differences, should also run through the second half.

Analysts focused on whether OpEx has now stabilized and whether further savings are possible as tech stacks are integrated. Derek said the first-half OpEx comparison was distorted by Dashery investment, capitalization-policy changes, and compensation reclassification, and that normalized second-half OpEx should be lower than the reported first-half level, though he also said the roughly $4 million comparison differences will still apply in the second half. On growth and marketing, management said customer acquisition is being improved through paid marketing efficiency, SEO, and lifecycle marketing, but noted SEO has been a multi-year industry headwind and that they are not giving revenue guidance.