AI-Driven Beauty Company Oddity Tech Soars 40% In Market Debut

AI-driven beauty and wellness company, Oddity Tech ODD, made a stunning debut on the public market, with its shares soaring 40% above the initial public offering (IPO) price.

CNBC reported the company reached an approximate market valuation of $2.8 billion as of midday trading on Wednesday.

Oddity, known for its Il Makiage and Spoiled Child brands, opened its stock at $49.10 per share, significantly higher than the IPO price of $35 per share set on Tuesday night.

With the sale of 12.1 million shares, Oddity and its shareholders, including private equity giant L Catterton, raised approximately $424 million.

Chart: Oddity Tech’s Market Debut

Disrupting the Beauty Market

Founded in 2018 by Oran Holtzman and his sister Shiran Holtzman-Erel, Oddity aims to revolutionize the traditional beauty market. The company uses data and artificial intelligence to develop brands and offer personalized product recommendations, replacing the in-store experience.

The company’s unique business model, which includes proprietary technology developed by a former Israeli defense official, has allowed it to grow profitably, a rarity among direct-to-consumer retailers that went public in 2021.

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Financial Performance

Oddity’s financial performance has been impressive. In the first quarter of 2023, the company reported $165.7 million in revenue, a significant increase from $90.4 million in the same period the previous year.

The company’s net income was $19.6 million, or 35 cents a share, compared to about $3 million, or 5 cents a share, a year earlier. In fiscal 2022, Oddity reported $324.5 million in sales and a net income of $21.7 million, or 39 cents a share.

Future Plans

During an interview with CNBC, co-founder and CEO Holtzman explained that the decision to take the company public is driven by his ambition to build something significant. He stated that if not for this goal, he would have considered selling the company. Holtzman also emphasized that the move to go public marks another crucial milestone in their journey.

In April, Oddity announced plans to invest over $100 million to acquire biotech startup Revela and open a U.S.-based lab. The company wants to create new molecules using AI for its cosmetics brands and future lines.

Oddity also plans to launch more brands and will use the proceeds from its offering to invest more in its data and technology and create science-backed products.

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This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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