ODD · ODDITY Tech

The thesis

ODDITY Tech's third quarter beat its own guidance on every headline line, and the company raised its 2026 outlook. That supports a recovery case built on steady IL MAKIAGE repeat customers and a growing SpoiledChild. The fourth-quarter report, expected in late February 2027, shows whether the fix at its largest advertising partner holds and whether 2027 brings a return to growth.

The company reported third-quarter results on 11 November 2026. Net revenue was $145 million, down 2% from $148 million a year earlier, against guidance of a decline of about 5%. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) was $22 million, above the guided $18–20 million range. Adjusted earnings per share (EPS) came in at $0.37 against a $0.30 consensus estimate, according to Benzinga's results headline.

The full-year outlook went up. ODDITY now expects 2026 net revenue to fall about 18.5% and adjusted EBITDA of $32–34 million. Both were raised from a decline of about 19% and $30–32 million, which the company had set on 9 September 2026.

The shares closed at $19.90 on 11 November 2026, up from $19.50 the session before. The muted reaction to a beat and a raise shows the market had already priced a quarter at or above guidance after a 49.3% three-month rise. The rating is Medium because the business results now back the recovery. An advertising problem that management calls unresolved keeps the odds of beating the S&P 500 only modestly better than even.

Bullish and bearish views on ODDITY Tech Ltd.

The bull case on ODDITY Tech Ltd. (ODD), in brief: repeat customers stopped falling away. The bear case: the advertising problem is not fixed.

Bull case

• Repeat customers stopped falling away. IL MAKIAGE repeat-order revenue was stable year over year in the third quarter and made up more than 80% of net revenue, according to MarketBeat's summary of the 11 November 2026 call. In the second quarter it fell about 20%, per Earnings Whispers' 3 November 2026 preview.
• First-order losses narrowed again. First-order revenue fell by roughly the high teens in the third quarter, per the 11 November 2026 call summary. That compares with a decline of about 40% in the second quarter and about 50% in the first.
• Third straight guidance beat on profit. Third-quarter adjusted EBITDA of $22 million topped the $18–20 million range, after second-quarter adjusted EBITDA of $12.9 million beat its $8–10 million range on 9 September 2026.
• Newer brands carry growth. Management said on 11 November 2026 that SpoiledChild grew strongly in double digits in the third quarter and remains on track for at least 35% growth in 2026, approaching $350 million of revenue. METHODIQ, launched in 2026, is expected to exceed SpoiledChild's first-year revenue.
• A large cash balance. Cash and investments stood at $561 million at the third quarter, with $350 million of credit facilities undrawn, per the 11 November 2026 call. Repurchases in 2026 total 11.7 million shares for $163 million, about 20% of shares outstanding, with about $86 million left on the $200 million authorization.

Bear case

• The advertising problem is not fixed. CEO Oran Holtzman said on 11 November 2026 that the algorithm disruption at the company's largest advertising partner is still unresolved. September was the best customer-acquisition cost since 2025, but October was weaker.
• The fourth-quarter guide adds no cushion. ODDITY guided fourth-quarter sales to $135.9–137.5 million on 11 November 2026, against a $135.9 million consensus estimate, according to Benzinga's results headline. The chief financial officer (CFO) said first-order investment will be needed to support 2027 growth.
• Margins and inventory are still under strain. Third-quarter gross margin fell to 67.4% from 71.6% a year earlier, and inventory stood at $158 million, including excess IL MAKIAGE stock, per the 11 November 2026 call. The CFO expects a better inventory balance only in 2027.
• Cash generation is thin. Free cash flow was $10 million in the third quarter and about $3 million for the first nine months of 2026, per the same call summary.
• The buyback total did not grow. The company reported repurchases of 11.7 million shares for $163 million through the second quarter on 9 September 2026, and the same total through nine months on 11 November 2026.
• The CFO sold during the rally. SEC Form 4 filings show CFO Lindsay Drucker Mann sold 39,360 shares at an average $14.85 from 27 August to 31 August 2026 and 8,526 shares at an average $15.08 from 1 September to 3 September 2026, under a Rule 10b5-1 plan. Her October and November filings show only shares withheld for tax, including 22,423 shares at $21.67 on 2 November 2026.

Price setup

The shares closed at $19.90 on 11 November 2026, above the 50-day moving average of $19.59 and the 200-day moving average of $16.93 as of that close. The three-month gain is 49.3%, measured from a $13.33 close on 13 August 2026.

Before the report the shares slipped from $21.57 on 4 November 2026 to $19.50 on 10 November 2026, with a $21.70 close on 9 November 2026 in between. That close is the nearest recent high. A close above it would show buyers adding to the report-day gain.

The longer range is wide. The 52-week closing low was $9.81 on 5 June 2026. The 52-week intraday high was $46.45 on 5 December 2025, and the last close sits 57.2% below it. The 200-day average marks where the recovery would start to come into doubt. A sustained move under it would take back much of the rise that followed the second-quarter report.

Catalysts ahead

• ~24 February 2027 (est.): Q4 and full-year 2026 results, with the first 2027 outlook. Shows whether full-year adjusted EBITDA lands in the raised $32-34M range, whether IL MAKIAGE repeat orders stay stable, whether the advertising-partner disruption is resolved and whether management guides to 2027 growth.

What would change the view

A weekly close below $14.35, the 28 August 2026 close before the second-quarter report, which would erase the gain since those results; or full-year 2026 adjusted EBITDA below the $32 million low end of the raised range.

The risks this note tracks, each with what would confirm it:

• The algorithm disruption at the largest advertising partner persists and pushes customer-acquisition costs back up. Confirmed by: a Q4 first-order revenue decline wider than the roughly high-teens drop reported for Q3, or management still describing the disruption as unresolved at the Q4 report.
• IL MAKIAGE repeat customers start falling away again after a stable third quarter. Confirmed by: Q4 2026 repeat-order revenue reported down year over year.
• The raised full-year profit range is missed as the company spends on first orders for 2027. Confirmed by: full-year 2026 adjusted EBITDA reported below $32 million, or the range lowered before the Q4 report.
• Excess IL MAKIAGE inventory forces a write-down or discounting that cuts gross margin further. Confirmed by: an inventory impairment charge, year-end inventory above the $158M Q3 level, or gross margin below the Q3 67.4%.
• The 2027 return-to-growth target slips. Confirmed by: a first 2027 outlook in February 2027 that calls for lower revenue, or management moving IL MAKIAGE growth beyond 2027.
• Insider selling resumes into the price recovery. Confirmed by: new SEC Form 4 filings showing executive open-market sales at prices above the 1 September to 3 September 2026 CFO sales averaging $15.08.

What it trades with

ODDITY trades mainly on its own results. Its drivers are customer-acquisition costs at IL MAKIAGE, its dependence on one large advertising partner, and the growth of SpoiledChild and METHODIQ. Direct-to-consumer beauty and online-advertising costs are the nearest outside influences, and the broad tech indexes matter less. METHODIQ's planned 2027 move into prescription longevity treatments, which management described on 11 November 2026, adds exposure to a new category with no sales history yet.