Fragrance and perfume company Inter Parfums (NASDAQ:IPAR) met Wall Street’s revenue expectations in Q2 CY2025, but sales fell by 2.4% year on year to $333.9 million. The company’s full-year revenue guidance of $1.51 billion at the midpoint came in 2.1% above analysts’ estimates. Its GAAP profit of $0.99 per share was 8.1% below analysts’ consensus estimates.
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Inter Parfums (IPAR) Q2 CY2025 Highlights:
- Revenue: $333.9 million vs analyst estimates of $334.5 million (2.4% year-on-year decline, in line)
- EPS (GAAP): $0.99 vs analyst expectations of $1.08 (8.1% miss)
- The company reconfirmed its revenue guidance for the full year of $1.51 billion at the midpoint
- EPS (GAAP) guidance for the full year is $5.35 at the midpoint, beating analyst estimates by 3.3%
- Operating Margin: 17.7%, down from 18.9% in the same quarter last year
- Market Capitalization: $3.85 billion
Company Overview
With licenses to produce colognes and perfumes under brands such as Kate Spade, Van Cleef & Arpels, and Abercrombie & Fitch, Inter Parfums (NASDAQ:IPAR) manufactures and distributes fragrances worldwide.
Revenue Growth
A company’s long-term sales performance is one signal of its overall quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years.
With $1.46 billion in revenue over the past 12 months, Inter Parfums is a small consumer staples company, which sometimes brings disadvantages compared to larger competitors benefiting from economies of scale and negotiating leverage with retailers. On the bright side, it can grow faster because it has a longer list of untapped store chains to sell into.
As you can see below, Inter Parfums’s 14.6% annualized revenue growth over the last three years was solid. This is a good starting point for our analysis because it shows Inter Parfums’s demand was higher than many consumer staples companies.
This quarter, Inter Parfums reported a rather uninspiring 2.4% year-on-year revenue decline to $333.9 million of revenue, in line with Wall Street’s estimates.
Looking ahead, sell-side analysts expect revenue to grow 4.8% over the next 12 months, a deceleration versus the last three years. This projection doesn't excite us and suggests its products will see some demand headwinds. At least the company is tracking well in other measures of financial health.
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Cash Is King
Although earnings are undoubtedly valuable for assessing company performance, we believe cash is king because you can’t use accounting profits to pay the bills.
Inter Parfums has shown robust cash profitability, driven by its attractive business model that enables it to reinvest or return capital to investors. The company’s free cash flow margin averaged 10.8% over the last two years, quite impressive for a consumer staples business.
Key Takeaways from Inter Parfums’s Q2 Results
It was great to see Inter Parfums’s full-year revenue guidance top analysts’ expectations. We were also glad its full-year EPS guidance exceeded Wall Street’s estimates. On the other hand, its EPS missed. Zooming out, we think this was a mixed quarter. The stock remained flat at $118.50 immediately after reporting.
Is Inter Parfums an attractive investment opportunity at the current price? If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here, it’s free.