The chart below shows how CRCT performed 10 days before and after its earnings report, based on data from the past quarters. Typically, CRCT sees a +5.83% change in stock price 10 days leading up to the earnings, and a -1.01% change 10 days following the report. On the earnings day itself, the stock moves by +1.10%. This data can give you a slight idea of what to expect for the next quarter's release.
Positive
Earnings Per Share Beat: Cricut, Inc. reported an EPS of $0.06, beating expectations of $0.04.
Net Income Increase: The company achieved $62.8 million in net income for 2024, a 17% increase from 2023, marking the eighth consecutive year of positive net income.
Subscriber Growth Increase: Paid subscribers increased by 7% in 2024, reaching 2.96 million, with a notable increase of 189,000 year on year.
Cricut Machine Launch Success: The launch of the Cricut Explore 4 and Cricut Maker 4 machines, which are up to 2x faster than previous models, received positive initial feedback from retailers and users.
Gross Margin Improvement: Total gross margin improved to 44.9% in Q4 2024, up from 42% in Q4 2023, and full-year gross margin increased to 49.5%.
Operating Income Increase: Operating income for the full year increased to $76.1 million, up 9% compared to 2023, with an operating margin of 10.7%.
International Revenue Growth: International revenue increased by 3% in Q4 2024, contributing to 25% of total revenue, indicating growth in global markets.
Strong Cash Position: The company generated $265 million in cash from operations in 2024, maintaining a strong cash position with $337 million in cash and cash equivalents, remaining debt-free.
Negative
Sales Decline Trend: 7% decline in total company sales in 2024 compared to the previous year, indicating a downward trend in revenue generation.
User Engagement Decline: Engagement metrics showed continued softness, with a 0.7% decrease in active users year on year and a 3.1% decline in 90-day engaged users, suggesting challenges in user retention and engagement.
Accessories Sales Decline: Accessories and materials sales decreased by 20% for the full year, highlighting significant loss in this product category and pressure from private label brands.
Operating Income Decline Forecast: Operating income is expected to decline year on year in 2025 due to increased investments and marketing spending, which may not yield immediate returns.
Subscriber Growth Challenges: Despite a 7% increase in paid subscribers, there is a noted challenge in attracting new users and reversing weakening engagement trends, which could impact future growth.
Sales Decline Anticipation: The company anticipates total sales to decline year on year in the first half of 2025, indicating ongoing struggles in the market.
Gross Margin Decline: Gross margin from the platform decreased from 88.8% to 87.9% year on year, reflecting higher software development costs and hosting fees, which could impact profitability.
Margin Pressure Challenges: The company is facing margin pressure due to increased promotional activity and efforts to remain price competitive, which may affect overall profitability in the short term.
Cricut, Inc. (NASDAQ:CRCT) Q4 2024 Earnings Call Transcript
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