Brilliant Earth Group (NASDAQ:BRLT) reported higher third-quarter sales and a wider gross margin, but offered a measured holiday-season outlook as customers face tighter budgets for engagement rings.
Net sales rose approximately 2% year over year to $112.8 million, above the company’s guidance, while total orders increased approximately 6%. Adjusted EBITDA was $5.1 million, exceeding the high end of the company’s forecast.
For the full year, the jewelry retailer expects net sales to rise approximately 2.75% to 4%. It maintained its adjusted EBITDA outlook of $13 million to $15 million, citing stronger-than-expected gross margins and disciplined expense management.
Chief Financial Officer Jeff Kuo said the sales outlook reflects a more measured view of the holiday season, as budget pressures are particularly affecting engagement ring average selling prices. The company also faces comparisons with what he described as reasonably strong average selling prices in the fourth quarter of 2025.
Fine Jewelry and Bands Offset Engagement Ring Pressure
Brilliant Earth’s average order value fell approximately 3% year over year to $2,140 in the third quarter. The company attributed the decline partly to its broader assortment, including fine jewelry, which generally carries lower price points than engagement rings.
Chief Executive Officer Beth Gerstein said fine jewelry accounted for about 16% of total bookings during the quarter. Wedding and anniversary band bookings reached their highest quarterly level in company history, with growth in both men’s and women’s bands.
Engagement ring bookings declined year over year, although Gerstein said the company’s signature engagement rings outperformed. The year-earlier quarter benefited from customers accelerating purchases in anticipation of potential tariffs, she said.
Average selling prices rose year over year in fine jewelry and wedding and anniversary bands, while engagement ring average selling prices declined. Kuo said some parts of the engagement assortment showed price strength, including fancy three-stone rings and certain higher-carat-weight rings.
Early in the fourth quarter, the company has seen year-over-year order growth and continued strength in fine jewelry and wedding and anniversary bands, Gerstein said. She cautioned that most of the holiday season, typically the company’s largest fine jewelry quarter, remains ahead.
Margins Improve Despite Higher Metal Prices
Third-quarter gross margin increased to 59.7%, up approximately 210 basis points from a year earlier and 180 basis points from the second quarter. Kuo attributed the improvement primarily to pricing optimization, product design for cost efficiency and supply chain efficiencies, despite elevated metal prices.
Marketing expense declined to 23.3% of sales from 23.7% a year earlier. Total operating expense was 58% of sales, compared with 58.1% in the prior-year quarter. Adjusted operating expense, which excludes items including equity-based compensation and depreciation, rose to 55.3% of sales from 54.5%.
The company expects a gross margin in the high 50% range for the fourth quarter, an increase from its previous guidance. It also continues to anticipate full-year marketing expense leverage as a percentage of sales.
Brilliant Earth ended the third quarter with approximately $76 million in cash and no debt. Inventory was approximately $50.3 million, down about 6% from the end of the second quarter.
Showroom and Product Developments
Gerstein said showroom bookings from customers without appointments grew approximately 50% year over year, while fine jewelry bookings from walk-in customers rose approximately 37%. The company plans to open a showroom at Westfield Valley Fair in San Jose, California, for the holiday season.
Among recent product launches, Gerstein said the company’s collaboration with the Elizabeth Taylor Estate was one of its strongest fine jewelry launches and generated demand above expectations. Brilliant Earth also introduced a third chapter of its Jane Goodall Collection and a new charms collection.
About Brilliant Earth Group (NASDAQ:BRLT)
Brilliant Earth Group, Inc is a digitally focused fine jewelry company that designs and sells engagement rings, wedding bands, fine jewelry, and related accessories. Its products include natural and lab-grown diamonds, gemstones, recycled precious metals, and customizable jewelry designs.
The company operates through an e-commerce platform supported by showrooms and appointments, allowing customers to research, design, and purchase jewelry online or through in-person consultations. Brilliant Earth emphasizes product transparency and sourcing, including diamond origin information and options intended to support responsible sourcing practices.
Brilliant Earth was founded in 2005 by Beth Gerstein and Eric Grossberg and has expanded its presence across the United States through its digital platform and showroom network.
