ヨーロピアンワックスセンターの四半期報告

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2025-10-05

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 4, 2025


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to ______

Commission File Number: 001-40714

EUROPEAN WAX CENTER, INC.

(Exact Name of Registrant as Specified in its Charter)


Delaware	86-3150064
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
5830 Granite Parkway, 3rd Floor Plano, Texas	75024
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (469) 264-8123

Securities registered pursuant to Section 12(b) of the Act:

     Title of each class

     Trading
Symbol(s)

     Name of each exchange on which registered

     Class A common stock, par value $0.00001 per share

     EWCZ

     The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☒
Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of November 7, 2025, the registrant had 43,692,903 and 10,667,418 shares of Class A and Class B common stock, respectively, $0.00001 par value per share, outstanding.

Table of Contents


		Page

PART I.	FINANCIAL INFORMATION	1

Item 1.	Financial Statements (Unaudited)	1

	Condensed Consolidated Balance Sheets as of October 4, 2025 and January 4, 2025	1
	Condensed Consolidated Statements of Operations for the 13 and 39 weeks ended October 4, 2025 and October 5, 2024	2
	Condensed Consolidated Statements of Cash Flows for the 39 weeks ended October 4, 2025 and October 5, 2024	3
	Condensed Consolidated Statements of Stockholders' Equity for the 13 and 39 weeks ended October 4, 2025 and October 5, 2024	4
	Notes to Unaudited Condensed Consolidated Financial Statements	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	15
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	28
Item 4.	Controls and Procedures	29

PART II.	OTHER INFORMATION	30

Item 1.	Legal Proceedings	30
Item 1A.	Risk Factors	30
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	30
Item 3.	Defaults Upon Senior Securities	30
Item 4.	Mine Safety Disclosures	30
Item 5.	Other Information	31
Item 6.	Exhibits	32
Signatures		33

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (“Form 10-Q”) includes forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, about us and our industry that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this Form 10-Q including statements regarding our future results of operations or financial condition, business strategy and plans and objectives of management for future operations, are forward-looking statements. Words including “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “will,” or “would,” or, in each case, the negative thereof or other variations thereon or comparable terminology are intended to identify forward-looking statements. In addition, any statements or information that refer to expectations, beliefs, plans, projections, objectives, performance or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking.

These forward-looking statements are subject to a number of risks, uncertainties and assumptions. Some of the key factors that could cause actual results to differ from our expectations include, but are not limited to, the following risks related to our business: the operational and financial results of the Company’s franchisees; the ability of the Company’s franchisees to enter new markets, select appropriate sites for new centers or open new centers; the effectiveness of the Company’s marketing and advertising programs and the active participation of its franchisees in enhancing the value of its brand; the failure of its franchisees to participate in and comply with its agreements, business model and policies; the Company’s and its franchisees’ ability to attract and retain guests; the effect of social media on the Company’s reputation; the Company’s ability to compete with other industry participants and respond to market trends and changes in consumer preferences; the effect of the Company’s planned growth on its management, employees, information systems and internal controls; the Company’s ability to retain and effectively respond to a loss of key executives; recruitment efforts; a significant failure, interruptions or security breach of the Company’s computer systems or information technology; the Company and its franchisees’ ability to attract, train, and retain talented wax specialists and managers; changes in the availability or cost of labor; the Company’s ability to retain its franchisees and to maintain the quality of existing franchisees; failure of the Company’s franchisees to implement business development plans; the ability of the Company’s limited key suppliers, including international suppliers, and distribution centers to deliver their products; changes in supply costs and decreases in the Company’s product sourcing revenue, including changes due to the imposition of tariffs; the Company’s ability to adequately protect its intellectual property; the Company’s substantial indebtedness; the impact of paying some of the Company’s pre-IPO owners for certain tax benefits the Company may claim; changes in general economic and business conditions, including changes due to tariff policy and geopolitical tensions; the Company’s and its franchisees’ ability to comply with existing and future health, employment and other governmental regulations; complaints or litigation that may adversely affect the Company’s business and reputation; the seasonality of the Company’s business resulting in fluctuations in its results of operations; the impact of global crises on the Company’s operations and financial performance; the impact of inflation and rising interest rates on the Company’s business; the Company’s access to sources of liquidity and capital to finance its continued operations and growth strategy and the other important factors discussed under the caption “Risk Factors” under Item 1A in the Company’s Annual Report on Form 10-K for the year ended January 4, 2025, filed with the Securities and Exchange Commissions (the “SEC”) on March 11, 2025.

We caution investors, potential investors and others not to place undue reliance on the forward-looking statements contained in this Form 10-Q. You are encouraged to read any further disclosures we may make in our future reports to the SEC, accessible on the SEC’s website at www.sec.gov, Investors Relations section of the Company’s website at www.waxcenter.com, or otherwise. Our website and information included in or linked to our website are not part of this Form 10-Q.

These and other important factors could cause actual results to differ materially from those indicated by the forward-looking statements made in this Form 10-Q. Any forward-looking statement that the Company makes in this Form 10-Q speaks only as of the date of such statement, and we undertake no obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements, whether as a result of new information, future events or otherwise. Our business is subject to substantial risks and uncertainties, including those referenced above. Investors, potential investors, and others should give careful consideration to these risks and uncertainties.

PART I-FINANCIAL INFORMATION

Item 1. Financial Statements

EUROPEAN WAX CENTER, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share and per share amounts)

(Unaudited)


	October 4, 2025			January 4, 2025
ASSETS
Current assets:
Cash and cash equivalents	$	73,600		$	49,725
Restricted cash		6,424			6,469
Accounts receivable, net		7,089			7,283
Inventory, net		15,622			19,070
Prepaid expenses and other current assets		5,762			5,292
Total current assets		108,497			87,839
Property and equipment, net		9,774			2,313
Operating lease right-of-use assets		3,663			3,313
Intangible assets, net		417,659			432,160
Goodwill		39,112			39,112
Deferred income taxes		140,376			140,315
Other non-current assets		1,616			2,015
Total assets	$	720,697		$	707,067
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities	$	17,607		$	17,354
Long-term debt, current portion		4,000			4,000
Tax receivable agreement liability, current portion		2,908			9,353
Deferred revenue, current portion		3,818			4,149
Operating lease liabilities, current portion		1,218			1,255
Total current liabilities		29,551			36,111
Long-term debt, net		374,412			373,246
Tax receivable agreement liability, net of current portion		201,476			194,917
Deferred revenue, net of current portion		5,009			5,836
Operating lease liabilities, net of current portion		2,555			2,318
Deferred tax liability		738			738
Other long-term liabilities		2,147			2,309
Total liabilities		615,888			615,475
Commitments and contingencies (Note 7)
Stockholders’ equity:
Preferred stock ($0.00001 par value, 100,000,000 shares authorized, none issued and outstanding as of October 4, 2025 and January 4, 2025, respectively)		—			—
Class A common stock ($0.00001 par value, 600,000,000 shares authorized, 53,210,807 and 51,713,132 shares issued and 43,392,030 and 43,323,183 shares outstanding as of October 4, 2025 and January 4, 2025, respectively)		—			—
Class B common stock ($0.00001 par value, 60,000,000 shares authorized, 10,668,291 and 12,005,172 shares issued and outstanding as of October 4, 2025 and January 4, 2025, respectively)		—			—
Treasury stock, at cost 9,818,777 and 8,389,949 shares of Class A common stock as of October 4, 2025 and January 4, 2025, respectively		(86,240	)		(80,148	)
Additional paid-in capital		255,496			244,611
Accumulated deficit		(91,147	)		(100,416	)
Total stockholders’ equity attributable to European Wax Center, Inc.		78,109			64,047
Noncontrolling interests		26,700			27,545
Total stockholders’ equity		104,809			91,592
Total liabilities and stockholders’ equity	$	720,697		$	707,067

The accompanying notes are an integral part of these condensed consolidated financial statements.

EUROPEAN WAX CENTER, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except share and per share amounts)

(Unaudited)


	For the Thirteen Weeks Ended						For the Thirty-Nine Weeks Ended
	October 4, 2025			October 5, 2024			October 4, 2025		October 5, 2024
REVENUE
Product sales	$	30,606		$	31,684		$	89,992	$	95,105
Royalty fees		13,195			13,413			39,901		40,314
Marketing fees		7,574			7,603			22,885		22,841
Other revenue		2,810			2,730			8,745		8,915
Total revenue		54,185			55,430			161,523		167,175
OPERATING EXPENSES
Cost of revenue		14,476			15,003			41,927		44,551
Selling, general and administrative		13,036			17,474			42,883		43,851
Advertising		7,610			8,409			23,015		28,673
Depreciation and amortization		5,041			5,073			15,025		15,246
Loss (gain) on disposal or impairment of assets		125			(2	)		125		(83	)
Total operating expenses		40,288			45,957			122,975		132,238
Income from operations		13,897			9,473			38,548		34,937
Interest expense, net		6,520			6,340			19,747		19,043
Other (income) expense		(12	)		285			8		535
Income before income taxes		7,389			2,848			18,793		15,359
Income tax expense		2,022			818			5,463		3,751
NET INCOME	$	5,367		$	2,030		$	13,330	$	11,608
Less: net income attributable to noncontrolling interests		1,585			550			4,061		3,114
NET INCOME ATTRIBUTABLE TO EUROPEAN WAX CENTER, INC.	$	3,782		$	1,480		$	9,269	$	8,494
Net income per share
Basic - Class A Common Stock	$	0.09		$	0.03		$	0.22	$	0.18
Diluted - Class A Common Stock	$	0.09		$	0.03		$	0.22	$	0.18
Weighted average shares outstanding
Basic - Class A Common Stock		43,375,077			46,388,266			43,340,151		47,706,516
Diluted - Class A Common Stock		43,498,314			46,400,419			43,453,284		47,750,157

The accompanying notes are an integral part of these condensed consolidated financial statements.

EUROPEAN WAX CENTER, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

(Unaudited)


	For the Thirty-Nine Weeks Ended
	October 4, 2025			October 5, 2024
Cash flows from operating activities:
Net income	$	13,330		$	11,608
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		15,025			15,246
Amortization of deferred financing costs		4,425			4,171
Provision for inventory obsolescence		—			(25	)
(Recovery) provision for bad debts		(29	)		393
Deferred income taxes		5,094			3,568
Remeasurement of tax receivable agreement liability		8			535
Gain on sale of center		—			(81	)
Loss on disposal or impairment of assets		125			3
Equity compensation		5,366			4,205
Changes in assets and liabilities:
Accounts receivable		222			1,702
Inventory, net		3,448			202
Prepaid expenses and other assets		351			2,426
Accounts payable and accrued liabilities		(1	)		(1,642	)
Deferred revenue		(1,158	)		(1,683	)
Other long-term liabilities		(998	)		(678	)
Net cash provided by operating activities		45,208			39,950
Cash flows from investing activities:
Purchases of property and equipment		(2,173	)		(276	)
Cash received for sale of center		—			135
Net cash used in investing activities		(2,173	)		(141	)
Cash flows from financing activities:
Principal payments on long-term debt		(3,000	)		(3,000	)
Distributions to EWC Ventures LLC members		(3,391	)		(3,584	)
Repurchase of Class A common stock		(6,092	)		(30,147	)
Taxes on vested restricted stock units paid by withholding shares		(168	)		(549	)
Dividend equivalents to holders of EWC Ventures units		(10	)		(757	)
Payments pursuant to tax receivable agreement		(6,544	)		(6,496	)
Net cash used in financing activities		(19,205	)		(44,533	)
Net increase (decrease) in cash, cash equivalents and restricted cash		23,830			(4,724	)
Cash, cash equivalents and restricted cash, beginning of period		56,194			59,228
Cash, cash equivalents and restricted cash, end of period	$	80,024		$	54,504
Supplemental cash flow information:
Cash paid for interest	$	16,275		$	16,443
Cash paid for income taxes	$	460		$	498
Non-cash investing activities:
Property purchases included in accounts payable and accrued liabilities	$	144		$	30
Property purchases included in additional paid-in capital	$	5,667		$	—
Right-of-use assets obtained in exchange for operating lease obligations	$	1,199		$	592

The accompanying notes are an integral part of these condensed consolidated financial statements.

EUROPEAN WAX CENTER, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OFSTOCKHOLDERS’ EQUITY

(Amounts in thousands, except share and per share amounts)

(Unaudited)



											Additional
	Class A Common Stock					Class B Common Stock					paid-in			Accumulated			Treasury			Noncontrolling			Total
	Shares			Amount		Shares			Amount		capital			deficit			Stock			interest			equity
Balance at January 4, 2025		43,323,183		$	—		12,005,172		$	—	$	244,611		$	(100,416	)	$	(80,148	)	$	27,545		$	91,592
Exchange of Class B Common Stock and EWC Ventures Units for Class A Common Stock		139,626			—		(139,626	)		—		—			—			—			—			—
Vesting of restricted stock units		114,024			—		—			—		—			—			—			—			—
Shares withheld for taxes on vested restricted stock units		(30,434	)		—		—			—		(159	)		—			—			—			(159	)
Equity compensation		—			—		—			—		6,532			—			—			—			6,532
Distributions to members of EWC Ventures		—			—		—			—		—			—			—			(1,228	)		(1,228	)
Repurchase of Class A common stock		(240,573	)		—		—			—		—			—			(1,064	)		—			(1,064	)
Tax receivable liability and deferred taxes arising from share exchanges		—			—		—			—		269			—			—			—			269
Allocation of equity to noncontrolling interests		—			—		—			—		(907	)		—			—			907			—
Net income		—			—		—			—		—			1,735			—			835			2,570
Balance at April 5, 2025		43,305,826		$	—		11,865,546		$	—	$	250,346		$	(98,681	)	$	(81,212	)	$	28,059		$	98,512
Exchange of Class B Common Stock and EWC Ventures Units for Class A Common Stock		5,000			—		(5,000	)		—		—			—			—			—			—
Vesting of restricted stock units		50,574			—		—			—		—			—			—			—			—
Shares withheld for taxes on vested restricted stock units		(681	)		—		—			—		(2	)		—			—			—			(2	)
Equity compensation		—			—		—			—		3,233			—			—			—			3,233
Repurchase of Class A common stock		—			—		—			—		—			—			(383	)		—			(383	)
Distributions to members of EWC Ventures		—			—		—			—		—			—			—			(1,015	)		(1,015	)
Tax receivable liability and deferred taxes arising from share exchanges		—			—		—			—		124			—			—			—			124
Allocation of equity to noncontrolling interests		—			—		—			—		(656	)		—			—			656			—
Net income		—			—		—			—		—			3,752			—			1,641			5,393
Balance at July 5, 2025		43,360,719		$	—		11,860,546		$	—	$	253,045		$	(94,929	)	$	(81,595	)	$	29,341		$	105,862
Exchange of Class B Common Stock and EWC Ventures Units for Class A Common Stock		1,192,255			—		(1,192,255	)		—		—			—			—			—			—
Vesting of restricted stock units		28,871			—		—			—		—			—			—			—			—
Equity compensation		—			—		—			—		1,269			—			—			—			1,269
Repurchase of Class A common stock		(1,188,255	)		—		—			—		—			—			(4,645	)		—			(4,645	)
Distributions to members of EWC Ventures		—			—		—			—		—			—			—			(1,148	)		(1,148	)
Shares withheld for taxes on vested restricted stock units		(1,560	)		—		—			—		(8	)		—			—			—			(8	)
Tax receivable liability and deferred taxes arising from share exchanges		—			—		—			—		(1,888	)		—			—			—			(1,888	)
Allocation of equity to noncontrolling interests		—			—		—			—		3,078			—			—			(3,078	)		—
Net income		—			—		—			—		—			3,782			—			1,585			5,367
Balance at October 4, 2025		43,392,030		$	—		10,668,291		$	—	$	255,496		$	(91,147	)	$	(86,240	)	$	26,700		$	104,809



											Additional
	Class A Common Stock					Class B Common Stock					paid-in			Accumulated			Treasury			Noncontrolling			Total
	Shares			Amount		Shares			Amount		capital			deficit			Stock			interest			equity
Balance at January 6, 2024		48,476,981		$	—		12,278,876		$	—	$	232,902		$	(110,878	)	$	(40,000	)	$	32,979		$	115,003
Exchange of Class B Common Stock and EWC Ventures Units for Class A Common Stock		56,232			—		(56,232	)		—		—			—			—			—			—
Vesting of restricted stock units		99,023			—		—			—		—			—			—			—			—
Shares withheld for taxes on vested restricted stock units		(24,724	)		—		—			—		(319	)		—			—			—			(319	)
Forfeiture of unvested incentive units		—			—		(3,055	)		—		—			—			—			—			—
Equity compensation		—			—		—			—		1,382			—			—			—			1,382
Distributions to members of EWC Ventures		—			—		—			—		—			—			—			(1,180	)		(1,180	)
Forfeiture of accrued dividend equivalents		—			—		—			—		—			—			—			10			10
Tax receivable liability and deferred taxes arising from share exchanges		—			—		—			—		(112	)		—			—			—			(112	)
Allocation of equity to noncontrolling interests		—			—		—			—		21			—			—			(21	)		—
Net income		—			—		—			—		—			2,765			—			889			3,654
Balance at April 6, 2024		48,607,512		$	—		12,219,589		$	—	$	233,874		$	(108,113	)	$	(40,000	)	$	32,677		$	118,438
Exchange of Class B Common Stock and EWC Ventures Units for Class A Common Stock		4,744			—		(4,744	)		—		—			—			—			—			—
Vesting of restricted stock units		25,355			—		—			—		—			—			—			—			—
Shares withheld for taxes on vested restricted stock units		(6,521	)		—		—			—		(74	)		—			—			—			(74	)
Equity compensation		—			—		—			—		1,941			—			—			—			1,941
Repurchase of Class A Common Stock		(919,551	)		—		—			—		—			—			(10,001	)		—			(10,001	)
Distributions to members of EWC Ventures		—			—		—			—		—			—			—			(1,335	)		(1,335	)
Tax receivable liability and deferred taxes arising from share exchange		—			—		—			—		381			—			—			—			381
Allocation of equity to noncontrolling interests		—			—		—			—		1,149			—			—			(1,149	)		—
Net income		—			—		—			—		—			4,249			—			1,675			5,924
Balance at July 6, 2024		47,711,539		$	—		12,214,845		$	—	$	237,271		$	(103,864	)	$	(50,001	)	$	31,868		$	115,274
Exchange of Class B Common Stock and EWC Ventures Units for Class A Common Stock		22,654			—		(22,654	)		—		—			—			—			—			—
Vesting of restricted stock units		90,023			—		—			—		—			—			—			—			—
Equity compensation		—			—		—			—		882			—			—			—			882
Repurchase of Class A Common Stock		(3,057,070	)		—		—			—		—			—			(20,146	)		—			(20,146	)
Distributions to members of EWC Ventures		—			—		—			—		—			—			—			(1,069	)		(1,069	)
Shares withheld for taxes on vested restricted stock units		(19,749	)		—		—			—		(156	)		—			—			—			(156	)
Tax receivable liability and deferred taxes arising from share exchanges		—			—		—			—		1,085			—			—			—			1,085
Allocation of equity to noncontrolling interests		—			—		—			—		2,533			—			—			(2,533	)		—
Net income		—			—		—			—		—			1,480			—			550			2,030
Balance at October 5, 2024		44,747,397		$	—		12,192,191		$	—	$	241,615		$	(102,384	)	$	(70,147	)	$	28,816		$	97,900

The accompanying notes are an integral part of these condensed consolidated financial statements.

EUROPEAN WAX CENTER, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands, except share/unit and per share/unit amounts)

(Unaudited)

1. Nature of business and organization

European Wax Center, Inc. was formed as a Delaware corporation on April 1, 2021. European Wax Center, Inc. and subsidiaries (the “Company”) was formed for the purpose of completing a public offering and related transactions in order to carry on the business of EWC Ventures, LLC (“EWC Ventures”) and its subsidiaries. Through its subsidiaries, the Company is engaged in selling franchises of European Wax Center, distributing unique facial and body waxing products to franchisees which are used to perform waxing services and providing branded facial and body waxing products directly to consumers at various locations throughout the United States.

The Company operates on a fiscal calendar which, in a given year, consists of a 52 or 53 week period ending on the Saturday closest to December 31st. The quarters ended October 4, 2025 and October 5, 2024 both consisted of 13 weeks.

2. Summary of significant accounting policies

(a) Basis of presentation and consolidation

The accompanying unaudited condensed consolidated financial statements have been presented in conformity with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission and includes the operations of the Company and EWC Ventures and its wholly owned subsidiaries. EWC Ventures is considered a variable interest entity. The Company is the primary beneficiary of EWC Ventures. As a result, the Company consolidates EWC Ventures.

The condensed consolidated balance sheet as of January 4, 2025 is derived from the audited consolidated financial statements of the Company but does not include all disclosures required by GAAP. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the year ended January 4, 2025 included in our annual report on Form 10-K.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all normal recurring adjustments necessary for a fair statement of the Company’s financial position, results of operations, and cash flows for the periods presented. All intercompany accounts and transactions have been eliminated in consolidation.

Accounting policies used in the preparation of these unaudited condensed consolidated financial statements are consistent with the accounting policies described in the audited consolidated financial statements and the related notes thereto for the year ended January 4, 2025 included in our annual report on Form 10-K.

(b) Use of estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Although these estimates are based on management’s knowledge of current events and actions it may undertake in the future, they may ultimately differ from actual results. Significant areas where estimates and judgments are relied upon by management in the preparation of the financial statements include revenue recognition, provision for inventory obsolescence, income taxes, the tax receivable agreement (as amended, the “TRA”), the expected life of franchise agreements, the useful life of reacquired rights, valuation of equity-based compensation awards, and the evaluation of the recoverability of goodwill and long-lived assets, including indefinite-lived intangible assets. Actual results could differ from those estimates.

The Company is an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”) and may take advantage of reduced reporting requirements that are otherwise applicable to public companies. Section 107 of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies are required to comply with those standards. The Company has elected to use the extended transition period for complying with new or revised accounting standards. We also intend to take advantage of some of the reduced regulatory and reporting requirements of emerging growth companies pursuant to the JOBS Act so long as we qualify as an emerging growth company, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation, and exemptions from the requirements of holding non-binding advisory votes on executive compensation and golden parachute payments.

(d) Comprehensive income (loss)

Comprehensive income (loss) is defined as the change in equity (net assets) of a business entity during a period from transactions and other events and circumstances from nonowner sources. Comprehensive income (loss) is equal to net income (loss) for all periods presented.

(e) Recently issued accounting pronouncements not yet adopted

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740)—Improvements to Income Tax Disclosures, which expands disclosures in an entity’s income tax reconciliation table and regarding cash taxes paid both in the U.S. and foreign jurisdictions. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024. The adoption of this standard only impacts disclosures and is not expected to have a material impact on the Company’s consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, and in January 2025, the FASB issued ASU 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date. ASU 2024-03 requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement. ASU 2024-03, as clarified by ASU 2025-01, is effective for annual reporting periods beginning after December 15, 2026 and interim periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact that the adoption of these standards will have on its consolidated financial statements and disclosures.

In July 2025, the FASB issued ASU 2025-05, Financial Instruments (Topic 326)—Measurement of Credit Losses for Accounts Receivable and Contract Assets. ASU 2025-05 amends ASC 326-20 to provide a practical expedient and an accounting policy election related to the estimation of expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under ASC 606. ASU 2025-05 is effective for annual periods beginning after December 15, 2025, and interim reporting periods within that annual period, with early adoption permitted. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements.

In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. ASU 2025-06 modernizes the accounting for internal-use software by eliminating the traditional “development stages” framework. This update adopts a new, principles-based approach where costs are capitalized once management commits to funding and it is probable the software will be completed and used as intended. ASU 2025-06 is effective for annual periods beginning after December 15, 2027, and interim reporting periods within that annual period, with early adoption permitted. The Company is currently evaluating the impact that the adoption of this standard will have on its consolidated financial statements and disclosures.

3. Prepaid expenses and other current assets

Prepaid expenses and other current assets consisted of the following:


	October 4, 2025		January 4, 2025
Prepaid inventory	$	464	$	494
Prepaid insurance		1,697		1,139
Prepaid technology		1,595		1,908
Prepaid advertising		965		878
Prepaid commissions		305		345
Prepaid other & other current assets		736		528
Total	$	5,762	$	5,292

4. Accounts payable and accrued liabilities

Accounts payable and accrued liabilities consisted of the following:


	October 4, 2025		January 4, 2025
Accounts payable	$	4,751	$	5,615
Accrued inventory		1,379		2,248
Accrued compensation		4,410		4,630
Accrued taxes and penalties		984		1,013
Accrued technology and subscription fees		121		139
Accrued interest		1,147		1,156
Accrued professional fees		603		632
Accrued advertising		3,065		1,212
Accrued dividend equivalents		—		10
Other accrued liabilities		1,147		699
Total accounts payable and accrued liabilities	$	17,607	$	17,354

5. Long-term debt

Long-term debt consists of the following:


	October 4, 2025			January 4, 2025
Class A-2 Notes	$	387,000		$	390,000
Less: current portion		(4,000	)		(4,000	)
Total long-term debt		383,000			386,000
Less: unamortized debt discount and deferred financing costs		(8,588	)		(12,754	)
Total long-term debt, net	$	374,412		$	373,246

On April 6, 2022 (the “Closing Date”), EWC Master Issuer LLC, a limited-purpose, bankruptcy remote, indirect subsidiary of the Company (the “Master Issuer”), completed a securitization transaction pursuant to which it issued $400,000 in aggregate principal amount of Series 2022-1 5.50% Fixed Rate Senior Secured Notes, Class A-2 (the “Class A-2 Notes”).

In connection with the issuance of the Class A-2 Notes, the Master Issuer also entered into (i) a revolving financing facility that allows for the issuance of up to $40,000 in Variable Funding Notes (“Variable Funding Notes”), and certain letters of credit and (2) an advance funding facility with Bank of America, N.A. (“BofA”), whereby BofA and any other advance funding provider thereunder would, in certain specified circumstances, make certain debt service advances and collateral protection advances (not to exceed $5,000 in the aggregate). The Variable Funding Notes were undrawn as of October 4, 2025.

Fair Value

The carrying values of cash, accounts receivable and accounts payable approximate fair value because of the short-term nature of these instruments. Cash equivalents consist of money market funds for which original cost approximates fair value. Cash equivalents have an approximate fair value of $25,345 as of October 4, 2025 which was determined using Level 1 inputs. Our outstanding Class A-2 Notes had an approximate fair value of $382,666 as of October 4, 2025 which was estimated using Level 2 inputs, obtained from an independent source, and based on quoted prices for recent trades of our Class A-2 Notes.

6. Equity-Based Compensation

2025 Inducement Plan

On March 21, 2025, the board of directors of the Company (the “Board”) approved the European Wax Center, Inc. 2025 Inducement Plan (the “2025 Inducement Plan”). In accordance with Nasdaq Listing Rule 5635(c)(4), the Company did not seek approval of the 2025 Inducement Plan by its stockholders. Pursuant to the Inducement Plan, the Company may grant nonqualified stock options, stock appreciation rights, restricted stock units and certain other stock-based awards for up to a total of 4,000,000 shares of Class A Common Stock of the Company, par value $0.00001 per share, to employees entering into employment or returning to employment after a bona fide period of non-employment with the Company.

Restricted Stock Units

During the 13 and 39 weeks ended October 4, 2025, we granted 22,530 and 1,907,151 restricted stock units (“RSUs”), respectively, to certain employees and directors under the 2021 Omnibus Incentive Plan (the “2021 Incentive Plan”). In addition, during the 13 and 39 weeks ended October 4, 2025, we granted 220,000 and 664,000 RSUs, respectively, to certain employees under the 2025 Inducement Plan. During the 13 and 39 weeks ended October 5, 2024, we granted 92,904 and 491,571 RSUs, respectively, to certain employees and directors under the 2021 Incentive Plan. The RSUs granted generally vest on the anniversaries of the date of grant over a period of two to four years, subject in all cases to continued employment on the applicable vesting date. The total grant date fair value of the RSUs will be recognized as equity-based compensation expense over the vesting period. The weighted average grant date fair values of the RSUs granted during the 13 and 39 weeks ended October 4, 2025 were $4.67 and $4.91, respectively. The weighted average grant date fair values of the RSUs granted during the 13 and 39 weeks ended October 5, 2024 were $5.57 and $12.73 respectively. The weighted average grant date fair values of the RSUs granted were equal to the closing price of the underlying Class A common stock on the grant dates.

Class A Common Stock Options

During the 39 weeks ended October 4, 2025, we granted 1,767,187 options to certain employees under the 2021 Incentive Plan. There were no options granted under the 2021 Incentive Plan during the 13 weeks ended October 4, 2025. In addition, during the 13 and 39 weeks ended October 4, 2025, we granted 815,000 and 2,450,000 options, respectively, to certain employees under the 2025 Inducement Plan. The weighted average exercise prices of options granted during the 13 and 39 weeks ended October 4, 2025 were $8.03 and $8.05 per share, respectively. During the 13 and 39 weeks ended October 5, 2024, we granted 1,000,000 and 1,326,326 options, respectively, to certain employees under the 2021 Incentive Plan. The weighted average exercise prices of options granted during the 13 and 39 weeks ended October 5, 2024 were $9.53 and $11.49 per share, respectively. The options granted have a ten-year contractual term and will cliff vest on either the third or fourth anniversary of the grant date, subject in all cases to continued employment on the applicable vesting date. The weighted average grant date fair values of the options were $2.72 and $3.08 for the 13 and 39 weeks ended October 4, 2025, respectively, and $2.68 and $4.06 for the 13 and 39 weeks ended October 5, 2024, respectively. The total grant date fair value of the stock options will be recognized as equity-based compensation expense over the vesting period. As these options were granted with exercise prices 20% higher than the closing price, it was determined that the options contained an implicit market condition. As such, the Company estimated the fair value of the options using a trinomial lattice model.

The following table presents the weighted average assumptions used in the lattice model to determine the fair value of the options granted during the 13 and 39 weeks ended October 4, 2025 and October 5, 2024:


	For the Thirteen Weeks Ended						For the Thirty-Nine Weeks Ended
	October 4, 2025			October 5, 2024			October 4, 2025			October 5, 2024
Expected dividend yield		0.0	%		0.0	%		0.0	%		0.0	%
Expected volatility		63.0	%		60.0	%		67.0	%		59.0	%
Risk-free rate		4.0	%		3.8	%		4.2	%		3.9	%
Suboptimal exercise factor	2.5x			2.5x			2.5x			2.5x

A description of each of the inputs to the lattice model is as follows:

•

Expected dividend yield - The expected dividend yield is based on our history of not paying regular dividends in the past and our current intention to not pay regular dividends in the foreseeable future. An increase in the expected dividend yield would decrease compensation expense.

•

Expected volatility - This is a measure of the amount by which the price of the equity instrument has fluctuated or is expected to fluctuate. The expected volatility was based on the historical volatility of the Company as well as that of a group of guideline companies. An increase in expected volatility would increase compensation expense.

•

Risk-free interest rate - This is the U.S. Treasury rate as of the measurement date having a term approximating the contractual term of the award. An increase in the risk-free interest rate would increase compensation expense.

•

Suboptimal exercise factor - The multiple of the exercise price at which an option exercise would be expected to occur. An increase in the suboptimal exercise factor would increase compensation expense.

7. Commitments and contingencies

Litigation

On July 1, 2025, a class-action lawsuit captioned Sydney Dunn v. European Wax Center, Inc. was filed in the United States District Court for the Northern District of California against the Company by a putative class representing users who booked a reservation on the Company’s website, asserting various privacy-related claims stemming from the Company’s purported use of digital tracking technologies on its website. While we anticipate a loss is probable in this matter, we also anticipate an insurance loss recovery is probable. Consequently, we have accrued an estimated loss and a corresponding insurance receivable, net of the policy’s deductible. Because the litigation is in its early stages, the actual loss could vary from our current estimate; however, we do not believe the loss would exceed our insurance policy’s $5,000 coverage limits. Accordingly, we do not expect the impact to our Condensed Consolidated Statement of Operations to exceed the policy’s $250 deductible, which we have recorded in Selling, general and administrative during the 13 weeks ended October 4, 2025.

In addition, the Company is exposed to various asserted and unasserted potential claims encountered in the normal course of business. Although the outcomes of potential legal proceedings are inherently difficult to predict, the Company does not expect the resolution of these occasional legal proceedings to have a material effect on its financial position, results of operations, or cash flows.

8. Revenue from contracts with customers

Contract liabilities consist of deferred revenue resulting from franchise fees, which are generally recognized on a straight-line basis over the term of the underlying franchise agreement. Also included are service revenues from corporate-owned centers, including customer prepayments in connection with the Wax Pass program. Contract liabilities are classified as deferred revenue on the condensed consolidated balance sheets.

Deferred franchise fees are reduced as fees are recognized in revenue over the term of the franchise license for the respective center. Deferred service revenues are recognized over time as the services are performed. The following table reflects the change in contract liabilities for the periods indicated:


	Contract liabilities
Balance at January 4, 2025	$	9,985
Revenue recognized that was included in the contract liability at the beginning of the year		(2,637	)
Increase, excluding amounts recognized as revenue during the period		1,479
Balance at October 4, 2025	$	8,827

During the 13 and 39 weeks ended October 4, 2025, the Company recognized $771 and $2,637, respectively, in revenue that was included in the contract liability as of January 4, 2025. During the 13 and 39 weeks ended October 5, 2024, the Company recognized $888 and $3,932, respectively, in revenue that was included in the contract liability as of January 6, 2024.

The weighted average remaining amortization period for deferred revenue is 3.4 years.

The following table illustrates estimated revenues expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of October 4, 2025. The Company has elected to exclude short term contracts, sales-based royalties and any other variable consideration recognized on an “as invoiced” basis.


Contract liabilities to be recognized in:	Amount
2025 (from October 5, 2025)	$	2,959
2026		1,136
2027		1,089
2028		1,049
2029		859
Thereafter		1,735
Total	$	8,827

The summary set forth below represents the balances in deferred revenue as of October 4, 2025 and January 4, 2025:


	October 4, 2025		January 4, 2025
Franchise fees	$	6,165	$	7,053
Service revenue		2,662		2,932
Total deferred revenue		8,827		9,985
Long-term portion of deferred revenue		5,009		5,836
Current portion of deferred revenue	$	3,818	$	4,149

9. Income taxes

The Company is subject to U.S. federal income taxes, in addition to state and local income taxes, with respect to its allocable share of any taxable income or loss of EWC Ventures. The remaining share of EWC Ventures income or loss is non-taxable to the Company and is not reflected in current or deferred income taxes.

EWC Ventures is a limited liability company that is treated as a partnership for U.S. federal income tax purposes and for most applicable state and local income tax purposes. As a partnership, EWC Ventures is not subject to U.S. federal and certain state and local income taxes. For U.S. federal and certain state and local income taxes, taxable income or loss generated by EWC Ventures is passed through to its members and included in the taxable income or loss of its members on a pro rata basis, subject to applicable tax regulations.

We recorded $2,022 and $5,463 in income tax expense for the 13 and 39 weeks ended October 4, 2025, respectively, and $818 and $3,751 in income tax expense for the 13 and 39 weeks ended October 5, 2024, respectively. The effective tax rate was 27.4% and 29.1% for the 13 and 39 weeks ended October 4, 2025, respectively, and 28.7% and 24.4% for the 13 and 39 weeks ended October 5, 2024, respectively. The effective tax rate for the 13 and 39 weeks ended October 4, 2025 differs from the U.S. federal statutory rate primarily due to nondeductible officer compensation, non-taxable income attributable to noncontrolling interest, state taxes and the tax effects of stock compensation. The effective tax rate for the 13 and 39 weeks ended October 5, 2024 differs from the U.S. federal statutory rate primarily due to non-taxable income attributable to noncontrolling interest, state taxes and the tax effects of stock compensation.

The One Big Beautiful Bill Act

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted into law in the United States which permanently extends select expiring provisions of the Tax Cuts and Jobs Act. The OBBBA includes provisions related to accelerated fixed asset depreciation under section 168(k), changes to interest expense limitations under 163(j) and changes to deductibility of compensation under section 162(m). We’ve considered the impact of the OBBBA on the Company’s annual effective tax rate. The changes did not have a significant impact to the annual effective tax rate, and we will continue to evaluate.

Tax Receivable Agreement

As of October 4, 2025, future payments under the TRA are expected to be $204,384. Payments made under the TRA represent payments that otherwise would have been made to taxing authorities in the absence of attributes obtained by us as a result of exchanges by our pre-IPO members. Such amounts will be paid only when a cash tax savings is realized as a result of attributes subject to the TRA. That is, payments under the TRA are only expected to be made in periods following the filing of a tax return in which we are able to utilize certain tax benefits to reduce our cash taxes paid to a taxing authority. The impact of any changes in the projected obligations under the TRA as a result of changes in the geographic mix of the Company’s earnings, changes in tax legislation and tax rates or other factors that may impact the Company’s tax savings will be reflected in other expense on the condensed consolidated statement of operations in the period in which the change occurs.

10. Noncontrolling interests

We are the sole managing member of EWC Ventures and, as a result of this control, and because we have a substantial financial interest in EWC Ventures, we consolidate the financial results of EWC Ventures. We report noncontrolling interests representing the economic interests in EWC Ventures held by the other members of EWC Ventures. Income or loss is attributed to the noncontrolling interests based on their contractual distribution rights, and the relative percentages of EWC Ventures non-voting common units (“EWC Ventures Units”) by us and the other holders of EWC Ventures Units during the period.

The EWC Ventures LLC Agreement permits the members of EWC Ventures to exchange EWC Ventures Units, together with related shares of our Class B common stock, for shares of our Class A common stock on a one-for-one basis or, at the election of the Company, for cash at the current fair value on the date of the exchange.

Changes in the Company’s ownership interest in EWC Ventures while retaining control of EWC Ventures will be accounted for as equity transactions. As such, future redemptions or direct exchanges of EWC Ventures Units by the other members will result in a change in ownership and reduce the amount recorded as noncontrolling interest and increase additional paid-in capital. As of October 4, 2025, all EWC Ventures Units have vested.

The following table summarizes the ownership of EWC Ventures as of October 4, 2025:


	October 4, 2025
	Units Owned		Ownership Percentage
European Wax Center, Inc.		43,392,030		80.3	%
Noncontrolling interests		10,668,291		19.7	%
Total		54,060,321		100.0	%

The following table presents the effect of changes in the Company’s ownership interest in EWC Ventures on the Company’s equity for the 13 and 39 weeks ended October 4, 2025 and October 5, 2024:


	For the Thirteen Weeks Ended				For the Thirty-Nine Weeks Ended
	October 4, 2025		October 5, 2024		October 4, 2025		October 5, 2024
Net income attributable to European Wax Center, Inc.	$	3,782	$	1,480	$	9,269	$	8,494
Transfers from noncontrolling interests:
Increase in additional-paid-in-capital as a result of equity allocations from the noncontrolling interest		3,078		2,533		1,515		3,703
Net increase in equity of European Wax Center, Inc. due to equity interest transactions with noncontrolling interests	$	6,860	$	4,013	$	10,784	$	12,197

11. Net income per share

Basic net income per share of Class A common stock is computed by dividing net income attributable to Class A common shareholders for the period by the weighted average number of shares of Class A common stock outstanding for the same period. Shares issued during the period and shares reacquired during the period are weighted for the portion of the period in which the shares were outstanding. Diluted net income per share of Class A common stock is computed by dividing net income attributable to Class A common shareholders by the weighted-average number of shares of Class A common stock outstanding adjusted to give effect to potentially dilutive securities using the more dilutive of either the treasury stock method or the if-converted method.

The following table sets forth the computation of basic net income per share of Class A common stock for the 13 and 39 weeks ended October 4, 2025 and October 5, 2024:


	For the Thirteen Weeks Ended				For the Thirty-Nine Weeks Ended
	October 4, 2025		October 5, 2024		October 4, 2025		October 5, 2024
(in thousands, except for share and per share amounts)
Net income	$	5,367	$	2,030	$	13,330	$	11,608
Less: net income attributable to noncontrolling interests		1,512		634		3,897		3,156
Net income applicable to Class A common shareholders	$	3,855	$	1,396	$	9,433	$	8,452
Basic weighted average outstanding shares
Class A Common Stock		43,375,077		46,388,266		43,340,151		47,706,516
Basic net income per share applicable to common shareholders:
Class A Common Stock	$	0.09	$	0.03	$	0.22	$	0.18

The following table sets forth the computation of diluted net income per share of Class A common stock for the 13 and 39 weeks ended October 4, 2025 and October 5, 2024:


	For the Thirteen Weeks Ended				For the Thirty-Nine Weeks Ended
	October 4, 2025		October 5, 2024		October 4, 2025		October 5, 2024
(in thousands, except for share and per share amounts)
Net income	$	5,367	$	2,030	$	13,330	$	11,608
Less: net income attributable to noncontrolling interests		1,509		634		3,889		3,154
Net income applicable to Class A common shareholders	$	3,858	$	1,396	$	9,441	$	8,454
Diluted weighted average outstanding shares
Basic weighted average outstanding shares - Class A Common Stock		43,375,077		46,388,266		43,340,151		47,706,516
Effect of dilutive securities:
RSUs and Restricted Shares		123,237		10,139		113,063		42,970
Options		—		2,014		70		671
Diluted weighted average outstanding shares - Class A Common Stock		43,498,314		46,400,419		43,453,284		47,750,157
Diluted net income per share applicable to common shareholders:
Class A Common Stock	$	0.09	$	0.03	$	0.22	$	0.18

For the 13 and 39 weeks ended October 4, 2025, diluted net income per share of Class A common stock was calculated using the treasury stock method. For the 13 and 39 weeks ended October 5, 2024, diluted net income per share of Class A common stock was calculated using the treasury stock method.

Shares of Class B common stock do not share in the earnings or losses attributable to the Company and are therefore not participating securities. As such, separate presentation of basic and diluted net income per share of Class B common stock under the two-class method has not been presented. Shares of Class B common stock are, however, considered potentially dilutive shares of Class A common stock because shares of Class B common stock, together with the related EWC Ventures Units, are exchangeable into shares of Class A common stock on a one-for-one basis.

The following table sets forth the securities which were excluded from the computation of diluted net income per share of Class A common stock for the 13 and 39 weeks ended October 4, 2025 and October 5, 2024 as they were determined to be antidilutive:


	For the Thirteen Weeks Ended				For the Thirty-Nine Weeks Ended
	October 4, 2025		October 5, 2024		October 4, 2025		October 5, 2024
Antidilutive securities excluded from the computation of diluted net income per share:
Class B Common Stock		10,668,291		12,192,191		10,668,291		12,192,191
Options		4,783,530		1,047,767		4,473,530		1,047,767
RSUs and Restricted Shares		208,016		532,560		208,016		384,360
Warrants		2,730,000		—		2,730,000		—

12. Stockholders’ equity

Share Exchange Transactions

During the 13 and 39 weeks ended October 4, 2025 certain members of EWC Ventures exercised their exchange rights and exchanged 1,192,255 and 1,336,881 EWC Ventures Units and the corresponding shares of Class B common stock, respectively, for 1,192,255 and 1,336,881 newly issued shares of Class A common stock, respectively. During the 13 and 39 weeks ended October 5, 2024 certain members of EWC Ventures exercised their exchange rights and exchanged 22,654 and 83,630 EWC Ventures Units and the corresponding shares of Class B common stock, respectively, for 22,654 and 83,630 newly issued shares of Class A common stock, respectively. These exchange transactions increased the Company’s ownership interest in EWC Ventures.

Share Repurchases

During the 13 weeks ended October 4, 2025, the Company repurchased 1,188,255 shares of Class A common stock at an average price of $3.91 per share for $4,645 pursuant to the stock repurchase program authorized by the Board in May 2024. During the 39 weeks ended October 4, 2025, the Company repurchased 1,428,828 shares of Class A common stock at an average price of $4.00 per share for $5,709, including broker commission. Additionally, the Company paid $383 in excise tax pursuant to the Inflation Reduction Act of 2022 for the net shares repurchased during fiscal 2024.

During the 13 weeks ended October 5, 2024, the Company repurchased 3,057,070 shares of Class A common stock at an average price of $6.59 per share for $20,146, including broker commissions, pursuant to the stock repurchase program authorized by the Board in May 2024. During the 39 weeks ended October 5, 2024, the Company repurchased 3,976,621 shares of Class A common stock at an average price of $7.58 per share for $30,147.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion of our historical performance, financial condition and future prospects in conjunction with the management’s discussion and analysis of financial conditions and results of operations and the audited consolidated financial statements included in our annual report on Form 10-K for the fiscal year ended January 4, 2025. The following discussion and analysis should also be read in conjunction with our unaudited condensed consolidated financial statements and the notes thereto included elsewhere in this quarterly report on Form 10-Q. This discussion contains forward-looking statements that are based on the views and beliefs of our management, as well as assumptions and estimates made by our management. Actual results could differ materially from such forward-looking statements as a result of various risk factors, including those that may not be in the control of management. For further information on items that could impact our future operating performance or financial condition, see Part I, “Item 1A. Risk Factors” included in our annual report on Form 10-K for the fiscal year ended January 4, 2025 and “Cautionary Note Regarding Forward-Looking Statements” included in this quarterly report on Form 10-Q.

We conduct substantially all of our activities through our subsidiary, EWC Ventures, LLC and its subsidiaries. We operate on a fiscal calendar widely used by the retail industry that results in a given fiscal year consisting of a 52- or 53-week period ending on the Saturday closest to December 31. Our fiscal quarters are composed of 13 weeks each, except for 53-week fiscal years for which the fourth quarter will be composed of 14 weeks.

Overview

We are the leading franchisor and operator of out-of-home (“OOH”) waxing services in the United States. We delivered over 23 million waxing services in both 2024 and 2023. Throughout our highly franchised network, we generated system-wide sales of $951 million in fiscal 2024, which consisted of only 52 weeks. We generated system-wide sales of $955 million in fiscal 2023, which had 53 weeks. Our portfolio of centers operate in 1,053 locations across 44 states as of October 4, 2025. Of these locations, 1,048 are franchised centers operated by franchisees and five are corporate-owned centers.

We believe that the European Wax Center brand is trusted, efficacious and accessible. Our culture is obsessed with our guest experience and we deliver a superior guest experience relative to smaller chains and independent salons. We offer guests high-quality, hygienic waxing services administered by our licensed, EWC-trained estheticians (our “wax specialists”), at our accessible and welcoming locations (our “centers”). Our technology-enabled guest interface simplifies and streamlines the guest experience with automated appointment scheduling and remote check-in capabilities, with a goal of making guest visits convenient, hassle-free, and consistent across our network of centers. Our well-known, pre-paid Wax Pass program makes payment easy and convenient, fostering loyalty and return visits. Many of our loyal guests view us as a non-discretionary part of their personal-care and beauty regimens.

We believe that our asset-light franchise platform delivers capital-efficient growth with strong cash flow generation. Our centers are 99% owned and operated by our franchisees who benefit from strong unit-level economics, with mature centers generating annual cash-on-cash returns in excess of 40%.

In partnership with our franchisees, we fiercely protect our points of differentiation that attract new guests, build meaningful relationships and promote lasting retention.

Hair removal is an integral and recurring part of the personal-care and beauty regimens for most women and many men in the United States, and hair removal solutions are consistently in demand, given the recurring nature of hair growth.

Under the stewardship of our CEO and the other management team members, we have prioritized building a culture of performance, success and inclusivity. Additionally, we have intensified our focus on enhancing the guest experience and have invested significantly in our corporate infrastructure and marketing capabilities.

Growth Strategy and Outlook

We plan to grow our business over the long-term primarily by opening new franchised centers as well as increasing our system-wide sales in existing centers. We believe that we have a meaningful whitespace opportunity to support our long-term growth plan for our center format across the United States.

However, the outlook on the consumer environment remains uncertain, and many of our centers across the network have been experiencing declining transactions and profitability. In the near-term, many franchisees have paused their new center growth plans as we work to stabilize and realign the business to increase transactions and profitability at existing locations. There will be more center closures in 2025 than new center openings.

We are in the early stages of our transformation to further strengthen the foundation of the business and position the Company for sustainable growth. During this transitional year, we are implementing new tools, investing in our capabilities and refining our strategic approach to the market. We recently rounded out our management team by hiring a Chief Operating Officer and a Chief Development Officer.

With this expanded leadership team in place, we believe we are better positioned to advance our strategic objectives including (1) driving traffic and sales growth; (2) improving four-wall profitability for our franchisees; and (3) pursuing thoughtful, profitable expansion. We believe we are on track to return to positive net center growth by the end of 2026.

Key Business Metrics

We track the following key business metrics to evaluate our performance, identify trends, formulate financial projections, and make strategic decisions. Accordingly, we believe that these key business metrics provide useful information to investors and others in understanding and evaluating our results of operations in the same manner as our management team. These key business metrics are presented for supplemental information purposes only, should not be considered a substitute for financial information presented in accordance with GAAP, and may be different from similarly titled metrics or measures presented by other companies.

Number of Centers. Number of centers reflects the number of franchised and corporate-owned centers open at the end of the reporting period. We review the number of new center openings, the number of closed centers and the number of relocations of centers to assess net new center growth, and drivers of trends in system-wide sales, royalty and franchise fee revenue and corporate-owned center sales.

System-Wide Sales. System-wide sales represent sales from same day services, retail sales and cash collected from wax passes for all centers in our network, including both franchisee-owned and corporate-owned centers. While we do not record franchised center sales as revenue, our royalty revenue is calculated based on a percentage of franchised center sales, which are 6.0% of sales, net of retail product sales, as defined in the franchise agreement. This measure allows us to better assess changes in our royalty revenue, our overall center performance, the health of our brand and the strength of our market position relative to competitors. System-wide sales growth is typically driven by net new center openings as well as increases in same-store sales, whereas system-wide sales decline is typically driven by net center closures as well as decreases in same-store sales. System-wide sales of $238.2 million in the 13 weeks ended October 4, 2025 decreased 0.8% from $240.2 million in the 13 weeks ended October 5, 2024, primarily driven by a decrease in same day services and retail sales, partially offset by an increase in cash collected from wax pass sales. System-wide sales of $721.7 million in the 39 weeks ended October 4, 2025 was flat compared to the 39 weeks ended October 5, 2024, primarily driven by a decrease in same day services and retail sales that was fully offset by an increase in cash collected from wax pass sales.

Same-Store Sales. Same-store sales reflect the change in year-over-year sales from services performed and retail sales for the same-store base. We define the same-store base to include those centers open for at least 52 full weeks. If a center is closed for greater than six consecutive days, the center is deemed a closed center and is excluded from the calculation of same-store sales until it has been reopened for a continuous 52 full weeks. This measure highlights the performance of existing centers, while excluding the impact of net new center (closures) openings. We review same-store sales for corporate-owned centers as well as franchisee-owned centers. Same-store sales growth is typically driven by increases in the number of transactions and average transaction size, whereas same-store sales decline is typically driven by decreases in the number of transactions and average transaction size. Same-store sales of 0.2% for the 13 weeks ended October 4, 2025 was primarily due to an increase in the average transaction size, and was partially offset by a decrease in the number of transactions. Same-store sales of 0.4% for the 39 weeks ended October 4, 2025 was primarily due to an increase in the average transaction size and was partially offset by a decrease in the number of transactions.

Net New Center (Closures) Openings. The number of net new center (closures) openings reflects centers opened during a particular reporting period for both franchisee-owned and corporate-owned centers, less centers closed during the same period. Opening new centers is an integral part of our long-term growth strategy, and we expect the majority of our future new centers to be franchisee-owned. Before we obtain the certificate of occupancy or report any revenue from new corporate-owned centers, we incur pre-opening costs, such as lease costs, labor expense and other operating expenses. Some of our centers open with an initial start-up period of higher-than-normal marketing and operating expenses, particularly as a percentage of monthly revenue.

Average Unit Volume (“AUV”). AUV consists of the average annual system-wide sales of all centers that have been open for a trailing 52-week period or longer. This measure is calculated by dividing system-wide sales during the applicable period for all centers being measured by the number of centers being measured. AUV allows management to assess our franchisee-owned and corporate-owned center economics. AUV growth is primarily driven by increases in services and retail product sales as centers fill their books of reservations, which we refer to as maturation of centers. Similarly, AUV declines are typically caused by decreases in services and retail product sales.


	For the Thirteen Weeks Ended						For the Thirty-Nine Weeks Ended
(in thousands, except operating data and percentages)	October 4, 2025			October 5, 2024			October 4, 2025			October 5, 2024
Number of system-wide centers (at period end)		1,053			1,064			1,053			1,064
System-wide sales	$	238,214		$	240,154		$	721,712		$	721,686
Same-store sales		0.2	%		(0.5	)%		0.4	%		0.0	%
Net new center (closures) openings		(6	)		5			(14	)		20

The table below presents changes in the number of system-wide centers for the periods indicated:


	For the Thirteen Weeks Ended						For the Thirty-Nine Weeks Ended
	October 4, 2025			October 5, 2024			October 4, 2025			October 5, 2024
System-wide Centers
Beginning of Period		1,059			1,059			1,067			1,044
Openings		3			12			10			33
Closures		(9	)		(7	)		(24	)		(13	)
End of Period		1,053			1,064			1,053			1,064

Significant Factors Impacting Our Financial Results

We believe there are several important factors that have impacted, and that we expect will continue to impact, our business and results of operations. These factors include:

Net New Center (Closures) Openings. We expect that new centers will be a key driver of growth in our future revenue and operating profit results. Opening new centers is an important part of our growth strategy, and we expect the majority of our future new centers will be franchisee-owned. Our results of operations have been and will continue to be materially affected by the timing and number of new center openings and closures each period. As centers mature, center revenue and profitability typically increase significantly. The performance of new centers may vary depending on various factors such as the effective management and cooperation of our franchisee partners, whether the franchise is part of a multi-unit development agreement, the center opening date, the time of year of a particular opening, the number of licensed wax specialists recruited, and the location of the new center, including whether it is located in a new or existing market. Our planned long-term center expansion will place increased demands on our operational, managerial, administrative, financial, and other resources. While we have opened new centers in 2025, closures will more than offset center growth on a net basis in 2025. Given the current macroeconomic environment, our short-term strategy involves a focus on realigning the business to improve existing centers' productivity and unit economics, which we believe will allow us to continue thoughtful center growth in the future.

System-Wide Sales Growth or Decline. System-wide sales is a key driver of our business. Various factors affect system-wide sales, including:

•

consumer preferences and overall economic trends;

•

the recurring, non-discretionary nature of personal-care services and purchases;

•

our ability to identify and respond effectively to guest preferences and trends;

•

our ability to provide a variety of service offerings that generate new and repeat visits to our centers;

•

the guest experience we provide in our centers;

•

the availability of experienced wax specialists;

•

our ability to source and deliver products accurately and timely;

•

changes in service or product pricing, including promotional activities;

•

the number of services or items purchased per center visit;

•

net new center openings or closures; and

•

center closures in response to state or local regulations or health concerns.

Overall Economic Trends. Macroeconomic factors that may affect guest spending patterns, and thereby our results of operations, include employment rates, the rate of inflation, business conditions, changes in the housing market, the availability of credit, interest rates, tax rates and fuel and energy costs. However, we believe that many of our guests see our services as largely non-discretionary in nature. Therefore, while overall economic trends and related changes in consumer behavior have impacted us and may impact us in the future, we believe that such changes have less of an impact on our business than they may have for other companies that have a significant portion of their sales attributed to discretionary consumer spending.

Guest Preferences and Demands. Our ability to maintain our appeal to existing guests and attract new guests depends on our ability to develop and offer a compelling assortment of services responsive to guest preferences and trends. We also believe that OOH waxing is a recurring need that brings guests back for services on a highly recurring basis which is reflected in the predictability of our financial performance over time. Our guests’ routine personal-care need for OOH waxing is further demonstrated by the top 20% of guests who visit us, on average, approximately every five weeks.

Our Ability to Source and Distribute Products Effectively. Our revenue and operating income are affected by our ability to purchase our products and supplies in sufficient quantities at competitive prices. While we believe our vendors have adequate capacity to meet our current and anticipated demand, our level of revenue could be adversely affected in the event we face constraints in our supply chain, including the inability of our vendors to produce sufficient quantities of some products or supplies in a manner that matches market demand from our guests, leading to lost revenue. We depend on two key suppliers to source our Comfort Wax and two key suppliers to source our branded retail products and we are thus exposed to concentration of supplier risk. Our supply chain incorporates both domestic and international procurement. However, more than half of our product cost is subject to various global tariffs. While the majority of our branded retail products are sourced domestically, our Comfort Wax is sourced from Europe and a portion of our medical supplies and retail product components are sourced from China. To address the recent increase in tariffs on internationally sourced products, we continue to deploy alternative sourcing strategies and are evaluating alternatives to mitigate cost increases.

Our Ability to Recruit and Retain Qualified Licensed Wax Specialists for our Franchised Centers. Our franchisees’ ability to operate their centers is largely dependent upon their ability to attract and retain qualified, licensed wax specialists. Our unmatched scale enables us to ensure that we universally train our wax specialists at the highest standards, ensuring that our guests experience consistent level of quality, regardless of the specific center they visit. The combination of consistent service delivery, across our trained base of wax specialists, along with the payment ease and convenience of our well-known, pre-paid Wax Pass program fosters loyalty and return visits across our guest base. Over time, our ability to build and maintain a strong pipeline of licensed wax specialists is important to preserving our current brand position.

Seasonality. Our results are subject to seasonality fluctuations in that services are typically in higher demand in periods leading up to holidays and the summer season. The resulting demand trend has historically yielded higher system-wide sales in the second and fourth quarter of our fiscal year. In addition, our quarterly results may fluctuate significantly, because of several factors, including the timing of center openings, price increases and promotions and general economic conditions.

Components of Results of Operations

Revenue

Product Sales: Product sales consist of revenue earned from sales of Comfort Wax, other products consumed in administering our wax services and retail merchandise to franchisees, as well as retail merchandise sold in corporate-owned centers. Revenue on product sales is recognized upon transfer of control. Our product sales revenue comprised 56.5% and 57.2% of our total revenue for the 13 weeks ended October 4, 2025 and October 5, 2024, respectively, and 55.7% and 56.9% of our total revenue for the 39 weeks ended October 4, 2025 and October 5, 2024, respectively.

Royalty Fees: Royalty fees are earned based on a percentage of the franchisees’ gross sales, net of retail product sales, as defined in the applicable franchise agreement, and recognized in the period the franchisees’ sales occur. The royalty fee is 6.0% of the franchisees’ gross sales for such period and is paid weekly. Our royalty fees revenue comprised 24.3% and 24.2% of our total revenue for the 13 weeks ended October 4, 2025 and October 5, 2024, respectively, and 24.7% and 24.1% of our total revenue for the 39 weeks ended October 4, 2025 and October 5, 2024, respectively.

Marketing Fees: Marketing fees are earned based on 3.0% of the franchisees’ gross sales, net of retail product sales, as defined in the applicable franchise agreement, and recognized in the period the franchisees’ sales occur. Additionally, the Company charges a fixed monthly fee to franchisees for search engine optimization and search engine marketing services, which is due on a monthly basis and recognized in the period when services are provided. Our marketing fees revenue comprised 14.0% and 13.7% of our total revenue for the 13 weeks ended October 4, 2025 and October 5, 2024, respectively, and 14.2% and 13.7% of our total revenue for the 39 weeks ended October 4, 2025 and October 5, 2024, respectively.

Other Revenue: Other revenue primarily consists of service revenues from our corporate-owned centers and franchise fees, as well as technology fees and training, which together represent 5.2% and 4.9% of our total revenue for the 13 weeks ended October 4, 2025 and October 5, 2024, respectively, and 5.4% and 5.3% of our total revenue for the 39 weeks ended October 4, 2025 and October 5, 2024, respectively. Service revenues from our corporate-owned centers are recognized at the time services are provided. Amounts collected in advance of the period in which service is rendered are recorded as deferred revenue.

Franchise fees are paid upon commencement of the franchise agreement and are deferred and recognized on a straight-line basis commencing at contract inception through the end of the franchise license term. Franchise agreements generally have terms of 10 years beginning on the date the center is opened and the initial franchise fees are amortized over a period approximating the term of the agreement. Deferred franchise fees expected to be recognized in periods greater than 12 months from the reporting date are classified as long-term on the condensed consolidated balance sheets. Technology fees and training are recognized as the related services are delivered and are not material to the overall business.

Costs and Expenses

Cost of Revenue: Cost of revenue primarily consists of the direct costs associated with wholesale product and retail merchandise sold, including distribution and outbound freight costs and provision for inventory obsolescence, as well as the cost of materials and labor for services rendered in our corporate-owned centers.

Selling, General and Administrative Expenses: Selling, general and administrative expenses primarily consist of wages, benefits and other compensation-related costs, third-party warehousing costs, corporate marketing costs, rent, software, and other administrative expenses incurred to support our existing franchise and corporate-owned centers, as well as expenses attributable to growth and development activities. Also included in selling, general and administrative expenses are accounting, legal, marketing, operations, and other professional fees. Third-party warehousing costs recorded as a component of selling, general and administrative expenses, which consists primarily of logistics services in the form of warehouse inventory storage management and fulfillment costs, were $0.6 million and $0.6 million for the 13 weeks ended October 4, 2025 and October 5, 2024, respectively, and $1.9 million and $1.9 million for the 39 weeks ended October 4, 2025 and October 5, 2024, respectively. Corporate marketing costs recorded as a component of selling, general and administrative expenses, which consists primarily of local and corporate marketing initiatives, sponsorships and influencers, were $0.4 million and $0.9 million for the 13 weeks ended October 4, 2025 and October 5, 2024, respectively, and $1.2 million and $1.7 million for the 39 weeks ended October 4, 2025 and October 5, 2024, respectively.

Advertising Expenses: Advertising expenses consist of advertising, public relations, and administrative expenses incurred to increase sales and further enhance the public reputation of the European Wax Center brand.

Depreciation and Amortization: Depreciation and amortization includes depreciation of property and equipment and capitalized leasehold improvements, as well as amortization of intangible assets, including franchisee relationships and reacquired area representative rights. Area representative rights represent an agreement with area representatives to sell franchise licenses and provide support to franchisees in a geographic region. From time to time, the Company enters into agreements to reacquire certain area representative rights.

Interest Expense, net: Interest expense, net consists of interest on our long-term debt, including amounts outstanding under our revolving financing facility, amortization of debt discount and deferred financing costs, gains and losses on debt extinguishment as well as interest income from short-term, highly-liquid investments.

Other (Income) Expense: Other (income) expense consists of non-cash gains and losses related to the remeasurement of our tax receivable agreement liability and contractual cash interest paid on our tax receivable agreement liability.

Income Tax Expense: We are subject to U.S. federal, state and local income taxes with respect to our taxable income, including our allocable share of any taxable income of EWC Ventures and are taxed at the prevailing corporate tax rates. Income tax expense includes both current and deferred income tax expense.

Noncontrolling Interests: We are the sole managing member of EWC Ventures. Because we manage and operate the business and control the strategic decisions and day-to-day operations of EWC Ventures and also have a substantial financial interest in EWC Ventures, we consolidate the financial results of EWC Ventures, and a portion of our net income is allocated to the noncontrolling interests to reflect the entitlement of the EWC Ventures Post-IPO Members to a portion of EWC Ventures’ net income.

Results of Operations

The following tables presents our condensed consolidated statements of operations for each of the periods indicated (amounts in thousands, except percentages):


	For the Thirteen Weeks Ended
	October 4, 2025			October 5, 2024			$ Change			% Change
Revenue:
Product sales	$	30,606		$	31,684		$	(1,078	)		(3.4	)%
Royalty fees		13,195			13,413			(218	)		(1.6	)%
Marketing fees		7,574			7,603			(29	)		(0.4	)%
Other revenue		2,810			2,730			80			2.9	%
Total revenue		54,185			55,430			(1,245	)		(2.2	)%
Operating expenses:
Cost of revenue		14,476			15,003			(527	)		(3.5	)%
Selling, general and administrative		13,036			17,474			(4,438	)		(25.4	)%
Advertising		7,610			8,409			(799	)		(9.5	)%
Depreciation and amortization		5,041			5,073			(32	)		(0.6	)%
Loss (gain) on disposal or impairment of assets		125			(2	)		127			(6350.0	)%
Total operating expenses		40,288			45,957			(5,669	)		(12.3	)%
Income from operations		13,897			9,473			4,424			46.7	%
Interest expense, net		6,520			6,340			180			2.8	%
Other (income) expense		(12	)		285			(297	)		104.2	%
Income before income taxes		7,389			2,848			4,541			159.4	%
Income tax expense		2,022			818			1,204			147.2	%
Net income	$	5,367		$	2,030		$	3,337			164.4	%
Less: net income attributable to noncontrolling interests		1,585			550			1,035			188.2	%
Net income attributable to European Wax Center, Inc.	$	3,782		$	1,480		$	2,302			155.5	%


	For the Thirty-Nine Weeks Ended
	October 4, 2025		October 5, 2024			$ Change			% Change
Revenue:
Product sales	$	89,992	$	95,105		$	(5,113	)		(5.4	)%
Royalty fees		39,901		40,314			(413	)		(1.0	)%
Marketing fees		22,885		22,841			44			0.2	%
Other revenue		8,745		8,915			(170	)		(1.9	)%
Total revenue		161,523		167,175			(5,652	)		(3.4	)%
Operating expenses:
Cost of revenue		41,927		44,551			(2,624	)		(5.9	)%
Selling, general and administrative		42,883		43,851			(968	)		(2.2	)%
Advertising		23,015		28,673			(5,658	)		(19.7	)%
Depreciation and amortization		15,025		15,246			(221	)		(1.4	)%
Loss (gain) on disposal or impairment of assets		125		(83	)		208			(250.6	)%
Total operating expenses		122,975		132,238			(9,263	)		(7.0	)%
Income from operations		38,548		34,937			3,611			10.3	%
Interest expense, net		19,747		19,043			704			3.7	%
Other expense		8		535			(527	)		98.5	%
Income before income taxes		18,793		15,359			3,434			22.4	%
Income tax expense		5,463		3,751			1,712			45.6	%
Net income	$	13,330	$	11,608		$	1,722			14.8	%
Less: net income attributable to noncontrolling interests		4,061		3,114			947			30.4	%
Net income attributable to European Wax Center, Inc.	$	9,269	$	8,494		$	775			9.1	%

The following table presents the components of our condensed consolidated statements of operations for each of the periods indicated, as a percentage of revenue:


	For the Thirteen Weeks Ended						For the Thirty-Nine Weeks Ended
	October 4, 2025			October 5, 2024			October 4, 2025			October 5, 2024
Revenue:
Product sales		56.5	%		57.2	%		55.7	%		56.9	%
Royalty fees		24.3	%		24.2	%		24.7	%		24.1	%
Marketing fees		14.0	%		13.7	%		14.2	%		13.7	%
Other revenue		5.2	%		4.9	%		5.4	%		5.3	%
Total revenue		100.0	%		100.0	%		100.0	%		100.0	%
Costs and expenses:
Cost of revenue		26.7	%		27.1	%		26.0	%		26.6	%
Selling, general and administrative		24.1	%		31.5	%		26.5	%		26.2	%
Advertising		14.0	%		15.1	%		14.2	%		17.2	%
Depreciation and amortization		9.3	%		9.2	%		9.3	%		9.1	%
Loss (gain) on disposal or impairment of assets		0.3	%		(0.0	)%		0.1	%		(0.0	)%
Total operating expenses		74.4	%		82.9	%		76.1	%		79.1	%
Income from operations		25.6	%		17.1	%		23.9	%		20.9	%
Interest expense, net		12.0	%		11.4	%		12.2	%		11.4	%
Other (income) expense		(0.0	)%		0.5	%		0.0	%		0.3	%
Income before income taxes		13.6	%		5.2	%		11.7	%		9.2	%
Income tax expense		3.7	%		1.5	%		3.4	%		2.2	%
Net income		9.9	%		3.7	%		8.3	%		7.0	%
Less: net income attributable to noncontrolling interests		2.9	%		1.0	%		2.6	%		1.9	%
Net income attributable to European Wax Center, Inc.		7.0	%		2.7	%		5.7	%		5.1	%

Comparison of the Thirteen Weeks Ended October 4, 2025 and October 5, 2024

Total Revenue

Total revenue decreased $1.2 million, or 2.2%, to $54.2 million during the 13 weeks ended October 4, 2025, compared to $55.4 million for the 13 weeks ended October 5, 2024. The decrease in total revenue was primarily due to a decrease in transactions at existing centers that resulted in decreases in product sales and royalty fees. This decrease in total revenue was partially offset by new center openings that became operational during the period from October 6, 2024 to October 4, 2025.

Product Sales

Product sales decreased $1.1 million, or 3.4%, to $30.6 million during the 13 weeks ended October 4, 2025, compared to $31.7 million for the 13 weeks ended October 5, 2024. The decrease in product sales was primarily due to a decrease in transactions at existing centers, which resulted in less sales of wax supplies and Comfort Wax to our franchisees. This decrease in product sales was partially offset by new center openings that became operational during the period from October 6, 2024 to October 4, 2025.

Royalty Fees

Royalty fees decreased $0.2 million, or 1.6%, to $13.2 million during the 13 weeks ended October 4, 2025, compared to $13.4 million for the 13 weeks ended October 5, 2024. The decrease in royalty fees during the 13 weeks ended October 4, 2025 was primarily the result of 31 centers that closed during the period from October 6, 2024 to October 4, 2025 and lower royalty fees received from existing centers and was partially offset by 20 new center openings during the same period that contributed less royalty fees than the closed centers did in the comparative period due to the timing of the new center openings and closures.

Marketing Fees

Marketing fees of $7.6 million during the 13 weeks ended October 4, 2025 was generally consistent compared to the 13 weeks ended October 5, 2024. Marketing fees increased as a result of new center openings that became operational during the period from October 6, 2024 to October 4, 2025 and was offset by centers that closed during the same period.

Other Revenue

Other revenue increased $0.1 million or 2.9% for the 13 weeks ended October 4, 2025 to $2.8 million compared to $2.7 million for 13 weeks ended October 5, 2024, primarily due to an increase in franchise fees that resulted from increased franchised center transfers in the current period.

Costs and Expenses

Cost of Revenue

Cost of revenue decreased $0.5 million, or 3.5%, to $14.5 million during the 13 weeks ended October 4, 2025, compared to $15.0 million for the 13 weeks ended October 5, 2024. The decrease in cost of revenue was primarily due to the decrease in product sales.

Selling, General and Administrative

Selling, general and administrative expenses decreased $4.4 million, or 25.4%, to $13.0 million during the 13 weeks ended October 4, 2025, compared to $17.5 million for the 13 weeks ended October 5, 2024. The decrease in selling, general and administrative expenses was primarily due to a $1.6 million decrease in payroll and benefits expense, a $0.8 million decrease in professional fees, a $0.5 million decrease in corporate marketing, a $0.4 million decrease in provision for bad debts, a $0.3 million decrease in recruiting costs and other miscellaneous decreases.

The decrease in payroll and benefits expense was primarily due to $1.5 million in executive severance during the 13 weeks ended October 5, 2024 that did not recur during the 13 weeks ended October 4, 2025, as well as a $0.5 million decrease in equity compensation, resulting primarily from forfeitures. These decreases in payroll and benefits expense were partially offset by increased headcount in our corporate office, which resulted in higher cash compensation, bonus accruals and equity compensation. The decrease in professional fees was primarily related to $0.9 million in terminated debt offering costs during the 13 weeks ended October 5, 2024 that did not recur during the 13 weeks ended October 4, 2025, which was offset by a $0.3 million litigation accrual.

Advertising

Advertising expenses decreased $0.8 million, or 9.5%, to $7.6 million during the 13 weeks ended October 4, 2025, compared to $8.4 million for the 13 weeks ended October 5, 2024, primarily due to timing of various advertising initiatives. Looking forward, we continue to invest in flexible, high-performing advertising channels and optimize our advertising spending to drive revenue growth and guest engagement.

Depreciation and Amortization

Depreciation and amortization for the 13 weeks ended October 4, 2025 was flat at $5.0 million compared to the 13 weeks ended October 5, 2024.

Interest Expense, net

Interest expense, net increased $0.2 million, or 2.8%, to $6.5 million during the 13 weeks ended October 4, 2025, compared to $6.3 million for the 13 weeks ended October 5, 2024. The increase was primarily due to a decrease in interest income from the Company’s short-term investments during the 13 weeks ended October 4, 2025.

Income Tax Expense

We recorded $2.0 million and $0.8 million of income tax expense for the 13 weeks ended October 4, 2025 and October 5, 2024, respectively. Income tax expense recognized in the 13 weeks ended October 4, 2025 differs from the federal statutory income tax rate primarily as a result of non-taxable income attributable to nondeductible officer compensation, noncontrolling interest, state taxes and the tax effects of stock compensation. Income tax expense recognized in the 13 weeks ended October 5, 2024 differs from the federal statutory income tax rate primarily as a result of non-taxable income attributable to noncontrolling interest, state taxes and the tax effects of stock compensation.

Comparison of the Thirty-Nine Weeks Ended October 4, 2025 and October 5, 2024

Total Revenue

Total revenue decreased $5.7 million, or 3.4%, to $161.5 million during the 39 weeks ended October 4, 2025, compared to $167.2 million for the 39 weeks ended October 5, 2024. The decrease in total revenue was primarily due to a decrease in product sales, royalty fees and other revenue and was partially offset by an increase in marketing fees.

Product Sales

Product sales decreased $5.1 million, or 5.4% to $90.0 million during the 39 weeks ended October 4, 2025, compared to $95.1 million for the 39 weeks ended October 5, 2024. The decrease in product sales was primarily due to a decrease in transactions at existing centers, which resulted in less sales of Comfort Wax, retail products and other wax supplies to our franchisees, as well as the removal of a surcharge to franchisees that was put in place during the COVID pandemic to help offset elevated supply chain costs.

Royalty Fees

Royalty fees decreased $0.4 million, or 1.0%, to $39.9 million during the 39 weeks ended October 4, 2025, compared to $40.3 million for the 39 weeks ended October 5, 2024. The decrease in royalty fees during the 39 weeks ended October 4, 2025 was primarily the result of 31 centers that closed during the period from October 6, 2024 to October 4, 2025 and lower royalty fees received from existing centers and was partially offset by 20 new center openings during the same period that contributed less royalty fees than the closed centers did in the comparative period due to the timing of the new center openings and closures.

Marketing Fees

Marketing fees of $22.9 million during the 39 weeks ended October 4, 2025 was generally consistent compared to the 39 weeks ended October 5, 2024. Marketing fees increased as a result of new center openings that became operational during the period from October 6, 2024 to October 4, 2025 and was offset by centers that closed during the same period.

Other Revenue

Other revenue decreased $0.2 million or 1.9% to $8.7 million for the 39 weeks ended October 4, 2025, compared to $8.9 million for the 39 weeks ended October 5, 2024, primarily due to the sale of a corporate-owned center in the comparative period and a decrease in franchise fees that resulted from fewer franchised center transfers in the current period.

Costs and Expenses

Cost of Revenue

Cost of revenue decreased $2.6 million, or 5.9%, to $41.9 million during the 39 weeks ended October 4, 2025, compared to $44.6 million for the 39 weeks ended October 5, 2024. The decrease in cost of revenue was primarily due to the decrease in product sales.

Selling, General and Administrative

Selling, general and administrative expenses decreased $1.0 million, or 2.2%, to $42.9 million during the 39 weeks ended October 4, 2025, compared to $43.9 million for the 39 weeks ended October 5, 2024. The decrease in selling, general and administrative expenses was primarily due to a $0.8 million decrease in technology fees, a $0.7 million decrease in annual franchisee conference expenses, a $0.6 million decrease in corporate marketing and a $0.5 million decrease in provision for bad debts. These decreases were partially offset by a $2.3 million increase in payroll and benefits and a $0.3 million litigation accrual.

The increase in payroll and benefits expense was primarily due to increased headcount in our corporate office, which resulted in higher cash compensation, bonus accruals and equity compensation. The increase was also due to $0.7 million related to an equity award that was granted to a vendor in December 2024 that is being recognized over the service period and the increase was partially offset by a $1.1 million decrease in executive severance.

Advertising

Advertising expenses decreased $5.7 million, or 19.7%, to $23.0 million during the 39 weeks ended October 4, 2025, compared to $28.7 million for the 39 weeks ended October 5, 2024, which had increased by $4.1 million, or 17% from $24.6 million for the 39 weeks ended September 30, 2023. Advertising expenses for the 39 weeks ended October 5, 2024 were elevated due to investments we made in several new marketing initiatives, and these initiatives were not repeated during the 39 weeks ended October 4, 2025. Advertising also decreased during the 39 weeks ended October 4, 2025 due to the timing of various advertising initiatives. Looking forward, we continue to invest in flexible, high-performing advertising channels and optimize our advertising spending to drive revenue growth and guest engagement.

Depreciation and Amortization

Depreciation and amortization for the 39 weeks ended October 4, 2025 was generally consistent with the 39 weeks ended October 5, 2024, decreasing $0.2 million, or 1.4%, to $15.0 million for the 39 weeks ended October 4, 2025.

Interest Expense, net

Interest expense, net increased $0.7 million, or 3.7%, to $19.7 million during the 39 weeks ended October 4, 2025, compared to $19.0 million for the 39 weeks ended October 5, 2024. The increase was primarily due to a decrease in interest income from the Company’s short-term investments during the 39 weeks ended October 4, 2025.

Income Tax Expense

We recorded $5.5 million and $3.8 million in income tax expense for the 39 weeks ended October 4, 2025 and October 5, 2024, respectively. Income tax expense recognized in the 39 weeks ended October 4, 2025 differs from the federal statutory income tax rate primarily as a result of non-taxable income attributable to nondeductible officer compensation, noncontrolling interest, state taxes and the tax effects of stock compensation. Income tax expense recognized in the 39 weeks ended October 5, 2024 differs from the federal statutory income tax rate primarily as a result of non-taxable income attributable to noncontrolling interest, state taxes and the tax effects of stock compensation.

Non-GAAP Financial Measures

In addition to our GAAP financial results, we believe the non-GAAP financial measures EBITDA and Adjusted EBITDA are useful in evaluating our performance. Our non-GAAP financial measures should not be considered in isolation from, or as substitutes for, financial information prepared in accordance with GAAP. These non-GAAP financial measures are presented for supplemental information purposes only and may be different from similarly titled metrics or measures presented by other companies. A reconciliation of the non-GAAP financial measures to the most directly comparable financial measure stated in accordance with GAAP and a further discussion of how we use non-GAAP financial measures is provided below.

EBITDA and Adjusted EBITDA. We define EBITDA as net income (loss) before interest, taxes, depreciation and amortization. We believe that EBITDA, which eliminates the impact of certain expenses that we do not believe reflect our underlying business performance, provides useful information to investors to assess the performance of our business. We define Adjusted EBITDA as net income (loss) before interest, taxes, depreciation and amortization, adjusted for the impact of certain additional non-cash and other items that we do not consider in our evaluation of ongoing performance of our core operations. These items include non-cash equity-based compensation expense, non-cash gains and losses on remeasurement of our tax receivable agreement liability, contractual cash interest on our tax receivable agreement liability, loss on disposal or impairment of assets, transaction costs, business transformation costs and other one-time expenses and/or gains. Business transformation costs primarily include expenses related to our business transformation and optimization efforts that do not qualify as capital expenditures under applicable accounting principles. We believe that Adjusted EBITDA is an appropriate measure of operating performance in addition to EBITDA because it eliminates the impact of other items that we believe reduce the comparability of our underlying core business performance from period to period and is therefore useful to our investors in comparing the core performance of our business from period to period. EBITDA and Adjusted EBITDA may not be comparable to other similarly titled captions of other companies due to differences in methods of calculation.

A reconciliation of net income to EBITDA and Adjusted EBITDA is set forth below for the periods indicated:


	For the Thirteen Weeks Ended					For the Thirty-Nine Weeks Ended
	October 4, 2025			October 5, 2024		October 4, 2025		October 5, 2024
(in thousands)
Net income	$	5,367		$	2,030	$	13,330	$	11,608
Interest expense, net		6,520			6,340		19,747		19,043
Income tax expense		2,022			818		5,463		3,751
Depreciation and amortization		5,041			5,073		15,025		15,246
EBITDA	$	18,950		$	14,261	$	53,565	$	49,648
Share-based compensation(1)		423			882		5,366		4,205
Remeasurement of tax receivable agreement liability(2)		(12	)		285		8		535
Gain on sale of center(3)		—			—		—		(81	)
Loss on disposal or impairment of assets(4)		125			—		125		—
Legal settlements(5)		261			—		261		(739	)
Executive severance(6)		—			1,548		465		1,548
Reorganization costs(7)		26			490		240		490
Terminated debt offering costs(8)		—			944		—		944
Business transformations costs(9)		401			—		550		—
Adjusted EBITDA	$	20,174		$	18,410	$	60,580	$	56,550

(1)

Represents non-cash equity-based compensation expense.

(2)

Represents non-cash adjustments related to the remeasurement of our tax receivable agreement liability.

(3)

Represents gain on the sale of a corporate-owned center.

(4)

Represents the loss on disposal or impairment of assets.

(5)

In the current fiscal year, the amount represents the estimated exposure to the Company resulting from a lawsuit, and in the prior fiscal year, the amount represents the collection of cash proceeds from a legal judgment, both of which were not resulting from our core operations.

(6)

Represents cash severance paid or payable to former executives.

(7)

Represents costs associated to the Company's return-to-office mandate.

(8)

Represents costs related to a debt offering the Company evaluated and subsequently decided to terminate.

(9)

Represents costs related to our business transformation and optimization efforts that do not qualify as capital expenditures under applicable accounting principles.

Liquidity and Capital Resources

We measure liquidity in terms of our ability to fund the cash requirements of our business operations, including working capital needs, capital expenditures, contractual obligations and debt service with cash flows from operations and other sources of funding. Our primary sources of liquidity and capital resources have been cash provided from operating activities, cash and cash equivalents on hand, proceeds from our Class A-2 Notes and Variable Funding Notes and proceeds from the issuance of equity to our stockholders. We had cash and cash equivalents of $73.6 million as of October 4, 2025.

Future payments under the TRA with respect to the purchase of EWC Ventures Units which occurred as part of the IPO and through October 4, 2025 are currently expected to be $204.4 million. Such amounts will be paid when such deferred tax assets are realized as a reduction to income taxes due or payable. That is, payments under the TRA are only expected to be made in periods following the filing of a tax return in which we are able to utilize certain tax benefits to reduce our cash taxes paid to a taxing authority. The impact of any changes in the projected obligations under the TRA as a result of changes in the geographic mix of the Company’s earnings, changes in tax legislation and tax rates or other factors that may impact the Company’s tax savings will be reflected in other expense on the condensed consolidated statements of operations in the period in which the change occurs. During the 39 weeks ended October 4, 2025 there were no material changes in our contractual obligations from those described in our annual report on Form 10-K for the fiscal year ended January 4, 2025.

We believe that our sources of liquidity and capital will be sufficient to finance our continued operations and growth strategy for at least the next twelve months. Our primary requirements for liquidity and capital are working capital, capital expenditures to grow our network of centers, debt servicing costs, and general corporate needs. We have in the past, and may in the future, refinance our existing indebtedness with new debt arrangements and utilize a portion of borrowings to return capital to our stockholders.

Our assessment of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement and involves risks and uncertainties. Our actual results and our future capital requirements could vary because of many factors, including our growth rate, the timing and extent of spending to acquire new centers and expand into new markets, and the expansion of sales and marketing activities. We may, in the future, enter into arrangements to acquire or invest in complementary businesses, services and technologies. We have based this estimate on assumptions that may prove to be wrong, and we could use our available capital resources sooner than we currently expect. We may be required to seek additional equity or debt financing. In the event that additional financing is required from outside sources, we may not be able to raise it on terms acceptable to us or at all. If we are unable to raise additional capital when desired, or if we cannot expand our operations or otherwise capitalize on our business opportunities because we lack sufficient capital, our business, results of operations and financial condition would be adversely affected.

Securitized Financing Facility

On April 6, 2022, the Master Issuer completed a securitization transaction pursuant to which it issued $400.0 million in aggregate principal amount of Class A-2 Notes. The net proceeds from the issuance of the Class A-2 Notes were used to repay our previous term loan, fund certain reserve amounts under the securitized financing facility, pay the transaction costs associated with the securitized financing facility, and fund a one-time special dividend to stockholders.

In connection with the issuance of the Class A-2 Notes, the Master Issuer also entered into (i) a revolving financing facility that allows for the issuance of up to $40.0 million in Variable Funding Notes, and certain letters of credit and (2) an advance funding facility with BofA, whereby BofA and any other advance funding provider thereunder will, in certain specified circumstances, make certain debt service advances and collateral protection advances. The Variable Funding Notes were undrawn as of October 4, 2025. The Class A-2 Notes and the Variable Funding Notes are referred to collectively as the “Notes.”

The Notes are subject to a series of covenants and restrictions customary for transactions of this type, including (i) that the Master Issuer maintains specified reserve accounts to be used to make required payments in respect of the Notes, (ii) provisions relating to optional and mandatory prepayments and the related payment of specified amounts, including specified make-whole payments in the case of the Class A-2 Notes under certain circumstances, (iii) certain indemnification payments in the event, among other things, the transfers of the assets pledged as collateral for the Notes are in stated ways defective or ineffective and (iv) covenants relating to recordkeeping, access to information and similar matters. The Notes are also subject to customary rapid amortization events provided for in the Base Indenture, dated April 6, 2022 (the “Indenture”), including events tied to failure to maintain a stated debt service coverage ratio, the sum of system-wide sales being below certain levels on certain measurement dates, certain manager termination events (including in certain cases a change of control of EWC Ventures, LLC), an event of default and the failure to repay or refinance the Notes on the applicable anticipated repayment date. The Notes are also subject to certain customary events of default, including events relating to non-payment of required interest, principal or other amounts due on or with respect to the Notes, failure to comply with covenants within certain time frames, certain bankruptcy events, breaches of specified representations and warranties, failure of security interests to be effective and certain judgments.

For additional information regarding our long-term debt activity, see the notes to the condensed consolidated financial statements (Note 5—Long-term debt) contained elsewhere in this quarterly report on Form 10-Q.

Tax Receivable Agreement

Generally, we are required under the TRA, which is described more fully in Part 1 “Item 1A. Risk Factors” in our annual report on Form 10-K for the fiscal year ended January 4, 2025 in the section entitled “Risks Relating to Our Organization and Structure—We are required to pay the EWC Ventures’ pre-IPO members for certain tax benefits we may claim, and the amounts we may pay could be significant” to make payments to the EWC Ventures pre-IPO members that are generally equal to 85% of the applicable cash tax savings, if any, that we actually realize (or are deemed to realize, calculated using certain assumptions) as a result of (i) increases in our allocable share of certain existing tax basis of the tangible and intangible assets of the Company and adjustments to the tax basis of the tangible and intangible assets of the Company, in each case as a result of (a) the purchases of EWC Ventures Units (along with the corresponding shares of our Class B common stock) from certain of the EWC Ventures Post-IPO Members using a portion of the net proceeds from the initial and secondary public offerings or in any future offering or (b) Share Exchanges and Cash Exchanges by the EWC Ventures pre-IPO members (or their transferees or other assignees) in connection with or after the initial public offering, (ii) our utilization of certain tax attributes of certain affiliates of General Atlantic (the “Blocker Companies”) (including the Blocker Companies’ allocable share of certain existing tax basis of EWC Ventures’ assets) and (iii) certain other tax benefits related to entering into the TRA, including tax benefits attributable to payments under the TRA.

Subject to the discussion in the following paragraph below, payments under the TRA will occur only after we have filed our U.S. federal and state income tax returns and realized the cash tax savings from the favorable tax attributes. Future payments under the TRA in respect of future purchases of EWC Ventures Units, Share Exchanges and Cash Exchanges would be in addition to these amounts. Payments under the TRA are computed by reference to realized tax benefits from attributes subject to the TRA and are expected to be funded by tax distributions made to us by our subsidiaries similar to how cash taxes would be funded to the extent these attributes did not exist. To the extent we are unable to make payments under the TRA for any reason (including because the Company’s securitized financing facility restricts the ability of our subsidiaries to make distributions to us), under the terms of the TRA such payments will be deferred and accrue interest until paid. If we are unable to make payments due to insufficient funds, such payments may be deferred indefinitely while accruing interest until paid, which could negatively impact our results of operations and could also affect our liquidity in future periods in which such deferred payments are made.

Under the TRA, as a result of certain types of transactions and other factors, including a transaction resulting in a change of control, we may also be required to make payments to the EWC Ventures pre-IPO members in amounts equal to the present value of future payments we are obligated to make under the TRA. If the payments under the TRA are accelerated, we may be required to raise additional debt or equity to fund such payments. To the extent that we are unable to make payments under the TRA for any reason (including because the Company’s securitized financing facility restricts the ability of our subsidiaries to make distributions to us), under the terms of the TRA Agreement such payments will be deferred and will accrue interest until paid. If we are unable to make payments due to insufficient funds to make such payments, such payments may be deferred indefinitely while accruing interest until paid, which could negatively impact our results of operations and could also affect our liquidity in future periods in which such deferred payments are made.

Summary Statements of Cash Flows

The following table sets forth the major components of our condensed consolidated statements of cash flows for the periods presented (amounts in thousands):


	For the Thirty-Nine Weeks Ended
	October 4, 2025			October 5, 2024
Net cash provided by (used in):
Operating activities	$	45,208		$	39,950
Investing activities		(2,173	)		(141	)
Financing activities		(19,205	)		(44,533	)
Net increase (decrease) in cash	$	23,830		$	(4,724	)

Operating Activities

During the 39 weeks ended October 4, 2025, net cash provided by operating activities was $45.2 million and consisted of $13.3 million net income combined with $30.0 million of non-cash items, consisting primarily of depreciation and amortization, equity compensation and deferred income taxes as well as $1.9 million of net cash provided by working capital and other activities. Cash provided by working capital and other activities during the 39 weeks ended October 4, 2025 reflected decreases in inventory, net, prepaid expenses and other assets, and accounts receivable of $3.4 million, $0.4 million and $0.2 million, respectively and was partially offset by decreases in deferred revenue and other long-term liabilities of $1.2 million and $1.0 million, respectively. The $5.3 million increase in cash provided by operating activities during the 39 weeks ended October 4, 2025 as compared to the 39 weeks ended October 5, 2024 was primarily the result of an increase in net income of $1.7 million, an increase in net cash provided by working capital and other activities of $1.5 million, and an increase in non-cash items of $2.0 million.

Investing Activities

In the 39 weeks ended October 4, 2025, we used $2.2 million of cash for purchases of property and equipment, compared to $0.3 million of cash purchases of property and equipment partially offset by $0.1 million proceeds from the sale of a corporate-owned center during the 39 weeks ended October 5, 2024.

Financing Activities

Cash used in financing activities was $19.2 million and $44.5 million during the 39 weeks ended October 4, 2025 and October 5, 2024, respectively. Financing activities during the 39 weeks ended October 4, 2025 consisted of the following payments:

•

$6.5 million in payments made pursuant to the TRA;

•

$3.4 million in tax distribution payments to EWC Ventures members;

•

$3.0 million repayment on the Class A-2 Notes;

•

$6.1 million used to repurchase 1,428,828 shares of Class A common stock and pay prior year excise tax; and

•

$0.2 million in taxes on vested RSUs paid by withholding shares.

Financing activities during the 39 weeks ended October 5, 2024 consisted of the following payments:

•

$30.1 million used to repurchase 3,976,621 shares of Class A common stock;

•

$6.5 million in payments made pursuant to the TRA;

•

$3.6 million in tax distributions to EWC Ventures members;

•

$3.0 million repayment on the Class A-2 Notes;

•

$0.8 million in dividend equivalents paid to holders of EWC Ventures Units; and

•

$0.5 million in taxes on vested RSUs paid by withholding shares.

Critical Accounting Estimates

Our consolidated financial statements are prepared in accordance with GAAP. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses, and related disclosures. We evaluate our estimates and assumptions on an ongoing basis. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Our actual results could differ from these estimates. There have been no changes to our critical accounting estimates from those described under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the fiscal year ended January 4, 2025.

JOBS Act

The Company is an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”) and may take advantage of reduced reporting requirements that are otherwise applicable to public companies. Section 107 of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies are required to comply with those standards. We have elected to use the extended transition period for complying with new or revised accounting standards. This may make it difficult to compare our financial results with the financial results of another public company that is either not an emerging growth company or is an emerging growth company that has chosen not to take advantage of the extended transition period exemptions because of the potential differences in accounting standards used.

Recent Accounting Pronouncements

See Note 2—Summary of significant accounting policies to the condensed consolidated financial statements included in this quarterly report on Form 10-Q for more information about recent accounting pronouncements, the timing of their adoption and our assessment, to the extent we have made one, of the potential impact of the pronouncements on our financial condition and results of operations and cash flows.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Risk

We are exposed to market risk related to changes in interest rates. Our primary exposure to market risk is interest rate sensitivity, which is affected by changes in the general level of U.S. interest rates, particularly because our Variable Funding Notes bear interest at a variable rate.

Our Class A-2 Notes bear interest at a fixed rate of 5.50%, and therefore our interest expense related to these notes would not be affected by an increase in market interest rates. Our Variable Funding Notes bear interest at a variable index rate plus an applicable margin. Accordingly, increases in the variable index rate could increase our interest payments under the Variable Funding Notes. However, as the Variable Funding Notes were undrawn as of October 4, 2025 an increase in the variable index rate would not impact on our financial position or results of operations.

Foreign Currency Risk

We are not currently exposed to significant market risk related to changes in foreign currency exchange rates; however, we have contracted with and may continue to contract with foreign vendors. Our operations may be subject to fluctuations in foreign currency exchange rates in the future.

Commodity Price Risk

We are exposed to market risk related to changes in commodity prices. Our primary exposure to commodity price risk is the pricing of our wax purchased from our significant suppliers, which may be adjusted upwards or downwards based on changes in prices of certain raw materials used in the production process.

Item 4. Controls and Procedures

Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of October 4, 2025. We conducted an evaluation of the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this report. Based on that evaluation, management concluded that our disclosure controls and procedures were effective.

Changes in internal control over financial reporting

There have been no changes in our internal control over financial reporting that occurred during the 13 weeks ended October 4, 2025, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II-OTHER INFORMATION

Item 1. Legal Proceedings

On July 1, 2025, a class-action lawsuit captioned Sydney Dunn v. European Wax Center, Inc. was filed in the United States District Court for the Northern District of California against the Company by a putative class representing users who booked a reservation on the Company’s website, asserting various privacy-related claims stemming from the Company’s purported use of digital tracking technologies on its website. While we anticipate a loss is probable in this matter, we also anticipate an insurance loss recovery is probable. Consequently, we have accrued an estimated loss and a corresponding insurance receivable, net of the policy’s deductible. Because the litigation is in its early stages, the actual loss could vary from our current estimate; however, we do not believe the loss would exceed our insurance policy’s $5.0 million coverage limits. Accordingly, we do not expect the impact to our Condensed Consolidated Statement of Operations to exceed the policy’s $250,000 deductible.

Item 1A. Risk Factors

Our operations and financial results are subject to various risks and uncertainties, including those disclosed in Part I, “Item 1A. Risk Factors” in our annual report on Form 10-K for the year ended January 4, 2025. You should carefully consider the risk factors set forth in our 10-K and the other information set forth in this quarterly report on Form 10-Q. You should be aware that these risk factors and other information may not describe every risk that we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially adversely affect our business, financial condition and/or operating results. There have been no material changes in our risk factors since our Annual Report on Form 10-K for the year ended January 4, 2025.

Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities

Share Repurchases

The following table provides information with respect to our purchases of European Wax Center, Inc. Class A common stock during the third quarter of fiscal year 2025.



Period:	Total Number Shares Purchased		Average Price Paid per Share (including fees)		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Approximate Dollar Value of Shares That May Yet be Purchased Under the Plans or Programs
July 6, 2025 - August 2, 2025	—		$	—	—		$	8,789,146
August 3, 2025 - August 30, 2025	—		$	—	—		$	8,789,146
August 31, 2025 - October 4, 2025		1,188,255	$	3.91		1,188,255	$	4,143,069
Total		1,188,255	$	3.91		1,188,255

In the third quarter of fiscal year 2025, 1,188,255 shares of Class A common stock were repurchased pursuant to the $50.0 million share repurchase plan authorized by our board of directors in May 2024. Purchases may be effected through one or more open market transactions, privately negotiated transactions, transactions structured through investment banking institutions or a combination of the foregoing. The Company may terminate the program at any time. As of October 4, 2025, $45.9 million had been repurchased under the plan.

Item 3. Defaults Upon Senior Securities

None.

Item 4.

None.

Item 5. Other Information

Trading Plans of Our Directors and Officers

Mine Safety Disclosures During the third quarter of fiscal year 2025, none of the Company’s directors or executive officers adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each item is defined in Item 408(a) of Regulation S-K.

Item 6. Exhibits


Exhibit Number		Description
3.1		Amended and Restated Certificate of Incorporation of the Registrant (incorporated by reference to Exhibit 4.1 to the Registrant’s Registration Statement on Form S-8 filed on August 4, 2021).
3.2		Certificate of Amendment of the Registrant’s Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on June 9, 2023).
3.3		Second Amended and Restated By-Laws of European Wax Center, Inc. (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on February 24, 2023).
31.1*		Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*		Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**		Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**		Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS		Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document.
101.SCH		Inline XBRL Taxonomy Extension Schema With Embedded Linkbases Document
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

* Filed herewith.

** European Wax Center, Inc. is furnishing, but not filing, the written statement pursuant to Title 18 United States

Code 1350, as added by Section 906 of the Sarbanes Oxley Act of 2002, of Christopher Morris, our Chief Executive Officer and Thomas Kim, our Chief Financial Officer.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	European Wax Center, Inc.

Date: November 12, 2025	By:	/s/ CHRISTOPHER MORRIS
		Christopher Morris
		Chief Executive Officer and Chairman (Principal Executive Officer)

Date: November 12, 2025	By:	/s/ THOMAS KIM
		Thomas Kim
		Chief Financial Officer
		(Principal Financial Officer)

EX-31.1 2 ewcz-ex31_1.htm EX-31.1 EX-31.1

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO

RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Christopher Morris, certify that:

I have reviewed this quarterly report on Form 10-Q of European Wax Center, Inc.;

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: November 12, 2025	By:	/s/ CHRISTOPHER MORRIS
		Christopher Morris
		Chief Executive Officer

EX-31.2 3 ewcz-ex31_2.htm EX-31.2 EX-31.2

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO

RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Thomas Kim, certify that:

I have reviewed this quarterly report on Form 10-Q of European Wax Center, Inc.;

The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)

(b)

(c)

(d)

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

(a)

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: November 12, 2025	By:	/s/ THOMAS KIM
		Thomas Kim
		Chief Financial Officer

EX-32.1 4 ewcz-ex32_1.htm EX-32.1 EX-32.1

Exhibit 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of European Wax Center, Inc. (the “Company”) on Form 10-Q for the period ending October 4, 2025 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Christopher Morris, as Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1)

The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.


Date: November 12, 2025	By:	/s/ CHRISTOPHER MORRIS
		Christopher Morris
		Chief Executive Officer

EX-32.2 5 ewcz-ex32_2.htm EX-32.2 EX-32.2

Exhibit 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of European Wax Center, Inc. (the “Company”) on Form 10-Q for the period ending October 4, 2025 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Thomas Kim, as Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1)

The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.


Date: November 12, 2025	By:	/s/ THOMAS KIM
		Thomas Kim
		Chief Financial Officer