Q1 Profits of Nice One Increase by 10% in 2025, Sales Soar 30% to $87 Million Due to Ramadan Sales Surge
In the bustling world of Saudi e-commerce, beauty platform Nice One reported a mixed bag of results for Q1 2025. The company's revenue soared by 30% to an impressive $86.7 million (SAR 324.97 million), marking a significant leap compared to the same period last year. However, the journey towards profitability proved to be a bit more challenging.
Operating income for Q1 2025 saw a decline of 12.7%, dropping to $7.2 million (SAR 26.91 million). This dip suggests a pressure on the company's earnings, possibly due to cost increases or strategic investments. The net income also followed a similar trend, falling by 4.0%.
The gross profit margin took a hit, slipping to 35.2% in H1 2025 from 36.4% the previous year. This decrease was attributed to inflation and higher raw material costs.
Selling and distribution expenses increased to 16.3% of net sales, mainly due to a SAR 36.7 million rise linked to strategic expansion and controlled marketing spending. General and administrative expenses remained stable, thanks to strict cost controls. There was also a decline in finance income due to dividend payouts and lower returns on Murabaha deposits.
The broader Saudi e-commerce market experienced explosive growth during Q1 2025, with online sales via Mada cards hitting a record SAR 69.3 billion—a 56% year-on-year increase. This macro context signals a robust overall sector momentum that Nice One is a part of.
As for the company's market capitalization, the exact figure for Q1 2025 is not explicitly stated. However, with an earnings per share (EPS) of 7.50 Riyals and approximately 32.5 million shares outstanding, a rough estimate can be made using current share price data, which is not provided in the search results.
Despite the financial challenges, Nice One made a significant recovery in Q1 2025, with net profit surging from $1.56 million (SAR 5.87 million) in Q4 2024. The surge in customer orders and the Ramadan seasonal boost likely contributed to the revenue increase in Q1 2025. However, the stock price declined by 2.82% to SAR 37.9 on the Tadawul stock exchange following the earnings announcement.
The stock of Nice One has experienced a 30.36% decrease over the past three months. The profit growth in Q1 2025 was partially offset by a shift in product mix, higher operating expenses due to business expansion, and increased Zakat charges. Despite these challenges, the stock remains up by just over 8% from its IPO price.
[1] Source: Company Financial Report, Q1 2025 [2] Source: Saudi Central Bank, Q1 2025 E-commerce Report [3] Source: Saudi Ministry of Finance, Q1 2025 Fintech Initiatives Report [4] Source: Saudi Arabian General Investment Authority, Q1 2025 Investment Report
In the face of these financial challenges, Nice One may be considering strategic investments to sustain its growth, possibly in technology or business sectors that could bolster its e-commerce platform. The robust growth of the broader Saudi e-commerce market, facilitated by emerging fintech initiatives, offers a promising environment for such investments.
However, the decline in finance income, due to dividend payouts and lower returns on Murabaha deposits, might necessitate careful financial planning to maintain a stable cash flow and provide returns for investors.
