Beauty segment sales falter for THG, though nutrition division demonstrates signs of recuperation
A Rough Quarter for THG: Beauty Sales Plummet, Nutrition Division Falters
THG, the e-commerce giant behind Cult Beauty and Myprotein, has reported a dismal first quarter with a staggering 8% drop in overall revenue. The three months ending March saw the company's sales decline to £375.6 million, a whopping £37.5 million drop in comparison to the previous year.
The beauty arm of the business took the heaviest blow, with sales plummeting by 9.8% to £223.6 million. Despite the decline, THG attributes the drop to a few factors. The first being the Easter weekend in 2023, which occurred in late March, inflating the previous year's sales by accidental timing. The company also confessed to strategically scaling back sales activity in certain Asian and European markets to focus on attracting higher-margin customers.
This weak demand for beauty products has managed to offset the nutrition-related sales' growth in February and March, thanks to the rising number of online customers within the UK. Although the nutrition division experienced a decline of 8.7% in 2024, it demonstrated signs of recovery by registering constant-currency growth in Q1 2025.
THG's decline didn't stop with the Q1 sales figures, as the growth slump in the nutrition unit also contributed to its 2024 revenue dipping by £579.8 million, down from its 2023 record. This steep fall can be partially attributed to the company's decision to slash prices to clear old stock as part of its rebranding strategy.
In an attempt to revive the company's fortunes, THG "spun off" the loss-making technology platform Ingenuity in January 2025 to simplify operations and bolster its finances. Following the spin-off, THG completed a debt refinancing deal extending up to 2029, conducted an equity raise, and entered the FTSE 250 Index.
CEO Matthew Moulding, otherwise known as the co-founder of THG, remains hopeful about the future of these businesses. He stated, "We are now fully focused on THG Beauty and THG Nutrition." He added, "Both our businesses have undertaken extensive model changes over the past 24 months. Beauty has focused on more profitable markets and building loyalty schemes, while Myprotein has pressed ahead in undertaking a successful rebrand, underpinning rapid growth across global offline retail and licensing."
Past performance has shown that THG has grappled with heavy losses, slowing online trade, and corporate governance concerns since its 2020 London Stock Exchange debut. SHG shares have plunged by an astounding 95% from their initial public offering price, tumbling from £500 per share to 26.1p as of mid-2025.
- Despite the challenges in its nutrition division, THG continues to explore investing in business expansion, such as undertaking a rebranding strategy for Myprotein.
- The decline in THG's sales in the first quarter of 2024, attributed to the beauty arm's plummeting sales and the faltering nutrition division, was significantly reflected in its overall revenue of £375.6 million.
- The finance team at THG is expected to work closely with the sales team to focus on attracting higher-margin customers, particularly in certain Asian and European markets, to boost sales moving forward.
- Technology, a division of THG, faced its own hardships in 2024, with the spin-off of the loss-making technology platform Ingenuity aimed at simplifying operations and bolstering finances.
- With a renewed focus on THG Beauty and THG Nutrition, CEO Matthew Moulding looks towards finance, business, and technology advancements to drive growth and race back to profitability in the future.
