Skip to content
    PTRN
    Earnings call· Mar 2026(Q1 FY26)

    Pattern Group Q1 FY26 earnings call PTRN

    May 6, 2026 Source

    Executive summary

    Pattern Group Inc. Q1 FY26 — Record NRR and Strong International Growth

    Pattern Group delivered a strong Q1 FY26, marked by record Net Revenue Retention and significant growth across international and non-Amazon channels. The company's platform, leveraging AI and data, continues to optimize e-commerce variables for brand partners, driving both growth and cost advantages. Management is confident in its ability to navigate macro headwinds through portfolio diversification and is raising its full-year outlook, while continuing strategic investments in R&D and infrastructure.

    Highlights

    5

    • Revenue grew 43% year-over-year to $774 million.

    • Adjusted EBITDA increased 59% year-over-year to $54 million.

    • Net Revenue Retention (NRR) reached a record 127%, up from 115% last year.

    • International revenue increased 101% year-over-year.

    • Non-Amazon revenue grew 119% year-over-year, driven by TikTok Shop, Walmart, and Coupang.

    Concerns

    3

    • Geopolitical tensions in the Middle East introduced volatility into global logistics and energy costs, as well as uncertainty around consumer sentiment.

    • The company expects to face stronger comps in the back half of the year, leading to moderating year-over-year growth in Q3 and Q4.

    • Incremental costs related to the Accelerate conference and start-up costs for the new East Coast facility are expected to impact Q2 adjusted EBITDA margin.

    Guidance & targets

    6
    CategoryTargetConfidence
    Full-year 2026 Revenue
    approximately $3.3 billion
    high materiality
    High
    Full-year 2026 Adjusted EBITDA
    approximately $200 million
    high materiality
    High
    Q2 2026 Revenue
    $810 million to $820 million
    high materiality
    High
    Q2 2026 Adjusted EBITDA
    $45 million to $46 million
    high materiality
    High
    Full-year 2026 NRR
    approximately 119%
    medium materiality
    High
    R&D growth
    outpace revenue growth
    medium materiality
    High

    Operational metrics

    15
    Revenue growth
    43%YoY
    Q1 FY26

    Total revenue growth for the quarter.

    Net Revenue Retention (NRR)
    127%up from 115% last year
    Q1 FY26

    Record NRR, reflecting optimization, marketplace expansion, and deeper brand relationships.

    Non-Amazon revenue growth
    119%YoY
    Q1 FY26

    Strong growth across TikTok Shop, Walmart, and Coupang.

    Other monetization strategies growth
    173%YoY
    Q1 FY26

    Reflecting continued momentum beyond core marketplace offering.

    R&D spend
    $10.1 millionup 77% YoY
    Q1 FY26

    Increased investment in technology, including AI token usage.

    Cash and cash equivalents
    $344 million
    Q1 FY26

    Balance at the end of Q1.

    Revolving credit facility capacity
    $150 million
    Q1 FY26

    Available borrowing capacity.

    Same-day/1-day delivery coverage
    57%up from 52%
    Q1 FY26

    Proportion of total clicks receiving fast delivery.

    Conversion rate (same-day/1-day delivery)
    18%
    Q1 FY26

    Conversion rate for orders with same-day or 1-day delivery.

    Conversion rate (2-day+ delivery)
    9%
    Q1 FY26

    Conversion rate for orders with 2-day or longer delivery.

    Days of inventory on hand
    62minus 13 days from last year
    Q1 FY26

    Exceptional quarter for inventory management.

    Pipeline GMV
    $505 billion
    long-term

    Identified opportunity list of brands that can benefit from Pattern's services.

    Social commerce business growth
    triple digitsYoY
    Q1 FY26

    Continued strong growth in social commerce.

    TikTok Shop brands launched
    over 100
    last 12 months

    Number of brands launched on TikTok Shop.

    TikTok Shop creators activated
    over 365,000
    last 12 months

    Number of creators activated for social commerce on TikTok Shop.

    Industry KPIs

    2
    MetricValueDetails
    Regional market performance101%%
    Operating income EBIT and adjusted EBITDA$54 millionUSD

    Product announcements

    1
    ProductTypeDetails
    The Portal (AI Photo Studio)launch

    Deals & partnerships

    1
    TikTok ShopStrategic Partner of the Year award

    Pattern Group was recently named TikTok Shop's Strategic Partner of the Year, highlighting its leadership and success in social commerce, including launching over 100 brands and activating over 365,000 creators.

    Risks & headwinds

    4
    Geopolitical tensions and macro environmentnear-term

    Middle East is an immaterial portion of revenue today, but tensions introduce volatility into global logistics and energy costs.

    Mitigation: Agreements with brand partners allow pass-through of cost changes (e.g., fuel surcharges); portfolio approach and category diversification (including non-discretionary categories) provide resilience.

    Stronger comparable periods in H2H2 FY26

    Year-over-year growth expected to moderate in Q3 and Q4.

    Mitigation: Acknowledged in guidance framework; management maintains a middle-of-the-road approach on new brand partner revenue and product expansions due to inherent variability.

    Increased R&D investmentFY26

    R&D growth expected to outpace revenue growth.

    Mitigation: Strategic investment to strengthen technology moat and expand AI capabilities, done responsibly to drive future growth.

    Incremental costs in Q2Q2 FY26

    Expected to impact Q2 adjusted EBITDA margin.

    Mitigation: Related to Accelerate conference and start-up costs for new East Coast facility; viewed as short-term investments for continued future growth.

    What to watch in Q2 FY26

    5

    Q2 Revenue

    next quarter
    CurrentQ1 revenue $774M
    Target$810M-$820M

    Why it matters

    Verifying the company's ability to meet its raised Q2 revenue guidance will indicate continued strong momentum.

    For the second quarter, we expect revenue in the range of $810 million to $820 million, representing 35% to 37% growth year-over-year.

    Q&A highlights

    7

    What drove the exceptionally strong Q1 performance, and what initiatives are driving the strong non-Amazon channel growth?

    Management attributed strong Q1 to hitting on all growth levers: better tech, more marketplaces, more products for existing brands, and new brand partners. Non-Amazon growth was driven by TikTok, Walmart, and Coupang, with a focus on diversifying revenue mix to align with consumer online spending.

    “this business model has a lot of ways to help brands grow across multiple vectors. And when we hit on all of them, that gives us confidence to raise the outlook, and that's what we did with the 32% growth for the full year.”

    asked by Ralph Schackart · answered by Jason Beesley

    2 min read6 chapters

    Detailed Narrative

    01

    E-commerce Equation and Platform Advantage

    Pattern's platform is designed to optimize the four key e-commerce variables: traffic, conversion, price, and availability. By operating across multiple marketplaces, geographies, and channels, the company leverages its scale, data, and AI to improve outcomes for brand partners while lowering costs in fulfillment, ad spend, and operations. This integrated approach creates a competitive advantage that individual brands struggle to replicate, driving significant revenue growth and efficiency gains.

    02

    International and Non-Amazon Growth Drivers

    The company reported robust international revenue growth of 101% year-over-year and non-Amazon revenue growth of 119% year-over-year. This diversification is driven by expansion into new marketplaces like TikTok Shop, Walmart, and Coupang, where the company has achieved triple-digit growth. Pattern's strategy includes taking brands to more marketplaces and geographies, with a long-term view that its revenue mix should align with how consumers spend online globally.

    03

    Social Commerce and AI-Driven Discovery

    Pattern is actively engaging with evolving commerce channels, particularly social commerce and AI-driven discovery. The company was named TikTok Shop's Strategic Partner of the Year, having launched over 100 brands and activated 365,000 creators. Pattern is also leveraging its data-first approach to optimize content and positioning for LLM-driven discovery, recognizing the growing influence of AI on customer journeys and the importance of execution signals like availability and delivery speed in an AI-driven world.

    04

    Supply Chain Optimization and Delivery Speeds

    The company continues to make significant progress in supply chain efficiency, with 57% of total clicks now receiving same-day or one-day delivery, up from 52% last year. This improvement in delivery speed correlates with a higher conversion rate (18% for same-day/one-day vs. 9% for two-day+). Pattern also reduced days of inventory on hand to 62, a 13-day improvement year-over-year, demonstrating the benefits of scale in logistics. The upcoming East Coast facility is expected to further enhance these efficiencies.

    05

    Scale Benefits and Market Opportunity

    Pattern highlights the benefits of its increasing scale, noting an 84% revenue growth from FY24 to FY26 (guided) and a doubling of Adjusted EBITDA over the same period. Management believes its ability to provide a service that is both better and less expensive than brands can achieve themselves, combined with a large total addressable market (TAM) of largely digital goods sold worldwide, positions the company for continued long-term growth and market outperformance.

    06

    New Brand Partner Acquisition and Pipeline

    The new brand partner pipeline remains strong, with an identified opportunity list of $505 billion in GMV. The company continues to invest in sales and marketing to drive new partner acquisition, emphasizing that these relationships not only deliver initial revenue but also contribute to long-term growth through existing brand partner revenue and the high Net Revenue Retention rate.

    AI-generated summary of the company’s earnings call. Not investment advice.