Waldencast plc (WALD): Business Model Canvas [Dec-2025 Updated]

You're looking to understand the engine driving Waldencast plc (WALD) right now, and honestly, it's a fascinating mix of clinical skincare and clean color cosmetics built on a platform that just secured a $\mathbf{\$205}$ million credit facility. As a former head analyst, I see a model focused on accelerating growth, evidenced by their $\mathbf{\$200.0}$ million Net Revenue across the first three quarters of 2025, even while managing a $\mathbf{\$172.1}$ million net debt position as of Q1 2025. This business is actively reshaping its structure, highlighted by the $\mathbf{\$82.5}$ million cash inflow from the Obagi Japan trademark sale, all while trying to scale the value propositions of Obagi Medical and Milk Makeup. Dive into the full Business Model Canvas below to see exactly how they structure partnerships, manage costs, and plan to grow from this dynamic base.

Waldencast plc (WALD) - Canvas Business Model: Key Partnerships

You're looking at the core relationships Waldencast plc maintains to run its business, especially how they get products to market and fund operations as of late 2025. These alliances are critical for brand scaling and financial stability.

The company has been actively reshaping its financial structure through key transactions involving partners. Waldencast plc sold its rights to the 'Obagi' trademark in Japan to Rohto Pharmaceutical Co. Ltd. for $82.5 million. This deal monetizes a brand asset while Rohto, a former licensee since 2002, now fully owns the mark for the Japanese market. Previously, the royalties from Rohto contributed 3% of Obagi Medical's net revenue for the fiscal year ending December 31, 2024. The proceeds from this sale are intended to repay a significant portion of new debt.

To bolster liquidity and extend its maturity profile to March 2030, Waldencast entered a new credit agreement with funds managed by entities of Lumina Capital Management. The Q1 2025 results indicated securing a new $205 million five-year credit facility, which comprised a $175 million term loan and a $30 million revolving credit facility (RCF). Separately, the November 2025 announcement detailed a new three-year secured first-lien term loan facility under the Lumina Credit Agreement in the aggregate principal amount of $225 million, with proceeds expected by November 17, 2025, to repay existing facilities and fund working capital.

Distribution relies heavily on strategic retail and digital partners. Milk Makeup, for example, launched with Amazon Premium Beauty to expand its digital footprint, and also entered Ulta Beauty, which represented a major new U.S. distribution channel for the brand. The Ulta Beauty partnership saw high consumer demand with strong initial sell-out, contributing to high single-digit growth in U.S. retail sales for Milk Makeup in Q1 2025.

For the Obagi Medical brand, distribution is anchored by relationships with medical professionals and physician dispense networks. The company is also investing in international market expansion for Obagi Medical, alongside supply chain restructuring.

Here's a quick look at the financial partnership details:

The operational focus includes leveraging these relationships for growth, as seen by Milk Makeup's capital investment in fixtures specifically as part of its Ulta Beauty partnership.

Key dependencies in these partnerships include:

• Maintaining strong sell-out performance at Ulta Beauty.
• Successful integration of the Amazon Premium Beauty digital presence.
• The timing and net proceeds of the November 2025 financing, expected by November 17, 2025.
• Continued access to physician networks for Obagi Medical.

Finance: review covenant flexibility through Q4 2026 on the new credit facility by Monday.

Waldencast plc (WALD) - Canvas Business Model: Key Activities

You're looking at the core actions Waldencast plc is taking to run and grow its multi-brand platform as of late 2025. These aren't just vague goals; they are the specific, measurable things the company must execute to deliver on its strategy, and we have the numbers to back up the effort.

Acquiring and accelerating high-growth, conscious beauty and wellness brands.

This activity involves both bringing new entities onto the platform and optimizing the existing portfolio. A major step in acceleration was the acquisition of Novaestiq Corp., which, along with securing U.S. rights to the Obagi Saypha® line of hyaluronic acid (HA) injectable gels, effectively doubles Obagi Medical's U.S. addressable market. To manage the portfolio and strengthen the balance sheet, Waldencast plc announced the sale of its rights to the "Obagi" trademark in Japan to Rohto Pharmaceutical Co., Ltd. for $82.5 million in November 2025.

Supply chain restructuring and third-party logistics (3PL) consolidation for efficiency.

The company is actively working to fix fulfillment issues that arose from this transformation. In the first quarter of 2025, ongoing supply chain restructuring led to out-of-stock issues on key SKUs for Obagi Medical. These efforts, which include consolidating third-party logistics providers and optimizing the distribution center network, were noted as contributing to higher supply chain costs in Q1 2025, which tempered the Adjusted EBITDA margin. Management expects these changes to deliver further improvements in the second half of 2025.

Research and development (R&D) for breakthrough innovation (e.g., Obagi Saypha®).

Innovation is clearly focused on expanding into new, high-value categories like medical aesthetics. Obagi Medical secured U.S. rights to Saypha® fillers and obtained FDA approval for Obagi Saypha MagIQ Hyaluronic Acid Gel. This move is the first step toward realizing the vision of becoming a dermatological Mega-Brand, serving physicians and consumers globally. Milk Makeup also saw success with new product launches, like the Hydro Grip Gel Tint, which significantly exceeded expectations.

Global brand building and targeted marketing investments in international markets.

Investments in marketing are a key driver, though they impact near-term profitability. In Q1 2025, the Adjusted EBITDA margin declined year-over-year to 6.7% of net revenue, primarily due to higher marketing investments and increased supply chain costs. International performance shows contrast: Obagi Medical saw acceleration in international markets, with Q2 growth in the mid-40s following launches in the Middle East and the Nordics, and Q3 2025 net revenue reached $42.6 million, supported by international markets. Conversely, Milk Makeup faced softness in international markets, contributing to a Q3 2025 net revenue decline of $6.3 million versus Q3 2024.

Executing a strategic review to enhance shareholder value.

The Board of Directors launched an exploration of a broad range of strategic alternatives focused on maximizing shareholder value, announced in August 2025. This review is significant enough that the Company postponed the H1 2025 earnings conference call and did not plan to host one for the Q2/Q3 2025 results.

Here's a quick look at the financial context surrounding these activities through the first nine months of 2025:

The company is defintely prioritizing portfolio refinement and high-potential innovation over broad top-line growth for the near term, as evidenced by the strategic review and the sale of the Japan trademark.

Waldencast plc (WALD) - Canvas Business Model: Key Resources

You're evaluating the core assets Waldencast plc uses to run its business as of late 2025. These resources are what the platform relies on to execute its strategy across its portfolio.

The portfolio centers on two established brands: Obagi Medical and Milk Makeup. These represent distinct, yet complementary, segments of the beauty and wellness space. Obagi Medical, rooted in over 35 years of experience, is noted as the fastest-growing U.S. professional-skincare brand among the top ten in its category.

The financial flexibility resource was recently bolstered. Waldencast plc secured a new $205 million five-year credit facility, which comprised a $175 million term loan and a $30 million revolving credit facility, replacing a prior arrangement to enhance financial flexibility. This facility was intended to support investment in the brands.

A major strategic asset is the intellectual property (IP) and clinical data gained through the Novaestiq acquisition. This move brought the U.S. rights to the Saypha® line of hyaluronic acid (HA) injectable gels. This acquisition effectively doubles Obagi Medical's U.S. addressable market by entering the U.S. dermal filler market, projected to reach $2 billion in market size by 2029. This positions Obagi Medical to serve the combined medical-grade skincare and aesthetics industry, where the U.S. medical-grade skincare market was projected to be $2.2 billion by 2029. The expertise in managing global beauty brands at scale is demonstrated by the platform's ability to support these brands.

Here's a look at the latest reported revenue performance for the key brand assets in the third quarter of 2025:

The platform's operational scale is a key resource, allowing it to manage the brands with asset-light efficiency. The expertise is further evidenced by Obagi Medical achieving the leading position in unaided brand awareness within its competitive set as of Q3 2025.

The intellectual property is also being leveraged through innovation, such as the introduction of the Obagi Medical Saypha® ChIQ™ and MagIQ™ lines of injectable HA gels.

The platform's operational structure is designed to benefit the brands through:

• Operational scale of a multi-brand platform.
• Expertise in managing global beauty brands at scale.
• A balanced portfolio to mitigate category fluctuations.
• Asset light efficiency.
• Market responsiveness and speed of entrepreneurial indie brands.

Finance: review the impact of the November 2025 $225 million credit agreement on the $205 million facility structure by next Tuesday.

Waldencast plc (WALD) - Canvas Business Model: Value Propositions

You're looking at the core value Waldencast plc offers its customers and the market, which is built around its distinct brand portfolio and the underlying platform supporting them. It's not just about the products; it's about the structure that lets them perform.

Obagi Medical: Clinically Proven Skincare

The Obagi Medical brand brings a 35+ year legacy of advanced, clinically proven skincare to the table. This isn't a flash-in-the-pan brand; it has deep roots in skin biology. For the first half of 2025 (H1 2025), Obagi Medical was a clear growth engine, posting net revenue of approximately $36.2 million in Q1 2025, representing a 7.1% year-over-year increase, largely driven by its direct-to-consumer channels. By Q3 2025, its net revenue hit $42.6 million, showing double-digit growth compared to Q3 2024, supported by international expansion in markets like the U.K., Middle East, and Southeast Asia.

Milk Makeup: Clean Color Cosmetics

Milk Makeup delivers high-performance color cosmetics built on clean, vegan, and cruelty-free principles. While the brand faced tough year-over-year comparisons, especially cycling the highly successful Jellies launch from Q1 2024, its U.S. performance remains strong. For the first nine months of 2025, U.S. consumption for Milk Makeup was up 12% year to date, fueled by retail expansion, including its launch on Amazon Premium Beauty. Still, its Q3 2025 net revenue was $25.2 million, down from the prior year, showing the challenge of managing growth against exceptional prior-year performance.

Multi-brand Platform Scale and Efficiency

Waldencast plc's value proposition includes the operational scale and asset-light efficiency of its multi-brand platform. This structure helps manage costs and speed up execution. For H1 2025, the platform supported an Adjusted Gross Profit of $98.1 million, translating to an Adjusted Gross Margin of 74.1% of net revenue. This margin, while contracting 150 basis points year-over-year due to inventory quality improvements, still shows the inherent high-margin nature of the business model. Furthermore, the platform facilitated the $82.5 million sale of the Obagi Japan trademark, strengthening the balance sheet without sacrificing core brand operations.

The platform's operational benefits include:

• Expertise in managing global beauty brands at scale.
• Market responsiveness and speed of entrepreneurial indie brands.
• Technology infrastructure optimization efforts across brands.
• Securing a new $205 million five-year credit facility in Q1 2025.

Balanced Portfolio Mitigating Category Fluctuations

The combination of skincare (Obagi Medical) and color cosmetics (Milk Makeup) is designed to balance out category-specific fluctuations. You can see this balancing act in the Q3 2025 results. While Milk Makeup's net revenue declined to $25.2 million, Obagi Medical's double-digit growth pushed total net revenue to $67.8 million, a decrease of only 3.4% year-over-year for the quarter. This portfolio mix is a deliberate strategy to smooth out revenue volatility.

Here's a look at the Q3 2025 revenue contribution:

Access to Medical Aesthetics with FDA-Approved Injectables

Waldencast plc is actively expanding its value proposition into medical aesthetics, leveraging the trusted Obagi Medical brand. A major milestone was the September 10, 2025 FDA approval for Obagi® Saypha® MagIQ™ injectable hyaluronic acid gel. This entry into the U.S. HA dermal filler market is expected to double Obagi Medical's total addressable market in the U.S. to approximately $4.2 billion by 2029. The planned U.S. launch in 2026 is set to create synergies with the existing skincare network, offering an integrated aesthetic solution. The company also advanced its platform by completing the Novaestiq acquisition to support this move.

Key aesthetics market data points:

• FDA approval for Obagi® Saypha® MagIQ™ secured: September 10, 2025.
• Projected U.S. addressable market expansion by 2029: 2x.
• Projected U.S. addressable market size by 2029: $4.2 billion.
• Planned U.S. commercial launch: 2026.

Finance: draft 13-week cash view by Friday.

Waldencast plc (WALD) - Canvas Business Model: Customer Relationships

You're looking at how Waldencast plc builds and keeps its customer base across its brands, which is all about direct connection and brand ethos. It's a mix of high-touch professional relationships and digital community building.

Direct-to-consumer (DTC) e-commerce for high-value consumer acquisition and retention

The DTC e-commerce channel is a key driver, especially for the Obagi Medical brand. Following the full annualization of the transition to a first-party model with its primary e-commerce distributor in Q1 2025, Obagi Medical saw its Net Revenue reach $36.2 million in that quarter, marking a 7.1% increase over Q1 2024. This strength in brand-controlled e-commerce continued, as Obagi Medical's Q3 2025 net revenue of $42.6 million was supported by strong performance in U.S. brand controlled e-commerce. For Milk Makeup, digital engagement was enhanced by expanding its digital footprint with a launch on Amazon Premium Beauty in Q2 2025.

The overall focus on digital success is clear:

• Both Milk Makeup and Obagi Medical saw continued growth driven by successful consumer acquisition and retention efforts as of Q1 2025.
• Obagi Medical achieved the leading position in unaided brand awareness within its competitive set as of H1 2025.

Professional consultation and dispense model for Obagi Medical products

The professional channel, which involves consultation and dispense, remains an important, though sometimes volatile, part of the Obagi Medical relationship strategy. In Q1 2025, the Physician Dispense channel experienced a decline, which management attributed to supply chain restructuring and temporary inventory constraints on key products. This muted performance continued into Q3 2025, where the Physician Dispensed channel was temporarily quiet as the company upgraded go-to-market capabilities ahead of the Obagi Saypha® launch into the aesthetics market. Still, Obagi Medical delivered double-digit growth in its Core Strategic Channels for H1 2025. The brand's total Q3 2025 net revenue was $42.6 million.

Here's a look at the channel dynamics for Obagi Medical:

High-impact brand collaborations (e.g., Milk Makeup with Nike) for community engagement

Milk Makeup uses high-impact collaborations to deepen community engagement and expand reach. In Q1 2025, the brand extended its partnership with Nike, most recently executing the Nike After Dark Tour in Los Angeles. This specific tour engaged 15,000 runners. The collaboration extended to product, featuring a limited-edition Milk Makeup Balmade lip balm sold exclusively alongside the launch of the Nike Vomero Plus in Hyper Pink at Dick's Sporting Goods. Milk Makeup's momentum was also reinforced by securing 22 year-to-date product awards as of the H1 2025 update.

Digital engagement and social media marketing to maintain indie brand DNA

Maintaining the entrepreneurial, indie brand DNA relies heavily on digital resonance and innovation recognition. Milk Makeup's strong U.S. sell-out performance in Q2 2025 was fueled by retail expansion into Ulta Beauty and the Amazon Premium Beauty launch. The brand's innovation was highlighted by the return of the blockbuster Hydro Grip Gel Skin Tint and the success of Balmade Electrolyte Lip Balm. The company's overall strategy is brand-led, ensuring proximity to customers while maintaining each brand's distinct DNA.

Key metrics reflecting digital and brand resonance:

• Milk Makeup secured 22 product awards year-to-date as of H1 2025.
• Obagi Medical achieved the leading position in unaided brand awareness within its competitive set by H1 2025.

Finance: draft 13-week cash view by Friday.

Waldencast plc (WALD) - Canvas Business Model: Channels

You're looking at how Waldencast plc (WALD) gets its products-Obagi Medical and Milk Makeup-into the hands of customers as of late 2025. The strategy is clearly segmented across professional, direct-to-consumer, and retail partners.

For Obagi Medical, the Physician Dispense channel saw a dip in the first quarter of 2025, largely due to ongoing supply chain restructuring and temporary inventory constraints that limited sales during that period. However, by the third quarter of 2025, revenue for Obagi Medical reached $42.6 million, reflecting an acceleration in this channel as previous supply chain constraints began to improve in the second quarter.

The U.S. specialty retail stores channel is a key focus for Milk Makeup. This brand delivered double-digit growth in the second quarter of 2025, driven in part by its retail expansion into Ulta Beauty. Waldencast plc intentionally reduced exposure to non-equity-building distribution points across its portfolio to sharpen focus on sustainable, long-term growth.

Brand-controlled e-commerce websites (DTC) are showing momentum. For Obagi Medical, net revenue in Q1 2025 showed growth fueled by direct-to-consumer channels, with the transition to a first-party model with its primary e-commerce distributor having fully annualized by then. In Q3 2025, U.S. brand controlled e-commerce was noted as a leader in Obagi Medical's strong strategic channel performance.

Online marketplaces are also being utilized, specifically by Milk Makeup, which saw its Q2 2025 growth boosted by the brand's launch on Amazon Premium Beauty.

International distribution partners and direct international markets are a significant growth area, particularly for Obagi Medical. International acceleration in the second quarter of 2025 was in the mid-40s, following launches in the Middle East and the Nordics. By Q3 2025, international markets, including the U.K., Middle East, and Southeast Asia, contributed to Obagi Medical's double-digit growth. To be fair, Milk Makeup faced softness in international markets during Q3 2025.

Here's a look at the revenue performance across the portfolio for the periods where data is available:

The Physician Dispense channel for Obagi Medical shows a clear shift in performance within the year:

• Q1 2025: Declined due to supply chain restructuring.
• Q3 2025: Accelerated as previous supply chain constraints began to improve in Q2.

The overall strategy is to focus on channels that build the brand equity. Waldencast plc expects its full Fiscal Year 2025 revenue to be broadly in line with 2024 revenue, which was $273.9 million.

Waldencast plc (WALD) - Canvas Business Model: Customer Segments

The customer base for Waldencast plc is segmented across its two primary brands, reflecting distinct professional and direct-to-consumer pathways.

For the three months ended September 30, 2025, Waldencast plc reported total Net Revenue of $67.8 million, which represented a decrease of 3.4% year-over-year.

The Obagi Medical segment targets dermatologists, plastic surgeons, and medical aesthetic practitioners, as its products are available through these professional channels, which is part of the broader medical-grade segment of the professional skincare market, valued at $12,500 million in 2025.

This segment also captures high-value, loyal consumers seeking advanced, science-backed skincare, evidenced by its continued strength in direct-to-consumer channels, specifically U.S. brand-controlled e-commerce. Obagi Medical achieved the leading position in unaided brand awareness within its competitive set as of Q3 2025. The Physician Dispense channel saw performance temporarily muted as the company upgraded go-to-market capabilities ahead of the launch into the aesthetics market with Obagi Saypha®.

The Gen Z and Millennial consumers focused on clean, conscious, and trend-aware makeup are the core of the Milk Makeup customer base. Year-to-date 2025 U.S. consumption for Milk Makeup increased 12% against 2024, which is quadruple the rate of growth of the prestige makeup market.

General market data for Gen Z consumers, who are expected to comprise 40% of global consumers by 2025, indicates specific preferences that influence this segment:

• 61.1% wish there were more clean label options available.
• 73% prefer brands transparent about ingredients and committed to ethical sourcing.
• 56.2% are willing to pay more for sustainable or ethically sourced products.
• 55% prioritize affordability when choosing beauty products.

Global beauty and wellness consumers in key international markets represent a mixed picture across the portfolio. Obagi Medical showed strong growth in international markets, including the U.K., Middle East, and Southeast Asia. Conversely, Milk Makeup experienced softer consumption in international markets, which contributed to its year-on-year net revenue decline in Q3 2025.

The platform as a whole serves global beauty and wellness consumers, benefiting from the expertise in managing global beauty brands at scale.

Waldencast plc (WALD) - Canvas Business Model: Cost Structure

You're looking at the expenses Waldencast plc incurs to keep its multi-brand platform running and growing, especially after major strategic moves like the Novaestiq acquisition. Honestly, the cost structure reflects a premium positioning and aggressive investment cycle.

High cost of goods sold (COGS) is inherent given the focus on premium ingredients and brand positioning. For the first quarter of 2025, the Adjusted Gross Profit stood at $50.0 million, representing 76.4% of net revenue for that period. To give you a broader view, for the first half of 2025, the Adjusted Gross Profit was $98.1 million, which was 74.1% of net revenue, a contraction of 150 basis points year-over-year, partly due to higher off-price sales as they worked on inventory quality. For context on COGS itself, for the six months ended June 30, 2024, the Cost of goods sold was $37.4 million.

Sustained investment in sales and marketing (S&M) is definitely a major cost driver to fuel brand equity. In Q1 2025, the Adjusted EBITDA margin declined by 370 basis points year-over-year, which the company attributed primarily to higher marketing investments and increased supply chain costs aimed at supporting future growth. This pressure continued, as the margin contraction in one segment was driven by increased marketing investments and G&A deleverage resulting from lower sales.

Operating expenses reflect platform management and the impact of deleverage. Selling, General, and Administrative (SG&A) expense for the six months ended June 30, 2024, totaled $119.9 million. Furthermore, non-recurring expenses related to clean-up activities were still present, with legal and advisory expenses totaling $1.5 million in Q1 2025.

Financing costs are a clear line item. Interest expense on net debt, which totaled $172.1 million as of Q1 2025, is a significant fixed cost. For the six months ended June 30, 2024, the reported Interest expense, net was $8.7 million.

Strategic investment costs for integration and transformation are also materializing. Waldencast plc made significant investments in H1 2025, including priorities at Obagi Medical like the integration of Novaestiq and supply chain restructuring. These strategic shifts resulted in substantial non-cash charges; for H1 2025, the company recorded goodwill impairment charges of $132.1 million for Obagi Medical and $20.0 million for Milk Makeup.

Here's a quick look at some key expense and margin metrics for recent periods:

You'll want Finance to track the ongoing cash burn from these investments against the new credit facility secured in Q1 2025, which includes a $175 million term loan and a $30 million revolving credit facility.

Waldencast plc (WALD) - Canvas Business Model: Revenue Streams

You're looking at how Waldencast plc brings in the cash, and honestly, it's a mix of ongoing product sales and some significant one-time events shaping the 2025 picture.

The core revenue generation comes from the two main brand segments you're tracking. For the third quarter of 2025, product sales from Obagi Medical, covering their skincare and injectables lines, hit $42.6 million.

Simultaneously, Milk Makeup, focused on color cosmetics, contributed $25.2 million in product sales for that same Q3 2025 period. These product sales are the recurring engine, you see.

Looking at the year-to-date performance, the Net Revenue for the first three quarters of 2025 totaled $200.0 million. This cumulative figure is built from the quarterly results: $65.4M plus $66.8M plus $67.8M.

We also have to account for a substantial, non-recurring cash event. Waldencast plc realized a one-time cash inflow from the sale of the Obagi Japan trademark, which brought in $82.5 million.

For the full-year outlook, the guidance for Net Revenue for 2025 projects low to mid-single digit growth. That's the expectation for the total top line, excluding that big trademark sale.

Here's a quick look at the revenue components we have data for, which helps map out where the money is defintely coming from:

The primary streams feeding the top line are clearly product sales, which you can break down further:

• Product sales from Obagi Medical (skincare, injectables).
• Product sales from Milk Makeup (color cosmetics).

The year-to-date Net Revenue breakdown shows a slight sequential increase across the first three quarters:

• Q1 2025 Net Revenue: $65.4M.
• Q2 2025 Net Revenue: $66.8M.
• Q3 2025 Net Revenue: $67.8M.