Honest Co. Revenue Falls 8.6%, Raises Outlook

The company reported third-quarter revenue of US$84.6 million while raising its full-year forecast and launching a share buyback.

Updated on Nov. 6, 2026 in Organic Food

Honest Co. Revenue Falls 8.6%, Raises Outlook

The Honest Company reported third-quarter revenue of US$84.6 million, an 8.6 percent decline, following its exit from selected business activities and weaker diaper sales. Organic sales rose 9.2 percent to US$79.3 million, and the company raised its full-year guidance.

Why it matters

The decline reflects the company's pruning of certain businesses and softness in diapers, while growth in wipes and personal care helped offset losses. The raised outlook and a new US$30 million share repurchase programme signal management's confidence in its remaining portfolio.

Gross margin improved to 45 percent from 37.3 percent a year earlier, while underlying adjusted net income rose to US$3.1 million. Reported net income of US$91.3 million included a one-off US$89.4 million tax benefit, so underlying profit is far smaller than the headline figure.

The players

The Honest Company

A consumer brand company selling personal care, cleaning and baby products, known for its plant-based and organic positioning in the United States market.

The details

Revenue declined following the company's exit from selected business activities and weaker diaper sales, partially offset by growth across wipes and personal care. The company raised its full-year revenue forecast to US$322-325 million and its adjusted EBITDA guidance to US$25-26 million.

Third quarter (2026): revenue declined 8.6 percent to US$84.6 million.
Full year (2026): raised revenue and adjusted EBITDA guidance announced.

Organic Market Position

The company's organic sales rose 9.2 percent while total revenue fell, showing that its organic and personal care lines are gaining ground within a clean-beauty market that has drawn sustained consumer interest. Its restructuring reflects a shift toward the product categories where its organic positioning is strongest.

Shoppers buying organic and natural personal care and baby products in the United States may see the brand's product mix shift as it exits selected businesses. The raised guidance suggests the company expects its remaining lines to continue supporting sales.

The takeaway

Headline revenue can understate or overstate a company's health when one-time items and portfolio exits are involved, so compare underlying profit and organic growth before drawing conclusions.