Safilo Group delivered a fourth quarter in which profitability outpaced sales performance, reporting adjusted EBITDA of €19.8 million for Q4 2025 - a 12.4% increase compared with the prior-year period and notably above analysts' consensus of €13.4 million.
Revenue for the quarter totaled €225 million, down 4.6% year-on-year and slightly under the expected €227.4 million. The gap between top-line weakness and stronger earnings was driven in part by a 240 basis-point improvement in gross margin, which rose to 61.9% in the quarter. Management attributed margin gains to successful cost control measures, price adjustments and the relocation of some production away from China, which together largely offset the effects of tariffs.
Regionally, momentum softened. Europe registered a modest improvement of 0.7% after a stronger third quarter. North American sales increased 1.5% in Q4. By contrast, the Asia-Pacific region experienced a double-digit decline following robust performance earlier in the year.
Market reaction was positive: Safilo shares rose 7.6% in Friday morning trading on the news.
Full-year results and balance sheet
For the full year 2025, Safilo reported sales of €983.4 million, a 1.0% decrease versus 2024. Adjusted EBITDA for the year increased 12% to €104.2 million. When measured at constant exchange rates, full-year sales showed 1.8% growth, indicating currency effects weighed on the reported top line.
The company materially lowered net debt during the year, reducing it to €46 million from €82.7 million a year earlier. That reduction came despite two notable uses of cash: a €25 million outlay to acquire a 25% stake in Inspecs and €18 million spent on share repurchases.
Product trends
Within Safilo's brand mix, Smith products returned to growth in physical retail locations during Q4. The group also highlighted that its contemporary and lifestyle portfolio continued to serve as a key driver of growth across channels.
Overall, the quarter illustrated a company that has been able to translate margin improvements and cost discipline into stronger profitability, even as sales growth moderated and regional performance diverged.