Playboy: $33.8M Q3 Loss

Playboy reported a third quarter loss of $33.755 million on revenue of just $12.864 million, compared to a loss of $7.165 million on revenue of $16.276 million in the same quarter last year. The loss came as it further distanced itself from the Honey Birdette lingerie brand and stores.

The sharp decline in overall revenue reflected a decision by Playboy, starting with the third quarter, to consider “the company’s Honey Birdette business as a discontinued operation.” CEO Ben Kohn justified this accounting move saying, during a very brief conference call, that “as we previously stated, we are in process of looking for partners for that business.” In the meantime, however, Playboy continues to own and operate the brand and its stores.

In the second quarter Playboy had reported a dramatic decline at Honey Birdette, noting its revenue had “decreased by $3.8 million, or 21% year-over-year.” By way of comparison, back in 2023, when it was still including Honey Birdette in its financial reporting, Playboy showed a third quarter loss of $15.074 million on revenue of $33.282 million.

When it first announced it was acquiring Honey Birdette, in June of 2021, for “a purchase price of approximately $333 million in cash and stock,” a Playboy press release noted the lingerie label had “60 thriving stores across three countries” and that it expected, from Honey Birdette alone, “$73 million of revenue and approximately $28 million of EBITDA for the twelve months ending June 30, 2021.” As of today the Honey Birdette website lists a total of 54 shops, 11 in the U.S. (California, Florida, Nevada and New Jersey), three in London, and the rest in Australia where the label launched in 2006.

As he announced the third quarter results, Kohn revealed that Playboy had “signed a deal with our existing lenders to restructure our debt, reducing our senior debt from approximately $218 million to approximately $152 million. Related to that, we will issue our lenders $28 million of a new convertible preferred stock.” 

In early November, Playboy also received an investment from Byborg Enterprises SA, a privately held Luxembourg firm that offers “premium online entertainment” and claims “over 70 million daily visitors engaging with” its  streaming and technology products that” facilitate “seamless interaction among people 24/7.” One division is LiveJasmin.com which features a large collection of “live sex cams.” According to Playboy, “Byborg purchased 14.9 million newly issued, unregistered shares of common stock of PLBY Group for a price of $1.50 per share, for a total purchase price of $22.35 million.”

In addition Playboy signed a non-binding letter of intent with Byborg under which the two parties will “work together” to sign a new licensing agreement which could provide Playboy “$20 million in annual minimum guaranteed payments” over 15 years, “for a total of $300 million as well as a profit share based on performance.” This agreement could close before the end of the year.

Kohn explained that existing third quarter licensing revenue was “$7.4 million compared to $10.9 million in the prior year, reflecting a year-over-year decrease of $3.5 million, or 32%. The decrease was attributable to China and the termination of two of the company’s three largest licensing agreements in late 2023. Digital subscriptions and content revenue was $5.5 million, up 5% from $5.2 million in the prior year period.”

Above, a Honey Birdette retail store shown on the company website.