Temple & Webster Posts 21% Revenue Growth, EBITDA Up 43% in FY25

• FY25 revenue up 21% to $601 million
• EBITDA increased 43% to $18.8 million with margin improvement
• Market share in Australian furniture and homewares rose to 2.7%
• New Zealand market entry shows promising early traction
• FY26 guidance targets $1 billion revenue and 3-5% EBITDA margin

Strong Financial Performance Amid Challenging Conditions

Temple & Webster Group Ltd (ASX – TPW) reported a solid financial year for FY25, with revenue climbing 21% to $601 million and EBITDA surging 43% to $18.8 million. This translated into an improved EBITDA margin of 3.1%, slightly exceeding the company’s guidance range. The results underscore the resilience of Temple & Webster’s innovative drop-shipping and private label business model, which continues to gain traction despite a tough macroeconomic backdrop.

The company also strengthened its market position, increasing its share of the Australian furniture and homewares market from 2.3% to 2.7%, signaling steady progress toward its ambition of becoming the country’s largest retailer in this category.

Strategic Growth Drivers and Operational Efficiencies

Temple & Webster’s growth was supported by several strategic initiatives. Private label and exclusive drop-ship products now account for 45% of total revenue, up from 43% the prior year, deepening the company’s competitive moat. The business also expanded its use of artificial intelligence technologies, enhancing customer service efficiency, optimising shipping costs, and personalising shopping experiences, which contributed to higher conversion rates.

Cost discipline remains a priority, with fixed costs as a percentage of revenue improving by 70 basis points to 10.6%. This operational leverage allows Temple & Webster to maintain a value-led proposition while growing profitably.

Expanding Horizons – New Zealand Market Entry

In a notable strategic move, Temple & Webster launched operations in New Zealand in October 2025. The New Zealand market, valued at over $3 billion, shares many characteristics with Australia, including low online penetration and a fragmented retail landscape. Early indicators from the launch are encouraging, with revenue surpassing six figures, improving conversion rates, and strong repeat purchase behaviour.

The company expects to invest an incremental $2-3 million in FY26 to support this expansion, with revenue anticipated to ramp up significantly in the second half of FY26 and into FY27. This measured approach aims to refine the company’s international growth strategy while leveraging its proven business model.

Outlook and Governance Enhancements

Looking ahead, Temple & Webster reaffirmed its FY26 guidance, targeting continued revenue growth within its range and an EBITDA margin between 3% and 5%. The company ended FY25 with a strong cash position of $144 million and no debt, enabling flexibility to pursue growth opportunities and maintain an on-market share buy-back program to enhance shareholder returns.

Corporate governance also received attention, with updated policies to improve transparency and accountability. The board welcomed new Non-Executive Director Michael Malone, further strengthening its leadership team.

Overall, Temple & Webster’s FY25 results and strategic initiatives position the company well to capitalize on the substantial $37 billion Australian market opportunity across furniture, homewares, and home improvement, while cautiously exploring international expansion.

Bottom Line?

Temple & Webster’s disciplined execution and strategic expansion set the stage for accelerated growth, but investors will watch closely how the New Zealand venture scales.

Questions in the middle?

• How will Temple & Webster balance investment in New Zealand with profitability targets?
• What impact will increased private label penetration have on supplier relationships and margins?
• Can AI-driven customer experience innovations sustain long-term conversion growth?