Company: IPAR
Filing Date: 2025-08-05
Form Type: 10-Q
Source: 0001753926-25-001236
Chunk: 54

Company: INTERPARFUMS INC
Filing Date: 2025-08-05
Form: 10-Q
Item: Part I, Item 7
Chunk 54
---
, as compared to 19.4% and 17.2% for the corresponding periods of the prior year. Promotion and advertising are integral parts of our industry, and we continue to invest heavily to support new product launches and to build brand awareness. We believe that our promotion and advertising efforts have a beneficial effect on sales. As such, the Company is focused on increasing promotional and advertising spending to support the continued success of our brands. Additionally, we continue to develop and implement omnichannel concepts and compelling content to deliver an integrated consumer experience. Long term, we continue to anticipate that on a full year basis, promotion and advertising expenditures will aggregate approximately 21% of net sales.

Page 21

INTERPARFUMS, INC. AND SUBSIDIARIES

Royalty expense included in selling, general and administrative expenses aggregated $27.7 million and $55.8 million for the three and six months ended June 30, 2025, respectively, as compared to $27.0 million and $54.2 million for the corresponding periods of the prior year. Royalty expense represented 8.3% of net sales for both the three and six months ended June 30, 2025 as compared to 7.9% and 8.1% of net sales for the corresponding periods of the prior year. This increase was primarily driven by unfavorable brand mix.
 
Income from Operations
 
As a result of the above analysis regarding net sales, gross profit margins and selling, general and administrative expenses, our operating margins aggregated 17.7% and 20.0% for the three and six months ended June 30, 2025, respectively, as compared to 18.9% and 19.9% for the corresponding period of the prior year.
 
Other Income and Expense

Overall, other income and expense for the six months ended June 30, 2025, was a loss of $6.7 million as compared to a loss of $1.5 million in the corresponding prior year period. The main drivers of this change are discussed in more detail below. One of the main drivers is the impact of our gains and losses on foreign currency where we recognized a loss of $2.4 million in the first half of 2025 compared to a gain of $0.3 million in the first half of 2024. Another driver of