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Devices to emerge as an additional growth driver

3Q25 preview: Record earnings likely

For 3Q25, we expect APR to report revenue of W367.6bn (+111% YoY) and operating profit of W86.4bn (+217% YoY; OP margin of 23.5%), in line with market expectations. Overseas revenue is likely to expand 196% YoY to W296.4bn (81% of total revenue), driving overall growth. By region/channel, we estimate YoY growth at 242% in the US, 224% in Japan, and 425% through B2B channels.

In particular, we expect the US to contribute W135.5bn in revenue, making it the first region to surpass W100bn in quarterly sales. Growth appears to have been driven largely by Amazon, boosted by the Prime Day event (with Amazon/TikTok Shop sales up 398% YoY). Meanwhile, we estimate offline sales at around W6bn, supported by multiple reorders from Ulta Beauty. Notably, offline sales have exceeded expectations since the initial rollout stage, suggesting ample room for further growth.

Strength in cosmetics coupled with new growth momentum from devices

Cosmetics have fueled APR’s recent growth. Following the success of Zero Pore Pad (a bestseller under the Medicube brand), the company launched a series of new products that also gained strong traction (including PDRN, collagen, and vitamin C products). As a result, overseas cosmetics revenue surged 373% YoY in 1H25. With several of these products having been on the market for less than a year and the company still actively expanding into offline channels, we expect cosmetics momentum to remain strong.

Additionally, devices are likely to serve as a new growth driver. While device sales have lagged behind cosmetics sales (mainly due to intensifying competition in Korea and low product awareness overseas), recent trends point to growing global demand. Momentum is especially visible in Japan, where 1H25 device sales jumped 232% YoY. During Qoo10’s MegaWari sale event in 3Q25, APR’s Age-R Booster Pro became the top-selling item, and its Booster Pro Mini sold out. Device growth is also believed to have accelerated in the US, driven by Prime Day promotions. Two factors appear to be driving this momentum: 1) the cosmetics business has strengthened Medicube’s brand recognition, improving marketing efficiency for devices; and 2) demand for devices (which have relatively high price points) tends to be concentrated in 2H, when promotions pick up. Importantly, APR faces little direct competition in the global aesthetic device market, suggesting strong potential for a valuation premium as sales expand. Recently, the stock has been moving sideways amid softening sector sentiment; we believe this offers a good buying opportunity.