Adore Beauty Group Ltd (ASX: ABY) shares are having a mixed session on Monday.

After being up as much as 5%, the ASX growth stock is on course to end the day flat.

This follows the release of the online (and now offline) beauty retailer's half year results.

ASX growth stock flat on results day

• Revenue up 2.3% to $103 million
• Gross margin up 270 basis points to 36.2%,
• EBITDA up 98% to $4.7 million (EBITDA margin of 4.5%)
• EBIT up 126% to $2.8 million
• Cash Balance of $11.7 million with no debt
• Outlook: EBITDA margin guidance of 4%-5%, EBIT margin guidance of 2%-3% reaffirmed

What happened during the half?

Adore Beauty reported a strong half year result on Monday, delivering a significant lift in earnings as its new three-year strategy starts to show promise.

For the six months ended 31 December, the company revealed a 2.3% increase in revenue to $103 million. This was driven partly by a 20% increase in Adore Beauty's contactable customer database to 1.26 million.

The ASX growth stock reported EBITDA of $4.7 million for the half, which is a whopping 98% increase on the prior corresponding period. EBIT surged by 126% to $2.8 million, which management advised reflects disciplined cost management and higher-margin revenue streams.

Expanding offline

The company recently launched its first physical retail store at Westfield Southland in Victoria, with another opening in March at Watergardens. It plans to roll out up to six more stores in 2025, expanding into Western Australia, New South Wales, and Queensland.

iKOU, its premium skincare brand, will also grow its retail footprint, with a flagship Melbourne store opening in April.

This is all part of the company's plan to deliver strong revenue growth and higher margins. Adore Beauty is targeting 30% revenue growth and a doubling of EBIT margins over three years.

In the near term, despite macroeconomic challenges, management remains confident in its outlook and has reaffirmed its FY 2025 EBITDA margin guidance of 4% to 5% and EBIT margin guidance of 2% to 3%.

Management commentary

The ASX growth stock's CEO, Sacha Laing, was pleased with the company's performance. He said:

Our half-year results demonstrate the strength of the Adore Beauty brand and the early momentum of our strategy refresh focusing in the near-term on enhancing quality of earnings and optimising our operating model. I am delighted with the demonstrated gains in gross margin which delivered material improvement and the subsequent 126% growth in EBIT in the half. This is just the start for us as we accelerate the execution of our strategic levers, including the opening of additional retail stores across Australia.