David's Bridal has filed a nonbinding letter of intent to separate its AI platform, Pearl, into a stand-alone company, with the deal expected to close in the first half of 2027. CEO Kelly Cook stated that Pearl, which is projected to generate over $85 million in revenue by 2027 with an EBITDA margin exceeding 30%, will allow both entities to focus on their respective growth strategies.
Pearl's services include an AI-powered wedding-planning platform and a digital content network, which personalize suggestions for clients. The spinoff is seen as a way to refine operations and capitalize on the anticipated $96 billion U.S. wedding services market by 2026.
However, the timing of the IPO is challenging, as the AI sector has faced recent struggles, and investor confidence in AI stocks has waned. Despite past financial difficulties, including two bankruptcy filings, David's Bridal aims to emerge stronger through this strategic split, with Cion Investment Corp. proposing a $25 million investment in Pearl.
Cook emphasized that Pearl's existing customer base and data give it a unique advantage in the market, distinguishing it from other AI companies that are still seeking customers