#United States #Los Angeles #Revolve Group #fashion retailer #Q1 Results

Revolve Group Announces First Quarter 2025 Financial Results

Revolve Group, Inc. (NYSE: RVLV) has made headlines once again with its financial results for the first quarter that ended on March 31, 2025. The company, known for its strong appeal to Millennial and Generation Z shoppers, showcased robust growth numbers that defy the ongoing economic uncertainties.

Co-founders and co-CEOs, Mike Karanikolas and Michael Mente, expressed their pride in the company’s performance, emphasizing the team's hard work and strategic investments in a challenging market. Karanikolas stated, "Our strong execution within a dynamic macro environment resulted in outstanding first-quarter results, highlighted by double-digit top-line growth, 57% growth in operating income year-over-year, and $45 million in operating cash flow that further strengthened our balance sheet."

Mente added, "It is the strength of our team, our solid financial foundation, and our flexibility that we believe position us well to navigate through the current geopolitical and macro-uncertainty while continuing to invest in exciting growth opportunities ahead."

Financial Highlights of Q1 2025

• - Net Sales: Totaled $296.7 million, marking a 10% increase from $270.6 million in Q1 2024.
• - Gross Profit: Achieved $154.3 million, a 9% year-over-year increase.
• - Net Income: Reported at $11.4 million, rising 5% from the previous year’s figures of $10.9 million.
• - Adjusted EBITDA: Demonstrated a significant increase of 45%, surging to $19.3 million compared to $13.3 million in Q1 2024.
• - Operating Cash Flow: Enhanced to $45.1 million, reflecting an 18% increase year-over-year.

The results also indicated that Revolve Group’s active customer count expanded to 2.7 million, a 6% rise from the previous year, while the average order value slightly dipped by 1% to $295. This performance highlights consumer preferences and trends within the fashion space, indicating a steady demand for the company's product offerings.

Despite some fluctuations in gross margin percentages, which slipped to 52.0%, the company's operational efficiencies have remained strong. Fulfillment costs decreased as a percentage of net sales compared to the previous year, reflecting improved operations amid changing customer behaviors, which include lower return rates.

The company also reported that domestic sales were particularly robust, with $239.2 million, representing a 9% growth, while international sales reached $57.5 million, growing by 12%. This indicates a growing global footprint for the brand as it continues to enhance its international reach.

Looking Ahead: Guidance for 2025

As Revolve Group anticipates potential challenges in the macroeconomic environment, it adjusts its forecast for the full year. The company projects gross margins between 50.0% to 52.0%, alongside ongoing efforts to streamline fulfillment and marketing expenses, ensuring a solid profitability trajectory. The outlook considers potential headwinds such as inflation, tariffs, and shifts in consumer spending, indicative of the larger retail environment affecting many brands.

The management will hold a conference call to delve deeper into these results and share strategic insights moving forward. Details for participation will be available on the company's investor relations website, reflecting their continued commitment to transparency and communication.

In summary, Revolve Group's Q1 results not only reveal impressive financial health but also speak volumes about the company’s ability to adapt and thrive in a competitive landscape. As it navigates future growth, the brand remains a significant player in the fashion retail sector, driven by a younger audience's needs and preferences. The team at Revolve Group appears well-prepared to harness the opportunities ahead as they continue to cultivate their unique market position.