#United States #Los Angeles #Sustainable Fashion #Fiscal 2026 #Reformation

Reformation Reports Q3 Fiscal 2026 Results

On November 5, 2026, Reformation Inc. (NYSE: REF), a leading sustainable women's fashion brand, reported its financial results for the third quarter ending September 26, 2026. The results highlight a robust performance, continuing the company’s momentum with a substantial increase in revenue and active customers compared to the previous year.

Financial Highlights

The quarter ended on a strong note, with net revenue climbing by 19.1% to reach $173.6 million. This growth is attributed to the company's success across various channels and geographical expansions. Direct-to-consumer (DTC) revenues accounted for a significant portion, totaling $152.8 million and reflecting a 16.7% increase. Additionally, the wholesale division saw remarkable growth of 40.8%, hitting $20.8 million.

Reformation's gross margin also saw an improvement, rising by 252 basis points to 60.4%. This positive change is a result of lower average tariff rates, higher average unit retail prices, and other strategic economic factors.

While the company reported a net loss of $1.1 million, translating to $(0.02) per share, it is essential to understand that this reflects a 165.9% effective tax rate impacted by stock-based compensation linked to the company's initial public offering (IPO). However, adjusted EBITDA experienced a 64.2% surge, reaching $23.1 million, with an adjusted EBITDA margin of 13.3%, reflecting enhanced operational efficiency.

Customer Growth

Reformation also reported a significant increase in its customer base, with active customers rising 23.4% to 1.25 million. The brand’s efforts to enhance customer acquisition and retention are evidently paying off, underscoring the growing appeal of Reformation's ethos and product offerings. Interestingly, the DTC net revenue per customer slightly declined by 0.5% to $419, indicative of a successful push to attract new customers who typically start with lower spending.

In addition to these successes, Reformation opened seven new stores during the quarter, including a notable reopening of its Palisades location, bringing the total to 77 retail outlets worldwide. The expansion into international markets also added to the success, with international revenue growing by 24.7% to $36.4 million.

Looking Ahead: Fiscal 2026 Outlook

The company’s optimism for the future is reflective of its updated full-year fiscal 2026 outlook. Based on the positive momentum from Q3, Reformation anticipates net revenues will be between $610 million and $612 million, representing a growth range of 20% to 21% year-over-year. They also project an adjusted EBITDA margin of approximately 14.2%. Furthermore, the brand's capital expenditure estimates for 2026 are projected to be between $26 million and $27 million, primarily to support 16 planned new store openings.

Reformation’s focus remains on not just achieving growth but doing so sustainably. The company’s business model combines strategic merchandising with a responsive supply chain, allowing them to deliver trendy products while adhering to environmental standards.

Conclusion

Reformation's Q3 Fiscal 2026 results indicate a flourishing business with continuous growth in revenue and customer engagement. The brand's commitment to sustainable fashion, alongside a robust strategy in place, positions it favorably for future expansion and profitability. Hali Borenstein, Reformation's CEO, stated, "Our strong Q3 results reflect the durability of our business and momentum across our strategic growth pillars," which leaves stakeholders excited about Reformation’s path forward. As the fashion landscape continues to evolve, Reformation stands at the forefront, transforming not just how fashion is perceived, but how it’s produced and consumed.