Fashion retailer Revolve's Q3 sales miss estimates

Revolve

04/11/2025 21:13

Overview

Revolve Group Inc Q3 net sales grow 4% yr/yr, missing analyst expectations

Adjusted EBITDA for Q3 beats analyst expectations, rising 45% yr/yr

Net income for Q3 rises 97% yr/yr, reflecting strong profitability

Outlook

Revolve expects FY 2025 gross margin of 53.5%, up from prior 52.1%-52.6%

Company anticipates Q4 2025 gross margin between 53.1% and 53.6%

Revolve sees FY 2025 marketing expenses at 14.6% of net sales

Result Drivers

GROSS MARGIN IMPROVEMENT - Co attributes 347 basis point increase in gross margin to higher mix of full-price and owned brand sales

DATA-DRIVEN STRATEGY - Co's data-driven merchandising strategy cited as a competitive advantage in improving margins

LONG-TERM INVESTMENTS - Co continues to invest in international expansion, new brands, AI, and retail opportunities, supported by strong cash flow

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
Q3 Sales
Miss
$295.63 mln
$297.60 mln (14 Analysts)
Q3 EPS
$0.29
Q3 Net Income
$21.17 mln
Q3 Adjusted EBITDA
Beat
$25.34 mln
$13.90 mln (14 Analysts)
Q3 Gross Margin
54.60%
Q3 Gross Profit
$161.51 mln


Analyst Coverage

The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 9 "strong buy" or "buy", 5 "hold" and 1 "sell" or "strong sell"

The average consensus recommendation for the department stores peer group is "buy"

Wall Street's median 12-month price target for Revolve Group Inc is $25.00, about 14.8% above its November 3 closing price of $21.30

The stock recently traded at 32 times the next 12-month earnings vs. a P/E of 40 three months ago

Press Release: ID:nPn6LL4cXa

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)