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Revolve Group (RVLV) Q1 Earnings Beat, Sales Fall 3% Y/Y
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Revolve Group, Inc. (RVLV - Free Report) came up with first-quarter 2024 results, wherein the top line missed the Zacks Consensus Estimate, while the bottom line beat the same. Both net sales and earnings experienced a year-over-year decline. Markedly, the company registered a meaningful increase in gross margin and variable logistics costs.
RVLV has been strategically working on key initiatives, which in turn, is making strides in improving the foundation for profitable growth. Expanding product categories, improving service internationally, integrating AI technology, enhancing digital merchandising and investing in brand strength are few of the driving factors.
This Zacks Rank #2 (Buy) stock has outperformed the industry in the past three months. Shares of the company have risen 27.7% compared with the industry’s growth of 8.7%.
Image Source: Zacks Investment Research
Q1 Details
Revolve Group, a leading online fashion retailer, delivered earnings of 15 cents per share, which significantly surpassed the Zacks Consensus Estimate of 8 cents. However, the figure declined from earnings of 19 cents reported in the same period past year.
Net sales of $270.6 million decreased 3% from $279.6 million reported in the prior-year quarter. Also, net sales missed the Zacks Consensus Estimate of $271.8 million. The decline was primarily due to lower sales at markdown partially offset by higher sales at full price.
Active customers were 2,551,000 at the end of the first quarter of 2024, which showcased year-over-year improvement of 5%. Total orders decreased 2% to 2,223,000, while average order value jumped 4% to $299.
Gross profit came in at $141.5 million, up 2% year over year. The gross profit margin of 52.3% significantly expanded 250 basis points from 49.8% reported in the year-ago quarter. The factors attributable to a stronger gross margin include higher mix of net sales at full price and lower inventory valuation adjustments in the first quarter of 2024 compared with 2023.
Adjusted EBITDA totalled $13.3 million from $15 million in the first quarter of 2023, reflecting a decrease of 12%. This reduction was primarily due to higher general and administrative expenses, increased marketing investment partially offset by higher gross profit, and efficiencies in selling and distribution costs.
Segment Details
REVOLVE net sales of $229.6 million dipped 1% year over year. Gross profit came in at $127.7 million, up 6% year over year
FWRD net sales of $41 million plunged 15% year over year. Gross profit came in at $13.8 million, declined 27% year over year.
Geographically, domestic net sales decreased 3% year over year to $219.1 million. Furthermore, international net sales came in at $51.5 million, down 3% year over year.
Revolve Group, Inc. Price, Consensus and EPS Surprise
The company ended the quarter with cash and cash equivalents of $273.4 million and stockholders’ equity of $389.9 million. Net cash provided by operating activities amounted to $38.4 million, with free cash flow of $36.7 million.
Outlook
For the second quarter, management foresees gross margin in the band of 53.9-54.4%. Fulfillment expense, selling and distribution expense and marketing expense are expected to be 3.4%, 18% and 17%of net sales, respectively.
For the full year, Revolve Group forecasts gross margin in the range of 52.5-53%. The company anticipates fulfillment expense, selling and distribution expense and marketing expense in the bands of 3.3-3.5%, 17.8%-18% and 16%-16.2% of net sales, respectively. General and administrative expenses are expected in the range of $130-$133 million.
3 Other Picks You Can’t Miss
We have highlighted three other top-ranked stocks, namely American Eagle Outfitters Inc. (AEO - Free Report) , Abercrombie & Fitch Co. (ANF - Free Report) and Gildan Activewear Inc. (GIL - Free Report) .
The Zacks Consensus Estimate for American Eagle Outfitters’ current fiscal-year earnings and sales indicates growth of 58.8% and 5.5% from the year-ago period’s reported figures. AEO has a trailing four-quarter average earnings surprise of 22.7%.
Abercrombie & Fitch, a specialty retailer of premium, high-quality casual apparel, currently holds a Zacks Rank of 2. ANF has a trailing four-quarter average earnings surprise of 715.6%.
The Zacks Consensus Estimate for Abercrombie & Fitch’s current fiscal-year earnings and sales indicates growth of 292.3% and 11.3% from the year-ago period’s reported figures.
Gildan Activewear, a distributer and manufacturer of activewear products, currently carries a Zacks Rank #2. GIL has a trailing four-quarter earnings surprise of 5.8%, on average.
The Zacks Consensus Estimate for Gildan Activewear current fiscal-year earnings and sales suggests an improvement of 19.0% and 1.3%, respectively, from the year-earlier levels.
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Revolve Group (RVLV) Q1 Earnings Beat, Sales Fall 3% Y/Y
Revolve Group, Inc. (RVLV - Free Report) came up with first-quarter 2024 results, wherein the top line missed the Zacks Consensus Estimate, while the bottom line beat the same. Both net sales and earnings experienced a year-over-year decline. Markedly, the company registered a meaningful increase in gross margin and variable logistics costs.
RVLV has been strategically working on key initiatives, which in turn, is making strides in improving the foundation for profitable growth. Expanding product categories, improving service internationally, integrating AI technology, enhancing digital merchandising and investing in brand strength are few of the driving factors.
This Zacks Rank #2 (Buy) stock has outperformed the industry in the past three months. Shares of the company have risen 27.7% compared with the industry’s growth of 8.7%.
Image Source: Zacks Investment Research
Q1 Details
Revolve Group, a leading online fashion retailer, delivered earnings of 15 cents per share, which significantly surpassed the Zacks Consensus Estimate of 8 cents. However, the figure declined from earnings of 19 cents reported in the same period past year.
Net sales of $270.6 million decreased 3% from $279.6 million reported in the prior-year quarter. Also, net sales missed the Zacks Consensus Estimate of $271.8 million. The decline was primarily due to lower sales at markdown partially offset by higher sales at full price.
Active customers were 2,551,000 at the end of the first quarter of 2024, which showcased year-over-year improvement of 5%. Total orders decreased 2% to 2,223,000, while average order value jumped 4% to $299.
Gross profit came in at $141.5 million, up 2% year over year. The gross profit margin of 52.3% significantly expanded 250 basis points from 49.8% reported in the year-ago quarter. The factors attributable to a stronger gross margin include higher mix of net sales at full price and lower inventory valuation adjustments in the first quarter of 2024 compared with 2023.
Adjusted EBITDA totalled $13.3 million from $15 million in the first quarter of 2023, reflecting a decrease of 12%. This reduction was primarily due to higher general and administrative expenses, increased marketing investment partially offset by higher gross profit, and efficiencies in selling and distribution costs.
Segment Details
REVOLVE net sales of $229.6 million dipped 1% year over year. Gross profit came in at $127.7 million, up 6% year over year
FWRD net sales of $41 million plunged 15% year over year. Gross profit came in at $13.8 million, declined 27% year over year.
Geographically, domestic net sales decreased 3% year over year to $219.1 million. Furthermore, international net sales came in at $51.5 million, down 3% year over year.
Revolve Group, Inc. Price, Consensus and EPS Surprise
Revolve Group, Inc. price-consensus-eps-surprise-chart | Revolve Group, Inc. Quote
Other Financial Aspects
The company ended the quarter with cash and cash equivalents of $273.4 million and stockholders’ equity of $389.9 million. Net cash provided by operating activities amounted to $38.4 million, with free cash flow of $36.7 million.
Outlook
For the second quarter, management foresees gross margin in the band of 53.9-54.4%. Fulfillment expense, selling and distribution expense and marketing expense are expected to be 3.4%, 18% and 17%of net sales, respectively.
For the full year, Revolve Group forecasts gross margin in the range of 52.5-53%. The company anticipates fulfillment expense, selling and distribution expense and marketing expense in the bands of 3.3-3.5%, 17.8%-18% and 16%-16.2% of net sales, respectively. General and administrative expenses are expected in the range of $130-$133 million.
3 Other Picks You Can’t Miss
We have highlighted three other top-ranked stocks, namely American Eagle Outfitters Inc. (AEO - Free Report) , Abercrombie & Fitch Co. (ANF - Free Report) and Gildan Activewear Inc. (GIL - Free Report) .
American Eagle Outfitters, a specialty retailer of casual apparel, accessories and footwear, has a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for American Eagle Outfitters’ current fiscal-year earnings and sales indicates growth of 58.8% and 5.5% from the year-ago period’s reported figures. AEO has a trailing four-quarter average earnings surprise of 22.7%.
Abercrombie & Fitch, a specialty retailer of premium, high-quality casual apparel, currently holds a Zacks Rank of 2. ANF has a trailing four-quarter average earnings surprise of 715.6%.
The Zacks Consensus Estimate for Abercrombie & Fitch’s current fiscal-year earnings and sales indicates growth of 292.3% and 11.3% from the year-ago period’s reported figures.
Gildan Activewear, a distributer and manufacturer of activewear products, currently carries a Zacks Rank #2. GIL has a trailing four-quarter earnings surprise of 5.8%, on average.
The Zacks Consensus Estimate for Gildan Activewear current fiscal-year earnings and sales suggests an improvement of 19.0% and 1.3%, respectively, from the year-earlier levels.