A downtrend has been apparent in Torrid Holdings (CURV) lately with too much selling pressure. The stock has declined 28.2% over the past four weeks. However, given the fact that it is now in oversold territory and Wall Street analysts are majorly in agreement about the company's ability to report better earnings than they predicted earlier, the stock could be due for a turnaround.We use Relative Strength Index (RSI), one of the most commonly used technical indicators, for spotting whether a stock is overso ...

Market Overview - U.S. stocks showed mixed performance with the Dow Jones index falling approximately 0.2% to 43,011.70, while the NASDAQ rose by 0.20% to 19,953.27 and the S&P 500 increased by 0.02% to 6,093.14 [1] - Information technology shares experienced a notable increase of 0.8%, while real estate stocks declined by 1.3% [1] Commodities - Crude oil prices rose by 2.5% to $65.99, gold increased by 0.3% to $3,343.80, silver was up 1% to $36.070, and copper rose by 0.7% to $4.9605 [5] European Markets - European shares were generally lower, with the eurozone's STOXX 600 falling by 0.74%, Spain's IBEX 35 Index down 1.59%, London's FTSE 100 down 0.46%, Germany's DAX 40 down 0.61%, and France's CAC 40 slipping by 0.76% [6] Asian Markets - Asian markets closed higher, with Japan's Nikkei gaining 0.39%, Hong Kong's Hang Seng Index up 1.23%, China's Shanghai Composite rising 1.04%, and India's BSE Sensex increasing by 0.85% [7] Company News - Plus Therapeutics, Inc. saw its shares surge by 59% to $0.2968 following FDA clearance for its investigational new drug application for REYOBIQ [9] - QuantumScape Corporation's shares rose by 36% to $5.88 after achieving a key milestone in integrating its advanced Cobra separator process [9] - SeaStar Medical Holding Corporation's shares increased by 49% to $0.5362 due to strategic actions for Nasdaq compliance [9] - Lifeward Ltd. experienced a drop of 38% to $0.6015 after announcing a public offering of 4 million shares at $0.65 per share [9] - Torrid Holdings Inc. shares fell by 37% to $3.1900 following the pricing of a secondary offering of 10 million shares at $3.50 per share [9] - Allot Ltd. shares decreased by 17% to $8.01 after announcing a public offering of 5 million shares at $8.00 per share [9] Economic Indicators - Sales of new single-family homes in the U.S. decreased by 13.7% to an annualized rate of 623,000 units in May [11] - U.S. building permits fell by 2% to an annualized rate of 1.394 million in May [11] - The volume of mortgage applications in the U.S. increased by 1.1% from the previous week [11] - U.S. crude oil inventories declined by 5.836 million barrels, significantly exceeding market estimates of a 0.75 million barrel decrease [11]

[PART I — FINANCIAL INFORMATION](index=5&type=section&id=PART%20I%20%E2%80%94%20FINANCIAL%20INFORMATION) [Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) Unaudited Q1 2025 financial statements show decreased net sales and net income, with negative operating cash flow [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to **$451.4 million** due to lower cash, while total liabilities fell and stockholders' deficit improved Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | May 3, 2025 | February 1, 2025 | Change | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | $23,693 | $48,523 | ($24,830) | | Inventory | $149,570 | $148,493 | $1,077 | | **Total Assets** | **$451,378** | **$488,441** | **($37,063)** | | Total current liabilities | $232,008 | $263,132 | ($31,124) | | Noncurrent debt, net | $268,373 | $272,409 | ($4,036) | | **Total Liabilities** | **$635,199** | **$679,530** | **($44,331)** | | **Total stockholders' deficit** | **($183,821)** | **($191,089)** | **$7,268** | [Condensed Consolidated Statements of Comprehensive Income](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) Q1 2025 net sales decreased **4.9%** to **$266.0 million**, resulting in a **51.2%** drop in net income to **$5.9 million** Q1 2025 vs. Q1 2024 Income Statement (in thousands, except per share data) | Metric | Q1 2025 (ended May 3) | Q1 2024 (ended May 4) | YoY Change | | :--- | :--- | :--- | :--- | | Net sales | $265,965 | $279,771 | -4.9% | | Gross profit | $101,402 | $115,421 | -12.1% | | Income from operations | $16,027 | $26,143 | -38.7% | | **Net income** | **$5,940** | **$12,172** | **-51.2%** | | **Diluted EPS** | **$0.06** | **$0.12** | **-50.0%** | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2025 operating activities used **$18.0 million** cash, a significant shift from prior year's positive flow, mainly due to working capital changes Cash Flow Summary (in thousands) | Activity | Q1 2025 (ended May 3) | Q1 2024 (ended May 4) | Change | | :--- | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | ($18,015) | $27,624 | ($45,639) | | Net cash used in investing activities | ($2,547) | ($7,008) | $4,461 | | Net cash used in financing activities | ($4,674) | ($11,859) | $7,185 | | **(Decrease) increase in cash** | **($24,830)** | **$8,730** | **($33,560)** | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail revenue by product, debt structure including **$288.75 million** outstanding, and **$4.0 million** accrued for a class action settlement - Apparel sales constitute the vast majority of revenue, totaling **$239.8 million** in Q1 2025, down from **$252.6 million** in Q1 2024[42](index=42&type=chunk) - As of May 3, 2025, total debt outstanding under the Amended Term Loan Credit Agreement was **$288.75 million**, with an interest rate of approximately **10%**. Availability under the ABL Facility was **$117.3 million**[58](index=58&type=chunk)[60](index=60&type=chunk)[62](index=62&type=chunk) - The company has accrued a **$4.0 million** estimated loss for a proposed settlement in a class action lawsuit regarding pricing and sales practices. Two other class action lawsuits are pending, one related to a data breach and another concerning website terms and pricing practices, for which potential losses are not yet determinable[66](index=66&type=chunk)[67](index=67&type=chunk)[68](index=68&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=20&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Q1 net sales decreased **4.9%** due to lower transactions, gross profit margin contracted to **38.1%**, and Adjusted EBITDA declined to **$27.1 million** [Key Financial and Operating Metrics](index=20&type=section&id=Key%20Financial%20and%20Operating%20Metrics) Comparable sales declined **4%** in Q1 2025, an improvement from prior year, while Adjusted EBITDA fell to **$27.1 million** and store count decreased to **632** Key Metrics Comparison | Metric | Q1 2025 (ended May 3) | Q1 2024 (ended May 4) | | :--- | :--- | :--- | | Number of stores | 632 | 658 | | Comparable sales | (4)% | (9)% | | Net income (in thousands) | $5,940 | $12,172 | | Adjusted EBITDA (in thousands) | $27,128 | $38,227 | [Results of Operations](index=24&type=section&id=Results%20of%20Operations) Q1 2025 saw net sales fall **4.9%**, gross profit decrease **12.1%**, and income from operations drop **38.7%**, despite an **8.4%** decrease in SG&A - Net sales decreased by **$13.8 million (4.9%)** primarily due to decreases in sales transactions and transaction values. The total store count also decreased by **26 stores** year-over-year[109](index=109&type=chunk) - Gross profit margin decreased by **3.2 percentage points** to **38.1%**, driven by the decrease in net sales and an increase in merchandising payroll costs[110](index=110&type=chunk) - SG&A expenses decreased by **$6.5 million (8.4%)**, mainly from lower payroll, bonus, and store operating costs[111](index=111&type=chunk) - Marketing expenses increased by **$2.5 million (19.9%)** due to higher spending on social media, retargeting, and photographic production[112](index=112&type=chunk) [Liquidity and Capital Resources](index=25&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity relies on cash from operations and its ABL Facility, with **$23.7 million** cash and **$117.3 million** available credit as of May 3, 2025 - As of May 3, 2025, the company had **$23.7 million** in cash and cash equivalents[117](index=117&type=chunk) - The company has access to an additional **$117.3 million** in liquidity from its ABL Facility, net of outstanding letters of credit[117](index=117&type=chunk) - Primary cash needs include merchandise inventories, payroll, rent, capital expenditures, and debt service payments[124](index=124&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=27&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's market risk profile has not materially changed from its prior fiscal year 2024 Annual Report on Form 10-K - There have been no material changes to the company's market risk profile as of May 3, 2025[135](index=135&type=chunk) [Controls and Procedures](index=28&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including CEO and CFO, concluded disclosure controls were effective as of May 3, 2025, with no material changes to internal control over financial reporting - The CEO and CFO concluded that disclosure controls and procedures were effective as of the end of the quarter[137](index=137&type=chunk) - No changes occurred during the fiscal quarter that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[138](index=138&type=chunk) [PART II — OTHER INFORMATION](index=29&type=section&id=PART%20II%20%E2%80%94%20OTHER%20INFORMATION) [Legal Proceedings](index=29&type=section&id=Item%201.%20Legal%20Proceedings) The company is not party to any legal proceedings expected to have a material adverse effect on its business - The company is subject to legal proceedings in the ordinary course of business but does not believe any will have a material adverse effect[141](index=141&type=chunk) [Risk Factors](index=29&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred to the risk factors previously disclosed in the company's 2024 Form 10-K - No material changes to the risk factors disclosed in the 2024 Form 10-K have occurred[142](index=142&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=29&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities during the period - None[143](index=143&type=chunk) [Other Information](index=29&type=section&id=Item%205.%20Other%20Information) No director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during Q1 2025 - During the fiscal quarter ended May 3, 2025, no director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement[147](index=147&type=chunk) [Exhibits](index=30&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO/CFO certifications and Interactive Data Files (Inline XBRL)

Group 1 - The article emphasizes a long-only investment strategy that evaluates companies from an operational and buy-and-hold perspective, focusing on long-term earnings power and competitive dynamics rather than market-driven price actions [1] - Quipus Capital's approach suggests that most investment calls will be holds, indicating a cautious stance in a bullish market, with only a small fraction of companies deemed suitable for buying at any given time [1] - The hold articles are intended to provide valuable information for future investors and introduce a healthy skepticism towards the prevailing market optimism [1] Group 2 - The article does not disclose any stock, option, or derivative positions in the mentioned companies, nor does it plan to initiate any such positions in the near future [2] - The opinions expressed in the article are solely those of the author and are not influenced by any business relationships with the companies discussed [2] - Seeking Alpha clarifies that past performance does not guarantee future results and that the views expressed may not reflect the overall stance of the platform [3]

Group 1 - Torrid Holdings (NYSE: CURV) is undergoing a significant transition as a direct-to-consumer retailer focused on clothing and accessories for 'curvy women' [1] - The company is positioned within a niche market that caters specifically to a demographic often underserved in the fashion industry [1] Group 2 - The investment service provided by Crude Value Insights emphasizes cash flow and the potential for value and growth in oil and natural gas companies [2] - Subscribers have access to a comprehensive stock model account and in-depth cash flow analyses of exploration and production firms [2] - The service includes live chat discussions about the sector, enhancing community engagement and information sharing [2]

Core Viewpoint - Torrid Holdings reported quarterly earnings of $0.06 per share, exceeding the Zacks Consensus Estimate of $0.05 per share, but down from $0.12 per share a year ago, indicating a 20% earnings surprise [1][2] Financial Performance - The company posted revenues of $265.97 million for the quarter ended April 2025, missing the Zacks Consensus Estimate by 1.36% and down from $279.77 million year-over-year [2] - Over the last four quarters, Torrid Holdings has surpassed consensus EPS estimates three times and topped consensus revenue estimates two times [2] Stock Performance - Torrid Holdings shares have declined approximately 2.7% since the beginning of the year, while the S&P 500 has gained 1.5% [3] - The current consensus EPS estimate for the upcoming quarter is $0.08 on revenues of $279.17 million, and for the current fiscal year, it is $0.15 on revenues of $1.09 billion [7] Industry Outlook - The Retail - Apparel and Shoes industry, to which Torrid Holdings belongs, is currently ranked in the bottom 42% of over 250 Zacks industries, which may impact stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that investors should monitor these revisions closely [5][6]

Financial Data and Key Metrics Changes - The company reported net sales of $266 million for Q1, down from $279.8 million in the prior year, with comparable store sales declining by 3.5% [20][24] - Gross profit decreased to $101.4 million from $115.4 million, with gross margin declining by 320 basis points to 38.1% due to planned promotional initiatives [24][25] - Adjusted EBITDA was $27.1 million, representing a 10.2% margin, down from $38.2 million and 13.7% in the previous year [27] - Net income for the quarter was $5.9 million, or $0.06 per share, compared to $12.2 million, or $0.12 per share, in the prior year [26] Business Line Data and Key Metrics Changes - The performance of sub-brands such as Festi, Belle Isle, Nightfall, and Retro Chic exceeded expectations, achieving sales 2 to 6 times higher than planned [7] - Online sales demand is approaching 70% of total sales, with expectations to reach 75% by 2026 [9] - The company plans to increase the delivery frequency of existing sub-brands from 6-8 times a year to 12 times annually, aiming for sub-brands to represent up to 30% of the portfolio by 2026 [8] Market Data and Key Metrics Changes - The company closed 35 stores in 2024 and plans to close approximately 180 stores in 2025, with 60 stores targeted for closure in the first half of the year [10][29] - The closures are expected to have a negligible impact on net sales, as the company retains approximately 60% of customers post-closure [10][29] Company Strategy and Development Direction - The company is focusing on enhancing product assortment, driving customer growth, and executing a store optimization plan [6] - A strategic shift towards online sales is evident, with plans to optimize the retail footprint to align with customer preferences for online shopping [12][60] - The company is diversifying sourcing to reduce exposure to China, with current exposure in the low single digits [13] Management's Comments on Operating Environment and Future Outlook - Management noted that consumer behavior remains price and value-conscious, but there is a positive response to new product offerings [20] - The company expects to mitigate approximately $20 million of tariff impact through expense reductions and strategic marketing investments [32] - The outlook for fiscal 2025 includes a revenue impact of approximately $40 million to $45 million due to the pause in the footwear business [31] Other Important Information - The company ended the quarter with $23.7 million in cash and access to $117.3 million in additional liquidity [21] - Inventory totaled $149.6 million, a 3.3% increase year-over-year, with expectations for a decrease in year-end comparable store inventory [28] Q&A Session Summary Question: Could you talk about the cadence of newness for the second half? - The company plans to launch a new sub-brand, Lovesick, in August and Studio Luxe in September, with existing brands being delivered monthly by the end of the year [38] Question: What trends are being seen with new customers following their initial sub-brand purchase? - Positive movement in customer acquisition and reactivation has been observed, with a high attachment rate of 90% for sub-brand purchasers adding core products to their baskets [42][44] Question: What is the reason for the sizable sales growth deceleration in Q2? - The pause in the shoe business, primarily sourced from China, is expected to impact sales by $40 million to $45 million for the year [48][49] Question: How does the promotional strategy coexist with new product launches? - The company will continue its typical promotional cadence, responding to consumer value orientation with promotional events [56] Question: What is behind the acceleration in store closures? - The preference for online shopping has led to a decision to close underperforming stores while reallocating resources to digital investments [60][61]

Financial Data and Key Metrics Changes - The company reported net sales of $266 million for Q1, down from $279.8 million in the prior year, with comparable store sales declining by 3.5% [20][24] - Gross profit decreased to $101.4 million from $115.4 million, with gross margin declining by 320 basis points to 38.1% due to planned promotional initiatives [25][26] - Adjusted EBITDA was $27.1 million, representing a 10.2% margin, compared to $38.2 million and 13.7% in the previous year [28] - Net income for the quarter was $5.9 million, or $0.06 per share, down from $12.2 million, or $0.12 per share, in the prior year [27] Business Line Data and Key Metrics Changes - The performance of sub-brands such as Festi, Belle Isle, Nightfall, and Retro Chic exceeded expectations, achieving sales 2 to 6 times higher than planned [6] - Online sales demand is approaching 70% of total sales, with expectations to reach 75% by 2026 [9] - The company plans to increase the delivery frequency of existing sub-brands from 6-8 times a year to 12 times annually, aiming for sub-brands to represent up to 30% of the portfolio by 2026 [7] Market Data and Key Metrics Changes - The company closed 35 stores in 2024 and plans to close approximately 180 stores in 2025, with 60 closures targeted in the first half of the year [10][30] - The closures are expected to have a negligible impact on net sales, as the company retains about 60% of customers post-closure [11][30] Company Strategy and Development Direction - The company is focusing on enhancing product assortment, driving customer growth, and executing a store optimization plan [5] - A strategic shift towards online sales is evident, with plans to optimize the retail footprint to better align with customer demand [12][36] - The company is diversifying sourcing to reduce exposure to China, with current exposure in the low single digits [13] Management's Comments on Operating Environment and Future Outlook - Management noted that consumer behavior remains price and value-conscious, but there is a positive response to new product offerings [20] - The company expects to mitigate approximately $20 million of tariff impact through expense reductions and strategic marketing investments [31] - The outlook for fiscal 2025 includes net sales guidance of $1.03 billion to $1.055 billion, reflecting the pause in the footwear business [31] Other Important Information - The company ended the quarter with $23.7 million in cash and access to $117.3 million in additional liquidity [21] - Inventory totaled $149.6 million, a 3.3% increase year-over-year, with expectations for a decrease in comparable store inventory by mid to high single digits by year-end [29] Q&A Session Summary Question: Can you discuss the cadence of new product launches for the second half? - The company plans to launch a new sub-brand, Lovesick, in August and Studio Luxe in September, with existing brands launching monthly by year-end [40] Question: What trends are seen with new customers following their initial sub-brand purchase? - Positive movement in customer acquisition and reactivation is noted, with a high attachment rate of 90% for core products purchased alongside sub-brands [44][46] Question: Why is there a sizable sales growth deceleration expected in Q2? - The pause in the shoe business, primarily sourced from China, is expected to impact sales by approximately $40 million to $45 million for the year [50][51] Question: How does the promotional strategy coexist with new product launches? - The company will maintain a promotional cadence, responding to consumer value orientation while continuing to drive newness through product launches [58] Question: What is the rationale behind the acceleration of store closures? - The shift towards online shopping preferences among customers necessitates the closure of underperforming stores, allowing for resource reallocation to digital investments [62]

Torrid First Quarter 2025 Financial Results [Performance Overview](index=1&type=section&id=Performance%20Overview) Torrid's Q1 2025 results met expectations, driven by successful sub-brand strategy, accelerated digital transformation, and planned store optimization - The sub-brand strategy is delivering positive results, exceeding expectations and is anticipated to represent nearly **one-third of the business by 2026**[3](index=3&type=chunk) - The company is accelerating its transformation to a more digitally-led business, as the digital channel now accounts for almost **70% of total demand**[3](index=3&type=chunk) - Torrid plans to close up to **180 underperforming stores** in the current year to reduce fixed costs and reinvest in long-term growth areas[3](index=3&type=chunk) - The company leverages a strong customer connection, with **95% of its customers** engaged in its loyalty program[3](index=3&type=chunk) [Financial Highlights for the First Quarter of Fiscal 2025](index=1&type=section&id=Financial%20Highlights%20for%20the%20First%20Quarter%20of%20Fiscal%202025) Torrid's Q1 2025 saw net sales decline by 4.9% to $266.0 million, with significant drops in net income and Adjusted EBITDA Q1 2025 vs Q1 2024 Key Metrics | Metric | Q1 2025 (Three Months Ended May 3, 2025) | Q1 2024 (Three Months Ended May 4, 2024) | Change | | :--- | :--- | :--- | :--- | | Net Sales | $266.0 million | $279.8 million | -4.9% | | Comparable Sales | -3.5% | -9.0% | N/A | | Gross Profit Margin | 38.1% | 41.3% | -320 bps | | Net Income | $5.9 million | $12.2 million | -51.4% | | Diluted EPS | $0.06 | $0.12 | -50.0% | | Adjusted EBITDA | $27.1 million | $38.2 million | -29.0% | | Store Count (End of Period) | 632 | 658 | -26 stores | [Balance Sheet and Cash Flow](index=2&type=section&id=Balance%20Sheet%20and%20Cash%20Flow) Q1 2025 ended with $23.7 million in cash and $141.0 million in liquidity, with operating activities shifting to a net cash usage of $18.0 million - Cash and cash equivalents totaled **$23.7 million** at the end of the first quarter[9](index=9&type=chunk) - Total liquidity, including available borrowing capacity, was **$141.0 million**[9](index=9&type=chunk) - Net cash used in operating activities was **$18.0 million**, a reversal from the **$27.6 million** provided by operating activities in the prior year's first quarter[9](index=9&type=chunk) [Fiscal 2025 Outlook](index=2&type=section&id=Outlook) Torrid updated its FY2025 guidance, projecting net sales of $1.030-1.055 billion and Adjusted EBITDA of $95-105 million, alongside strategic store closures and tariff mitigation Q2 Fiscal 2025 Guidance | Metric | Guidance Range | | :--- | :--- | | Net Sales | $250 million to $265 million | | Adjusted EBITDA | $18 million to $24 million | Full Year Fiscal 2025 Guidance | Metric | Guidance Range | | :--- | :--- | | Net Sales | $1.030 billion to $1.055 billion | | Adjusted EBITDA | $95 million to $105 million | | Capital Expenditures | $10 million to $15 million | - The company plans to close up to **180 stores** to better align with current demand and sales channels[14](index=14&type=chunk) - A net tariff impact of **$20 million** is expected, which will be fully offset by discretionary cost reductions and other optimizations[14](index=14&type=chunk) - A pause in the China-sourced shoe category is projected to reduce 2025 revenue by **$40 million to $45 million** with a neutral EBITDA impact[14](index=14&type=chunk) [Consolidated Financial Statements](index=7&type=section&id=Consolidated%20Financial%20Statements) This section provides unaudited condensed consolidated financial statements for Q1 2025, detailing comprehensive income, balance sheets, and cash flows [Condensed Consolidated Statements of Comprehensive Income](index=7&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20COMPREHENSIVE%20INCOME) Q1 2025 net sales decreased to $266.0 million, resulting in a gross profit of $101.4 million and net income of $5.9 million, or $0.06 per diluted share Condensed Consolidated Statements of Comprehensive Income (Unaudited, In thousands) | | Three Months Ended May 3, 2025 | Three Months Ended May 4, 2024 | | :--- | :--- | :--- | | **Net sales** | **$265,965** | **$279,771** | | Cost of goods sold | 164,563 | 164,350 | | **Gross profit** | **101,402** | **115,421** | | Selling, general and administrative expenses | 70,016 | 76,466 | | Marketing expenses | 15,359 | 12,812 | | **Income from operations** | **16,027** | **26,143** | | Interest expense | 8,161 | 9,377 | | Income before provision for income taxes | 8,572 | 16,656 | | Provision for income taxes | 2,632 | 4,484 | | **Net income** | **$5,940** | **$12,172** | | **Diluted Net earnings per share** | **$0.06** | **$0.12** | [Condensed Consolidated Balance Sheets](index=8&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) As of May 3, 2025, total assets were $451.4 million, with cash at $23.7 million, and total liabilities decreased to $635.2 million Condensed Consolidated Balance Sheets (Unaudited, In thousands) | | May 3, 2025 | February 1, 2025 | | :--- | :--- | :--- | | **Total current assets** | **$202,391** | **$226,166** | | Cash and cash equivalents | $23,693 | $48,523 | | Inventory | $149,570 | $148,493 | | **Total assets** | **$451,378** | **$488,441** | | **Total current liabilities** | **$232,008** | **$263,132** | | **Total liabilities** | **$635,199** | **$679,530** | | **Total stockholders' deficit** | **$(183,821)** | **$(191,089)** | | **Total liabilities and stockholders' deficit** | **$451,378** | **$488,441** | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) Q1 2025 saw net cash used in operating activities of $18.0 million, with total cash and equivalents decreasing by $24.8 million Condensed Consolidated Statements of Cash Flows (Unaudited, In thousands) | | Three Months Ended May 3, 2025 | Three Months Ended May 4, 2024 | | :--- | :--- | :--- | | Net income | $5,940 | $12,172 | | **Net cash (used in) provided by operating activities** | **$(18,015)** | **$27,624** | | **Net cash used in investing activities** | **$(2,547)** | **$(7,008)** | | **Net cash used in financing activities** | **$(4,674)** | **$(11,859)** | | (Decrease) increase in cash, cash equivalents and restricted cash | $(24,830) | $8,730 | | Cash, cash equivalents and restricted cash at beginning of period | $48,922 | $12,134 | | **Cash, cash equivalents and restricted cash at end of period** | **$24,092** | **$20,864** | [Non-GAAP Reconciliation](index=10&type=section&id=Non-GAAP%20Reconciliation) This section reconciles GAAP Net Income to Adjusted EBITDA, showing Q1 2025 Adjusted EBITDA of $27.1 million from a Net Income of $5.9 million Reconciliation of Net Income to Adjusted EBITDA (In thousands) | | Three Months Ended May 3, 2025 | Three Months Ended May 4, 2024 | | :--- | :--- | :--- | | **Net income** | **$5,940** | **$12,172** | | Interest expense | 8,161 | 9,377 | | Interest income, net of other (income) expense | (706) | 110 | | Provision for income taxes | 2,632 | 4,484 | | Depreciation and amortization | 9,394 | 9,259 | | Share-based compensation | 1,469 | 1,658 | | Noncash deductions and charges | 52 | (58) | | Other expenses | 186 | 1,225 | | **Adjusted EBITDA** | **$27,128** | **$38,227** |

Store Operations - Torrid operates 634 stores across the U.S., Puerto Rico, and Canada, with an average store size of approximately 3,100 square feet[34]. - The number of stores decreased to 634, down from 655 in the previous year[211]. - The average remaining lease term for the company's stores was 2.7 years as of February 1, 2025, before considering kickout clauses[190]. - Approximately 94% of current leases will have a termination or kickout within three years of the end of fiscal year 2024, providing significant flexibility for the company[190]. Customer Base and Loyalty Programs - The company has a loyal customer base primarily consisting of women aged 30 to 44, with an average size of 18, and approximately half of the customers are under 40 years old[25]. - Torrid's three-tier loyalty program, Torrid Rewards, incentivizes spending, with members earning one point for every dollar spent and rewards for every 250 points collected[26]. - The Torrid Credit Card Program enhances customer loyalty, providing points, discounts, and other perks, while also serving as a valuable source of customer data[27]. - Active customers decreased to 3,656, down from 3,761 in the previous year, representing a decline of 2.8%[211]. - Net sales per active customer decreased to $302, down 1.3% from $306 in the previous year[211]. - The proportion of net sales attributable to active customers remained stable at 97% for fiscal years 2024, 2023, and 2022[213]. Product Development and Merchandising - The company introduces new merchandise approximately 16 times per year, maintaining a consistent flow of fresh products to engage customers[23]. - Torrid employs a data-driven approach to product development, utilizing customer feedback and sales data to inform design and inventory decisions[22]. - The company emphasizes a fashion-first focus and a broad product assortment to differentiate itself in the plus- and mid-size apparel market[60]. - The company has patents issued and applications pending for innovative technologies in its popular bra lines, enhancing its product offerings[56]. Marketing and Brand Strategy - Torrid's marketing strategy emphasizes inclusivity and diversity, targeting curvy women sizes 10 to 30, and includes a multiple brand strategy to reach new customers[44]. - The company focuses on providing stylish apparel for curvy women, specializing in sizes 10 to 30, and aims to keep prices reasonable without compromising quality[209]. Financial Performance - Net income for the fiscal year was $16,318, an increase from $11,619 in the previous year[211]. - Adjusted EBITDA for the fiscal year was $109,120, slightly up from $106,219 in the previous year[211]. - Comparable sales declined by 5% in fiscal year 2024, compared to a 12% decline in fiscal year 2023[211]. - The company's stock price has been volatile, affected by various uncontrollable factors, including changes in business nature and fiscal year[155]. - The company has never declared or paid cash dividends, and future dividend payments will depend on operational results and financial conditions[164]. Supply Chain and Operations - The company has a diversified vendor base, with no single supplier accounting for more than 9% of merchandise purchased in fiscal year 2024[48]. - The company plans to continue diversifying its vendor bases by both vendor and geography, reducing exposure to factories located within China[48]. - The West Jefferson distribution facility, covering 750,000 square feet, is highly automated and supports global direct-to-customer e-Commerce[49]. - The company outsourced its U.S. returns operations to a third-party specialist in late 2024 to improve costs and processing cycle times[50]. - Disruptions in the supply chain due to international trade issues, such as tariffs and political instability, could adversely affect product availability and costs[109]. Regulatory and Compliance Risks - The company is subject to numerous laws and regulations, including labor, tax, and data privacy laws, which could impact operational costs[57]. - Compliance with evolving regulations regarding data protection is critical, as failure to comply could result in fines and reputational damage[101]. - The company is subject to the Payment Card Industry Data Security Standard (PCI-DSS), and any claims of non-compliance could adversely impact its business and reputation[125]. - Changes in product safety laws could result in increased compliance costs and delays in product availability[137]. Economic and Market Conditions - The company's performance is sensitive to economic conditions, with potential declines in consumer spending during recessionary periods impacting net sales and profits[70]. - Recent inflationary pressures have increased costs for energy and raw materials, which may adversely affect sales and operational results if price adjustments cannot be made[72]. - The company faces substantial competition in the plus- and mid-size women's apparel industry, which could adversely affect net sales and margins[76]. - The company faces risks from market fluctuations and economic conditions that could adversely affect its financial performance[159]. Cybersecurity and Technology - The company utilizes an industry-leading cybersecurity framework to assess and manage cybersecurity risks, with a dedicated team led by the COO[179]. - The company has implemented multiple layers of cybersecurity processes and technologies to protect its information systems and mitigate risks[178]. - The company has established a written incident response plan to address cybersecurity events, which includes processes for detection, response, and recovery[182]. Employee and Labor Considerations - The company has approximately 1,810 full-time and 5,780 part-time employees, with a focus on creating a supportive and inclusive work environment[37]. - Employee turnover in the retail industry is generally high, which could lead to increased hiring and training costs, adversely affecting business operations[92]. - Labor costs are influenced by external factors such as unemployment levels and minimum wage laws, which could impact profitability if not managed properly[93].