Investment Dynamics - Ajinomoto Co., Inc. announced a strategic investment in Australian plant-based protein company v2food, aiming to build a global sustainable protein industry alongside its acquisition of the U.S. brand Daring Foods [3] - v2food's unique "v2 RepliTech™" technology optimizes the taste of plant proteins, and its collaboration with CSIRO enhances its R&D capabilities [3] - v2food plans to leverage Daring Foods' retail network and brand recognition in the U.S. to promote its product range [3] Brand Dynamics - Anta Group signed an agreement with South Korean e-commerce platform Musinsa to establish a joint venture in China, with Anta holding 40% and Musinsa 60% [5] - The joint venture allows Anta to share profits without heavy investment in store openings, reducing expansion risks while retaining options for future equity increases [5] Retail Developments - JD.com plans to open five discount supermarkets in Suqian, Jiangsu, and Zhuozhou, Hebei, marking its first large-scale discount supermarket format in China [8] - The discount supermarkets will feature a large store format with a wide range of SKUs, with the Zhuozhou store covering 5,000 square meters and offering over 5,000 competitively priced daily goods [8] - This move is part of JD.com's strategy to penetrate lower-tier markets, following successful pilot stores in Beijing [8] Real Estate Transactions - JLL announced the sale of eight prime retail properties in Hong Kong, all leased to McDonald's, providing stable income for investors [11] - The total market value of the assets is approximately HKD 1.2 billion, with options for full acquisition or individual bids [12] - The "sell and lease back" model employed by McDonald's may inspire other brands with substantial property holdings to consider similar strategies [12] Market Expansion - Bawang Tea Ji is accelerating its expansion in Asia, planning to enter the Japanese and South Korean markets after establishing a presence in Indonesia, Thailand, and Vietnam [16] - The company aims to leverage the growing consumer power in Asia, particularly among millennials, to replicate the success of coffee in the tea beverage sector [16] Financial Performance - Revolve reported a 9% increase in overall sales for Q2, reaching USD 309 million, with its department sales also growing by 9% to USD 268.4 million [19] - The growth is attributed to an increase in proprietary brand offerings, which help reduce costs and attract consumer attention [19] Collaborations and Product Launches - Starbucks collaborated with fragment design to launch a new beverage, "BBTEA by FRAGMENT," inspired by Hong Kong-style tea, along with a reusable cup featuring the fragment logo [21] - This collaboration emphasizes the creative integration of product offerings, enhancing brand engagement and consumer interest [21] Personnel Changes - Prada Group announced the promotion of Christopher Bugg to Chief Communications Officer, overseeing global communication strategies for the group and its brands [27] - Bugg's appointment is seen as a strategic move to strengthen the group's brand positioning following the acquisition of Versace [27] Board Appointments - a2 Milk Company appointed Grant Dempsey, former CFO of TPG Telecom and with a background in investment banking, to its board [29] - This appointment is viewed as a signal to enhance investor communication quality and provide diverse perspectives for future strategic expansion [29]

Core Insights - Revolve Group reported Q2 fiscal 2025 results with GAAP revenue of $308.97 million, exceeding expectations by $11.3 million, and GAAP EPS of $0.14, slightly above the forecast of $0.13, but down from $0.21 in the prior year [1][2] - The company experienced a 9.4% year-over-year revenue growth, while GAAP net income declined by 35% to $10.0 million due to increased taxes and non-operating costs [1][7] - Active customers increased by 6% year-over-year to 2,743,000, indicating continued customer growth [1] Financial Performance - GAAP revenue for Q2 2025 was $308.97 million, up from $282.5 million in Q2 2024, reflecting a 9.4% increase [2][5] - GAAP net income decreased by 35% year-over-year to $10.0 million, impacted by higher effective tax rates and non-operational expenses [7] - Non-GAAP free cash flow improved to $9.6 million from negative $26.7 million in Q2 2024, indicating a strong cash flow performance [8] Operational Highlights - The gross margin improved slightly to 54.1% from 54.0% in the previous year, driven by a higher mix of owned brand sales [6] - The company reported a 12% increase in non-GAAP adjusted EBITDA to $22.9 million, and operating income rose 10% to $18.0 million [6] - Fulfillment and distribution expenses improved as a share of net sales, attributed to supply chain efficiency [11] Strategic Focus - The company emphasizes expanding its assortment of owned and exclusive brands, enhancing technology, and deepening customer engagement through influencer partnerships [4] - Owned brands are critical for profit margins and customer loyalty, with a focus on differentiating the consumer experience [10] - The company is investing in technology and artificial intelligence to improve merchandising and customer support [4][15] Geographic Performance - International net sales grew by 17%, outpacing domestic growth of 7%, highlighting the company's strategy to diversify away from the U.S. market [12] - The U.S. market contributed $241.6 million in GAAP net sales, reflecting a 7% increase year-over-year [5] Future Guidance - The company raised its full-year GAAP gross margin guidance to 52.1–52.6% for FY2025, up from the previous range of 50.0–52.0% [13] - General and administrative expense guidance for FY2025 is set at $152–$154 million, with expectations for Q3 gross margin in the range of 51.2–51.7% [13]

Core Viewpoint - Revolve Group (RVLV) reported quarterly earnings of $0.14 per share, exceeding the Zacks Consensus Estimate of $0.12 per share, but down from $0.21 per share a year ago, indicating a +16.67% earnings surprise [1] Financial Performance - The company achieved revenues of $308.97 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 4.36% and up from $282.46 million year-over-year [2] - Over the last four quarters, Revolve Group has consistently surpassed consensus EPS estimates and revenue estimates [2] Stock Performance - Revolve Group shares have declined approximately 39.1% since the beginning of the year, contrasting with the S&P 500's gain of 7.6% [3] - The stock's immediate price movement will largely depend on management's commentary during the earnings call [3] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $0.07 on revenues of $294.07 million, and for the current fiscal year, it is $0.41 on revenues of $1.19 billion [7] - The estimate revisions trend for Revolve Group was favorable ahead of the earnings release, resulting in a Zacks Rank 2 (Buy) for the stock, indicating expected outperformance in the near future [6] Industry Context - The Textile - Apparel industry, to which Revolve Group belongs, is currently ranked in the bottom 19% of over 250 Zacks industries, suggesting potential challenges ahead [8] - G-III Apparel Group, another company in the same industry, is expected to report a significant decline in earnings, with a consensus EPS estimate of $0.10, reflecting a year-over-year change of -80.8% [9]

Financial Data and Key Metrics Changes - Net sales increased by 9% year over year, reaching $309 million for the first time in quarterly revenue [29][30] - Adjusted EBITDA rose by 12% year over year, with an adjusted EBITDA margin of 7.4%, the highest in three years [35] - Free cash flow for the first six months of 2025 was $52 million, nearly three times the full-year free cash flow achieved in 2024 [5][36] - Cash and cash equivalents grew to an all-time high of $311 million, a 27% increase year over year [10][37] Business Line Data and Key Metrics Changes - Revolve segment net sales increased by 9% year over year, while FORWARD segment net sales increased by 10% [30] - Domestic net sales grew by 7%, and international net sales increased by 17% year over year [30] - The return rate decreased by more than 1.5 points year over year, contributing to improved profitability [9] Market Data and Key Metrics Changes - International markets showed strong growth, particularly in China, where sales more than doubled over the past two years [12] - The company reported a 17% increase in international net sales, with nearly all regions experiencing double-digit growth [11][30] - The luxury market overall declined year over year, but the company gained market share [7] Company Strategy and Development Direction - The company is focused on expanding brand awareness, growing the customer base, and enhancing connections with the next generation of consumers [10] - Continued investment in owned brands is a priority, as they generate higher margins compared to third-party brands [24] - The company is exploring physical retail opportunities, with plans to open a new store in Los Angeles by the fourth quarter [26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current volatile environment, citing strong cash flow and a solid balance sheet [44] - The company anticipates that tariff mitigation efforts will improve gross margins over the long term [39] - Management noted that while the tariff landscape remains uncertain, recent improvements in tariff mitigation have been promising [39] Other Important Information - The company has successfully implemented AI-driven enhancements to improve the shopping experience and operational efficiency [14][15] - Marketing investments represented 15.2% of net sales, remaining flat year over year [32] - The effective tax rate increased to 33.7% due to certain discrete tax items [34] Q&A Session Summary Question: Can you elaborate on the tariff mitigation efforts and their long-term benefits? - Management indicated that partnerships with brands have been strengthened due to tariff pressures, which should yield long-term benefits [46][47] Question: How should pricing be adjusted in response to tariffs? - Price increases are expected to be mid-single digits in Q3, with adjustments made in line with market trends [49][50] Question: What are the trends in U.S. versus international sales? - International sales showed strong double-digit growth, particularly in China, while U.S. sales increased by 7% [53][57] Question: What is the impact of tariffs on gross margin? - Tariffs had a negative impact in Q2, but this was offset by improvements in markdown margins and owned brand sales [65][66] Question: What progress has been made in reducing return rates? - Management is optimistic about reducing return rates further, although tougher comparisons are expected in the second half of the year [68][69] Question: What advancements have been made in AI initiatives? - The company has made significant progress in AI enhancements, including improvements in search algorithms and customer service technologies [70][72]

Financial Performance - Gross margin for Q2 2025 was 54.1%, slightly up from 54.0% in Q2 2024, while the six-month gross margin was 53.1% compared to 53.2% in the same period last year[97] - Adjusted EBITDA for Q2 2025 reached $22,887,000, an increase from $20,474,000 in Q2 2024, with a six-month total of $42,186,000 compared to $33,741,000 last year[97] - Net income for the three months ended June 30, 2025, was $10,011,000, down 34.5% from $15,377,000 in 2024[107] - Free cash flow for the three months ended June 30, 2025, was $9,607,000, compared to a negative $26,653,000 in 2024[112] - Net sales for the three months ended June 30, 2025, increased by $26,515 thousand, or 9.4%, to $308,971 thousand compared to $282,456 thousand in the same period in 2024[149] - For the six months ended June 30, 2025, net sales increased by $52,643 thousand, or 9.5%, to $605,680 thousand compared to $553,037 thousand in 2024[159] Customer Metrics - Active customers increased to 2,743,000 in Q2 2025, up from 2,577,000 in Q2 2024, indicating a growth in customer base[97] - Active customers increased during the period ended June 30, 2025, compared to the same period in 2024, driven by enhanced engagement and marketing efforts[114] Orders and Average Order Value - Total orders placed in Q2 2025 were 2,424,000, compared to 2,271,000 in Q2 2024, while total orders for the first half of 2025 were 4,732,000, up from 4,494,000 in the same period last year[97] - Average order value decreased slightly to $300 in Q2 2025 from $306 in Q2 2024, while the six-month average order value was $298 compared to $302 last year[97] - Average order value decreased in the three and six months ended June 30, 2025, primarily due to a shift in product mix[118] Sales Segments - REVOLVE segment accounted for 86.9% of net sales for Q2 2025, generating $268.4 million, a 9.3% increase from Q2 2024[134] - FWRD segment represented 13.1% of net sales for Q2 2025, with $40.6 million in sales, reflecting a 9.8% increase from Q2 2024[135] - Net sales in the United States contributed 78.2% of total net sales for Q2 2025, amounting to $241.6 million, a 7.4% increase from Q2 2024[136] - International sales accounted for 21.8% of net sales in Q2 2025, reaching $67.3 million, a 17.3% increase from Q2 2024[137] Cost and Expenses - The total tariff rate on goods imported from China reached 37.5%, impacting cost of sales and potentially customer demand[120] - The company expects cost of sales as a percentage of net sales to increase due to rising tariffs, particularly on products sourced from China[141] - Fulfillment expenses are anticipated to fluctuate as a percentage of net sales due to increased costs and expansion of the fulfillment network[142] - Marketing expenses are expected to rise in absolute dollars as the company scales, potentially increasing as a percentage of sales during certain periods[144] - General and administrative expenses are projected to increase in absolute terms to support business growth, with a long-term decline as a percentage of net sales[145] - Cost of sales for the three months ended June 30, 2025, rose by $12,059 thousand, or 9.3%, to $141,909 thousand, with a cost of sales percentage of net sales decreasing to 45.9% from 46.0%[151] - Selling and distribution expenses rose by $3,352 thousand, or 6.6%, to $53,794 thousand, accounting for 17.4% of net sales, a decrease from 17.9%[153] - Marketing expenses increased by $4,148 thousand, or 9.7%, to $47,109 thousand, maintaining a percentage of 15.3% of net sales[155] - General and administrative expenses increased by $4,832 thousand, or 14.4%, to $38,328 thousand, with the percentage of net sales rising to 12.4% from 11.9%[156] Strategic Initiatives - The company has successfully expanded internationally with limited investment, offering products on platforms like Tmall Global and Douyin in China[95] - The logistics infrastructure supports free shipping and returns in the U.S., optimized by proprietary algorithms to reduce costs and improve efficiency[94] - The focus on emerging and owned brands minimizes assortment overlap with other retailers, enhancing marketing efficiency and sales at full price[90] - The company utilizes a robust technology platform for data-driven merchandising, marketing, and inventory management, which aids in managing fashion risk[91] - Future growth is contingent on effectively managing customer retention and acquisition, as well as expanding product offerings and international markets[83] - The company is diversifying manufacturing sources outside of China and optimizing supply chain logistics to mitigate tariff impacts[121] - The overall economic environment, including tariffs and inflation, significantly affects consumer spending and company performance[119] - The company plans to increase marketing investments to enhance brand awareness and customer engagement, which may impact short-term operating income[125] Cash Flow and Capital Management - Cash and cash equivalents increased to $310.7 million as of June 30, 2025, up from $256.6 million at the end of 2024[169] - Operating cash flow for the six months ended June 30, 2025, was $57.8 million, significantly higher than $13.7 million for the same period in 2024[178] - Net cash used in investing activities was $7.0 million for the six months ended June 30, 2025, compared to $4.1 million in 2024[180] - The company authorized a stock repurchase program of up to $100 million for its Class A common stock in August 2023[175] - The line of credit provides up to $75.0 million in revolver borrowings, with no borrowings outstanding as of June 30, 2025[172] - Working capital increased to $387.4 million as of June 30, 2025, from $365.0 million at the end of 2024[169] - The company continues to monitor inflation impacts and may adjust pricing strategies to mitigate effects on demand[184]

Financial Performance - Net sales increased by 9% year-over-year, from $282.5 million in Q2 2024 to $309.0 million in Q2 2025[11] - Adjusted EBITDA increased by 12% year-over-year, from $20.5 million in Q2 2024 to $22.9 million in Q2 2025[11] - Adjusted EBITDA margin increased by 16 basis points year-over-year, reaching 7.4% in Q2 2025, the highest margin in 3 years[11] - Net income decreased by 35% year-over-year, from $15.4 million in Q2 2024 to $10.0 million in Q2 2025, primarily due to unfavorable other income/expense comparison and a higher effective tax rate[11] Segment and Geographic Performance - REVOLVE segment net sales increased by 9% year-over-year, from $245.5 million in Q2 2024 to $268.4 million in Q2 2025[16] - FWRD segment net sales increased by 10% year-over-year, from $36.9 million in Q2 2024 to $40.6 million in Q2 2025[16] - U S net sales increased by 7% year-over-year, from $225.1 million in Q2 2024 to $241.6 million in Q2 2025[16] - International net sales increased by 17% year-over-year, from $57.4 million in Q2 2024 to $67.3 million in Q2 2025[16] Operating Metrics - Active customers increased by 7% year-over-year[21] - Total orders placed increased by 6% year-over-year[21] - Average order value decreased by 2% year-over-year, from $306 in Q2 2024 to $300 in Q2 2025[21] Balance Sheet and Cash Flow - Free cash flow for the first half of 2025 was $52.4 million[31] - Cash and cash equivalents increased by $66 million or 27% year-over-year to $310.7 million[36] - The company repurchased 92,583 shares of Class A common stock during Q2 2025 at an average cost of $18.78 per share[36]

[Executive Summary & Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Highlights) [Co-Founder and Co-CEO Commentary](index=1&type=section&id=Co-Founder%20and%20Co-CEO%20Commentary) Revolve Group's Co-CEOs highlight strong Q2 2025 performance with year-over-year growth in net sales and operating income, record adjusted EBITDA margin, and robust operating cash flow, while investing in long-term growth initiatives - The company achieved **9% year-over-year growth in net sales** and **10% in operating income** for Q2 2025, with adjusted EBITDA margin reaching a three-year high and operating cash flow a four-year high for the period[2](index=2&type=chunk) - The company sustained profitable growth and market share gains while investing in long-term drivers such as AI enhancements, new private label development, retail exploration, and category expansion[2](index=2&type=chunk) [Second Quarter 2025 Financial Summary](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Summary) Revolve Group reported Q2 2025 net sales of **$309 million** (up 9%), gross profit of **$167.1 million** (up 9%), and adjusted EBITDA of **$22.9 million** (up 12%), despite a 35% net income decrease to **$10 million**, with operating cash flow significantly improving to **$12.6 million** Key Financial Summary | Metric | Q2 2025 (USD Thousands) | Q2 2024 (USD Thousands) | YoY Change | | :--- | :--- | :--- | :--- | | Net Sales | $308,971 | $282,456 | 9% | | Gross Profit | $167,062 | $152,606 | 9% | | Gross Margin | 54.1% | 54.0% | - | | Net Income | $10,011 | $15,377 | (35%) | | Adjusted EBITDA | $22,887 | $20,474 | 12% | | Net Cash Provided by Operating Activities | $12,620 | $(24,669) | NM | | Free Cash Flow | $9,607 | $(26,653) | NM | [Operational Metrics](index=1&type=section&id=Operational%20Metrics) As of June 30, 2025, Revolve Group's active customers (last 12 months) increased by 6% to **2.743 million**, total orders grew 7% to **2.424 million**, while average order value slightly decreased by 2% to **$300** Key Operational Metrics | Metric | Q2 2025 (Thousands) | Q2 2024 (Thousands) | YoY Change | | :--- | :--- | :--- | :--- | | Active Customers (Last 12 Months) | 2,743 | 2,577 | 6% | | Total Orders | 2,424 | 2,271 | 7% | | Average Order Value | $300 | $306 | (2%) | [Detailed Second Quarter 2025 Results](index=2&type=section&id=Detailed%20Second%20Quarter%202025%20Results) [Additional Second Quarter 2025 Metrics and Results Commentary](index=2&type=section&id=Additional%20Second%20Quarter%202025%20Metrics%20and%20Results%20Commentary) In Q2 2025, net sales and gross profit both increased by 9% year-over-year, with gross margin slightly up to 54.1% due to higher private label sales, while fulfillment and sales & distribution costs as a percentage of net sales decreased, indicating improved efficiency; however, net income and diluted EPS declined primarily due to other income shifting to other expenses (including foreign exchange losses and subsidiary disposal costs) and a higher effective tax rate, with both REVOLVE and FWRD segments showing net sales growth and international net sales growing faster than domestic - Gross margin was **54.1%**, an increase of 4 basis points year-over-year, primarily reflecting a higher mix of private label net sales, partially offset by a lower mix of full-price sales[7](index=7&type=chunk) - Net income was **$10 million**, down from **$15.4 million** in Q2 2024, mainly due to a significant year-over-year decrease in other income and a higher effective tax rate[7](index=7&type=chunk) Detailed Q2 2025 Performance Metrics | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net Sales | $309.0 Million | $282.5 Million | 9% | | Gross Profit | $167.1 Million | $152.6 Million | 9% | | Gross Margin | 54.1% | 54.0% | +0.1% | | Fulfillment Costs (% Net Sales) | 3.2% | 3.3% | -0.1% | | Sales & Distribution Costs (% Net Sales) | 17.4% | 17.9% | -0.5% | | Operating Income | $18.0 Million | $16.4 Million | 10% | | Other Expense (Income), Net | $2.9 Million (Expense) | $(4.3 Million) (Income) | -$7.2 Million (Shift to Expense) | | Effective Tax Rate | 33.7% | 25.7% | +8.0% | | Diluted EPS | $0.14 | $0.21 | (33%) | | REVOLVE Segment Net Sales | $268.4 Million | $245.5 Million | 9% | | FWRD Segment Net Sales | $40.6 Million | $36.9 Million | 10% | | Domestic Net Sales | $241.6 Million | $225.1 Million | 7% | | International Net Sales | $67.3 Million | $57.4 Million | 17% | [Cash Flow and Balance Sheet](index=2&type=section&id=Cash%20Flow%20and%20Balance%20Sheet) In Q2 2025, net cash provided by operating activities was **$12.6 million**, with a six-month cumulative total of **$57.8 million**, representing a significant 321% year-over-year increase; free cash flow also improved substantially to **$9.6 million** for the quarter and **$52.4 million** for six months, while cash and cash equivalents increased 27% year-over-year to **$310.7 million** as of June 30, 2025, with the company remaining debt-free, and inventory decreased 6% to **$221 million** Cash Flow Summary | Metric | Q2 2025 (USD Thousands) | Q2 2024 (USD Thousands) | YoY Change (Q2) | Six Months 2025 (USD Thousands) | Six Months 2024 (USD Thousands) | YoY Change (6M) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $12,620 | $(24,669) | NM | $57,765 | $13,722 | 321% | | Free Cash Flow | $9,607 | $(26,653) | NM | $52,411 | $10,003 | 424% | - As of June 30, 2025, cash and cash equivalents totaled **$310.7 million**, a **27% increase** from **$244.7 million** as of June 30, 2024, with the company's balance sheet remaining debt-free[14](index=14&type=chunk) - As of June 30, 2025, inventory was **$221.0 million**, a **6% decrease** year-over-year[14](index=14&type=chunk) [Stock Repurchases](index=3&type=section&id=Stock%20Repurchases) Revolve Group repurchased **$1.7 million** worth of Class A common stock, totaling 92,583 shares at an average cost of **$18.78 per share**, during Q2 2025, with **$55.9 million** remaining available under its **$100 million** stock repurchase program as of June 30, 2025 - In Q2 2025, the company repurchased **$1.7 million** of Class A common stock, totaling 92,583 shares at an average cost of **$18.78 per share**[8](index=8&type=chunk) - As of June 30, 2025, **$55.9 million** remained available under the company's **$100 million** stock repurchase program[8](index=8&type=chunk) [Business Outlook & Recent Performance](index=3&type=section&id=Business%20Outlook%20%26%20Recent%20Performance) [Results Since the End of the Second Quarter of 2025](index=3&type=section&id=Results%20Since%20the%20End%20of%20the%20Second%20Quarter%20of%202025) Net sales for July 2025 increased by approximately 7% year-over-year, indicating continued business growth post-Q2 - Net sales for July 2025 increased by approximately **7%** year-over-year[9](index=9&type=chunk) [2025 Business Outlook](index=3&type=section&id=2025%20Business%20Outlook) Revolve Group provides updated full-year and Q3 2025 guidance, considering current macroeconomic conditions, cost pressures, and potential headwinds to consumer spending, including tariffs, inflation, supply chain disruptions, and foreign exchange fluctuations, with the updated full-year 2025 gross margin outlook raised to **52.1% to 52.6%** from the previous **50.0% to 52.0%** - The outlook considers current macroeconomic conditions, cost pressures, and potential headwinds to consumer spending, including tariffs, inflationary pressures, supply chain disruptions, and foreign exchange fluctuations[11](index=11&type=chunk) 2025 Business Outlook Metrics | Metric | Updated FY 2025 Outlook | Prior FY 2025 Outlook | Q3 2025 Outlook | | :--- | :--- | :--- | :--- | | Gross Margin | 52.1% to 52.6% | 50.0% to 52.0% | 51.2% to 51.7% | | Fulfillment Expenses | 3.1% to 3.2% of Net Sales | 3.0% to 3.2% of Net Sales | 3.2% of Net Sales | | Sales & Distribution Expenses | 17.2% to 17.5% of Net Sales | 17.2% to 17.5% of Net Sales | 17.5% of Net Sales | | Marketing Expenses | 14.8% to 15.0% of Net Sales | 14.9% to 15.1% of Net Sales | 14.5% of Net Sales | | General & Administrative Expenses | $152 Million to $154 Million | $154 Million to $157 Million | $38.5 Million | | Effective Tax Rate | 28% to 29% | 27% to 28% | - | [Corporate Information & Disclosures](index=3&type=section&id=Corporate%20Information%20%26%20Disclosures) [Conference Call Information](index=3&type=section&id=Conference%20Call%20Information) Revolve Group management will host a conference call on August 5, 2025, at 4:30 PM ET/1:30 PM PT to discuss these results, with details including dial-in numbers, conference ID, and audio webcast/replay information available on the investor relations website - Revolve Group management will host a conference call on **August 5, 2025, at 4:30 PM ET/1:30 PM PT** to discuss these results[13](index=13&type=chunk) - The conference call will be audio webcast live and available for replay on the investor relations website investors.revolve.com[13](index=13&type=chunk)[15](index=15&type=chunk) [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This press release contains forward-looking statements under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, concerning the company's growth prospects, market share expansion, business initiatives, and outlook for Q3 and full-year 2025, which are based on current expectations but involve risks and uncertainties that could cause actual results to differ materially, including economic conditions, tariffs, supply chain challenges, inflationary pressures, and geopolitical tensions, with no obligation for the company to update any forward-looking statements - All statements in this press release other than statements of historical or current fact are forward-looking statements, including but not limited to those regarding growth prospects, market share expansion, business initiatives, and the outlook for Q3 and full-year 2025[16](index=16&type=chunk) - Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from expectations, including economic conditions, the impact of tariffs, supply chain challenges, inflationary pressures, war and conflict, and other risks disclosed in SEC filings[16](index=16&type=chunk) [Use of Non-GAAP Financial Measures and Other Operating Metrics](index=4&type=section&id=Use%20of%20Non-GAAP%20Financial%20Measures%20and%20Other%20Operating%20Metrics) The company uses non-GAAP financial measures such as Adjusted EBITDA and Free Cash Flow in its press release and accompanying tables to supplement consolidated financial statements prepared in accordance with GAAP; management believes these non-GAAP measures provide meaningful supplemental information about the company's performance and liquidity by excluding certain expenses that may not be indicative of core operating performance, but they should not be considered a substitute for GAAP financial information, and the company provides reconciliations of these non-GAAP measures to the most directly comparable GAAP measures - The company refers to non-GAAP financial measures such as Adjusted EBITDA and Free Cash Flow in the press release[17](index=17&type=chunk) - The company uses these non-GAAP financial measures to evaluate operating performance, plan future operations, and make strategic decisions regarding capital allocation, providing meaningful supplemental information by excluding certain expenses that may not be indicative of core operating performance[19](index=19&type=chunk) - Reconciliations of non-GAAP financial measures to the most directly comparable GAAP measures are included at the end of this press release[20](index=20&type=chunk) [Definitions of Non-GAAP Financial Measures and Other Operating Metrics](index=5&type=section&id=Definitions%20of%20Non-GAAP%20Financial%20Measures%20and%20Other%20Operating%20Metrics) This section defines Revolve Group's non-GAAP financial and operating metrics, where Adjusted EBITDA is net income adjusted for other (income) expense, taxes, depreciation, amortization, stock-based compensation, specific transaction costs, and non-recurring items, and Free Cash Flow is net cash provided by operating activities less purchases of property and equipment and capitalized software, while operational metrics like active customers, total orders, and average order value are defined as key indicators of company growth, business velocity, and product appeal - Adjusted EBITDA is a non-GAAP financial measure calculated as net income adjusted for other (income) expense, taxes, depreciation and amortization, stock-based compensation expense, certain transaction costs, and non-recurring items[22](index=22&type=chunk) - Free Cash Flow is a non-GAAP financial measure calculated as net cash provided by operating activities less purchases of property and equipment and capitalized software[23](index=23&type=chunk) - Active customers are defined as unique customer accounts that have made at least one purchase in the past 12 months; total orders are the total number of orders placed by customers in a given period; and average order value is total website sales divided by total orders in a given period[24](index=24&type=chunk)[25](index=25&type=chunk)[26](index=26&type=chunk) [About Revolve Group, Inc.](index=5&type=section&id=About%20Revolve%20Group%2C%20Inc.) Revolve Group, Inc. (NYSE: RVLV) is a next-generation fashion retailer for Millennial and Gen Z consumers, offering a curated assortment of apparel, footwear, accessories, beauty, and home products through its two complementary segments, REVOLVE and FWRD, leveraging its dynamic platform to connect millions of consumers, thousands of global fashion influencers, and over 1,000 emerging, established, and owned brands - Revolve Group, Inc. is a next-generation fashion retailer for Millennial and Gen Z consumers[27](index=27&type=chunk) - The company sells merchandise through two complementary segments, REVOLVE and FWRD, with REVOLVE offering premium apparel, footwear, accessories, and beauty products from emerging, established, and owned brands, and FWRD offering a curated assortment of luxury brands[28](index=28&type=chunk)[29](index=29&type=chunk) [Contacts](index=6&type=section&id=Contacts) This section provides Revolve Group's investor relations and media contact information, including names, phone numbers, and email addresses - Investor Contact: Erik Randerson, CFA, Phone: 562.677.9513, Email: IR@revolve.com[30](index=30&type=chunk) - Media Contact: Jennifer Walker, Email: revolve@walkerdrawas.com[30](index=30&type=chunk) [Financial Statements](index=7&type=section&id=Financial%20Statements) [CONDENSED CONSOLIDATED STATEMENTS OF INCOME](index=7&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20INCOME) The condensed consolidated statements of income present Revolve Group's financial performance for the three and six months ended June 30, 2025, and 2024, showing Q2 2025 net sales of **$309 million** and gross profit of **$167.1 million**, but net income decreased to **$10 million** and diluted EPS to **$0.14**, primarily due to increased other expenses and a higher effective tax rate Condensed Consolidated Statements of Income | Metric (USD Thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Sales | $308,971 | $282,456 | $605,680 | $553,037 | | Cost of Goods Sold | $141,909 | $129,850 | $284,332 | $258,929 | | Gross Profit | $167,062 | $152,606 | $321,348 | $294,108 | | Total Operating Expenses | $149,059 | $136,171 | $288,657 | $268,345 | | Operating Income | $18,003 | $16,435 | $32,691 | $25,763 | | Other Expense (Income), Net | $2,913 | $(4,271) | $2,020 | $(9,592) | | Net Income | $10,011 | $15,377 | $21,417 | $26,250 | | Diluted Earnings Per Share | $0.14 | $0.21 | $0.30 | $0.37 | [CONDENSED CONSOLIDATED BALANCE SHEETS](index=8&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) As of June 30, 2025, Revolve Group's condensed consolidated balance sheets show total assets of **$722.9 million**, an increase from **$665.5 million** as of December 31, 2024, with cash and cash equivalents rising to **$310.7 million** and inventory slightly decreasing to **$221 million**, while total liabilities increased to **$254.3 million**, mainly due to higher accounts payable and return reserves, and total stockholders' equity grew to **$468.6 million** Condensed Consolidated Balance Sheets | Metric (USD Thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Assets | $722,922 | $665,547 | | Cash and Cash Equivalents | $310,716 | $256,600 | | Inventory | $221,011 | $229,244 | | Total Current Assets | $614,179 | $561,088 | | Total Liabilities | $254,335 | $227,762 | | Total Stockholders' Equity | $468,587 | $437,785 | [CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS](index=9&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) For the six months ended June 30, 2025, net cash provided by operating activities significantly increased to **$57.8 million** from **$13.7 million** in the prior year, driven by working capital changes, while net cash used in investing activities rose to **$7 million**, and net cash used in financing activities decreased to **$2.1 million**, resulting in a net increase in cash and cash equivalents of **$54.1 million** and an ending balance of **$310.7 million** Condensed Consolidated Statements of Cash Flows | Metric (USD Thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net Income | $21,417 | $26,250 | | Net Cash Provided by Operating Activities | $57,765 | $13,722 | | Net Cash Used in Investing Activities | $(7,011) | $(4,146) | | Net Cash Used in Financing Activities | $(2,098) | $(10,050) | | Net Increase in Cash and Cash Equivalents | $54,116 | $(712) | | Cash and Cash Equivalents at End of Period | $310,716 | $244,737 | [SEGMENT INFORMATION](index=10&type=section&id=SEGMENT%20INFORMATION) In Q2 2025, both REVOLVE and FWRD segments reported net sales growth, with REVOLVE segment net sales increasing 9% to **$268.4 million** and FWRD segment net sales growing 10% to **$40.6 million**, leading to corresponding gross profit increases; geographically, domestic net sales grew 7% to **$241.6 million**, while international net sales increased 17% to **$67.3 million** Segment Net Sales and Gross Profit | Segment (USD Thousands) | Q2 2025 Net Sales | Q2 2024 Net Sales | Q2 2025 Gross Profit | Q2 2024 Gross Profit | | :--- | :--- | :--- | :--- | :--- | | REVOLVE | $268,421 | $245,535 | $149,940 | $137,895 | | FWRD | $40,550 | $36,921 | $17,122 | $14,711 | | Total | $308,971 | $282,456 | $167,062 | $152,606 | Geographical Net Sales | Geographical Region (USD Thousands) | Q2 2025 Net Sales | Q2 2024 Net Sales | Six Months 2025 Net Sales | Six Months 2024 Net Sales | | :--- | :--- | :--- | :--- | :--- | | United States | $241,623 | $225,057 | $480,866 | $444,190 | | Rest of World | $67,348 | $57,399 | $124,814 | $108,847 | | Total | $308,971 | $282,456 | $605,680 | $553,037 | [KEY OPERATING AND FINANCIAL METRICS](index=11&type=section&id=KEY%20OPERATING%20AND%20FINANCIAL%20METRICS) This section summarizes Revolve Group's key operating and financial metrics for the three and six months ended June 30, 2025, and 2024, including gross margin, adjusted EBITDA, free cash flow, active customers, total orders, and average order value, demonstrating strong growth in adjusted EBITDA and free cash flow, alongside increases in active customers and total orders Key Operating and Financial Metrics | Metric (Thousands, except AOV and Percentages) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Gross Margin | 54.1% | 54.0% | 53.1% | 53.2% | | Adjusted EBITDA | $22,887 | $20,474 | $42,186 | $33,741 | | Free Cash Flow | $9,607 | $(26,653) | $52,411 | $10,003 | | Active Customers | 2,743 | 2,577 | 2,743 | 2,577 | | Total Orders | 2,424 | 2,271 | 4,732 | 4,494 | | Average Order Value | $300 | $306 | $298 | $302 | [RECONCILIATION OF NON-GAAP FINANCIAL MEASURES](index=12&type=section&id=RECONCILIATION%20OF%20NON-GAAP%20FINANCIAL%20MEASURES) This section provides detailed reconciliations of non-GAAP Adjusted EBITDA to net income and non-GAAP Free Cash Flow to net cash provided by operating activities for the three and six months ended June 30, 2025, and 2024, listing specific adjustments such as other expense, taxes, depreciation, stock-based compensation, transaction costs, and non-recurring items for Adjusted EBITDA, and purchases of property and equipment and capitalized software for Free Cash Flow Reconciliation of Adjusted EBITDA | Adjusted EBITDA Reconciliation (USD Thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Income | $10,011 | $15,377 | $21,417 | $26,250 | | Other Expense (Income), Net | $2,913 | $(4,271) | $2,020 | $(9,592) | | Provision for Income Taxes | $5,079 | $5,329 | $9,254 | $9,105 | | Depreciation and Amortization | $1,370 | $1,175 | $2,388 | $2,518 | | Stock-Based Compensation Expense | $2,304 | $2,094 | $5,057 | $4,653 | | Transaction Costs | $60 | $325 | $900 | $325 | | Non-Recurring Items | $1,150 | $445 | $1,150 | $482 | | Adjusted EBITDA | $22,887 | $20,474 | $42,186 | $33,741 | Reconciliation of Free Cash Flow | Free Cash Flow Reconciliation (USD Thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Cash Provided by (Used in) Operating Activities | $12,620 | $(24,669) | $57,765 | $13,722 | | Purchases of Property and Equipment | $(2,207) | $(1,047) | $(3,986) | $(2,782) | | Purchases of Capitalized Software | $(806) | $(937) | $(1,368) | $(937) | | Free Cash Flow | $9,607 | $(26,653) | $52,411 | $10,003 |

Core Viewpoint - Wall Street anticipates a year-over-year decline in earnings for Revolve Group despite higher revenues, with actual results being crucial for stock price movement [1][2]. Earnings Expectations - The earnings report is expected on August 5, with a consensus EPS estimate of $0.12, reflecting a -42.9% year-over-year change, while revenues are projected at $295.37 million, a 4.6% increase from the previous year [3][4]. Estimate Revisions - The consensus EPS estimate has been revised 20.59% higher in the last 30 days, indicating a positive reassessment by analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP for Revolve Group is +7.53%, suggesting a likelihood of beating the consensus EPS estimate, supported by a Zacks Rank of 2 [12]. Historical Performance - In the last reported quarter, Revolve Group exceeded the expected EPS of $0.13 by delivering $0.16, resulting in a +23.08% surprise. The company has beaten consensus EPS estimates in the last four quarters [13][14]. Industry Comparison - Columbia Sportswear, another player in the textile-apparel industry, is expected to report a loss of $0.28 per share, a -40% year-over-year change, with revenues projected at $589.48 million, a 3.4% increase [18].

Core Viewpoint - Revolve Group (RVLV) is seen as a strong investment opportunity due to significant revisions in earnings estimates, indicating a positive earnings outlook that may continue to drive stock price growth [1][10]. Earnings Estimates - Analysts are increasingly optimistic about Revolve Group's earnings prospects, leading to higher estimates that are expected to positively impact the stock price [2]. - For the current quarter, the earnings estimate is $0.12 per share, reflecting a decrease of 42.9% from the previous year, but the Zacks Consensus Estimate has increased by 20.59% over the last 30 days due to one upward revision [6]. - For the full year, the expected earnings are $0.41 per share, which is a year-over-year decline of 40.6%. However, the consensus estimate has risen by 6.32% recently, with two estimates moving higher and no negative revisions [7][8]. Zacks Rank - Revolve Group currently holds a Zacks Rank 2 (Buy), supported by favorable estimate revisions. This ranking is part of a system that has historically shown strong performance, with Zacks 1 stocks averaging a 25% annual return since 2008 [3][9]. - The Zacks Rank system indicates that stocks rated 1 (Strong Buy) and 2 (Buy) tend to outperform the S&P 500 significantly [9]. Stock Performance - The stock has gained 9.1% over the past four weeks, reflecting investor confidence driven by solid estimate revisions and positive earnings growth prospects [10].

Core Viewpoint - Revolve Group, Inc. is set to release its financial results for Q2 2025 on August 5, 2025, after market close, followed by a conference call to discuss the results [1] Company Overview - Revolve Group, Inc. operates as a next-generation fashion retailer targeting Millennial and Generation Z consumers, offering a curated selection of apparel, footwear, accessories, beauty, and home products [3] - The company was founded in 2003 by co-CEOs Michael Mente and Mike Karanikolas and operates through two segments: REVOLVE and FWRD, leveraging a single platform [4] Financial Call Details - The conference call will take place at 1:30 PM (PT) / 4:30 PM (ET) on August 5, 2025, with a toll-free number for domestic callers and a direct dial number for international callers provided [2] - A replay of the conference call will be available for a limited time starting approximately one hour after the call [2]