Torrid (CURV) - 2026 Q1 - Quarterly Results

Torrid First Quarter 2025 Financial Results Performance Overview 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] - 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] - 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] - The company leverages a strong customer connection, with 95% of its customers engaged in its loyalty program[3] Financial Highlights for the First Quarter of Fiscal 2025 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 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] - Total liquidity, including available borrowing capacity, was $141.0 million[9] - 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] Fiscal 2025 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] - A net tariff impact of $20 million is expected, which will be fully offset by discretionary cost reductions and other optimizations[14] - 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] Consolidated Financial Statements 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 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 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 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 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 |