Why Revolve Group Stock Was Sliding Today

Core Insights - Revolve Group's stock declined by 10.40% following the release of its quarterly results, which were in line with expectations but included a lowered gross margin guidance for the year [1] - The fashion industry is currently under pressure, and while Revolve's results were solid, the lowered guidance and slower growth in early Q2 contributed to the stock sell-off [1] Financial Performance - In Q1, Revolve's revenue increased by 10% to $296.7 million, slightly missing estimates of $297.8 million [3] - Gross margin decreased from 52.3% to 52%, while operating income surged by 57% to $14.7 million due to modest growth in marketing and selling costs [3] - Earnings per share rose from $0.15 to $0.16, beating consensus estimates by one cent [3] Future Outlook - Co-CEO Michael Mente expressed confidence in the company's ability to navigate current economic challenges and gain market share, despite uncertainties related to the global economy and trade war [4] - The company reported that net sales in April slowed to mid-single-digit growth, although international performance was stronger [4] - For the full year, Revolve revised its gross margin outlook down from 52.4%-52.9% to 50%-52%, influenced by current tariff levels [5] - If the trade war eases, Revolve could see potential upside, especially as its stock has fallen over 50% from its peak late last year [5]