Loading...
•
Sep 30, 2020
Revolve Q3 2020 Earnings Report
Achieved record results driven by strong execution on merchandising and operational initiatives.
Key Takeaways
Revolve Group reported strong Q3 2020 results with record net income of $19 million and record Adjusted EBITDA of $24 million, which increased 66% year-over-year. The company's highest-ever gross margin for a third quarter was a key driver of increased profitability.
Net sales decreased by 2% year-over-year, reflecting a 10-point improvement compared to Q2 2020.
REVOLVE segment net sales were $130.6 million, a decrease of 3.6% year-over-year.
FORWARD segment net sales were $20.5 million, an increase of 9.0% year-over-year.
International net sales increased 18% year-over-year, outperforming domestic net sales.
Revenue by Segment
Revenue by Geographic Location
Forward Guidance
COVID-19 has continued to have a negative impact on REVOLVE’s operations and financial results in recent weeks since the end of the third quarter. During the month of October 2020, net sales declined by a high single digit percentage year-over-year.
Positive Outlook
- Categories such as beauty, accessories, intimates, sweaters / knits and swimwear remained strong in the third quarter.
- Beauty was the standout with net sales increasing more than 100% YoY for the second consecutive quarter.
- Customer shopping and purchasing behavior continues to be influenced by the COVID-19 pandemic.
- Sales of apparel products frequently worn at home and styles for active lifestyles have remained strong.
- Rapid expansion of net sales into newer categories like beauty creates an exciting opportunity to acquire new customers.
Challenges Ahead
- The macro environment remains highly uncertain, as demonstrated by many U.S. states and international countries reporting higher levels of COVID-19 cases in recent weeks, and in many instances, imposing additional social distancing restrictions.
- We believe the absence of an expanded U.S. stimulus measure in recent months, combined with high unemployment rates, adds to the challenging climate for our customer demographic.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
Analyze how earnings announcements historically affect stock price performance
Avg. Return Before/After Earnings
Loading earnings performance data...
Loading earnings reaction data...