Overview

* Revolve Group Inc ( RVLV ) Q3 net sales grow 4% yr/yr, missing analyst expectations

* Adjusted EBITDA for Q3 beats analyst expectations, rising 45% yr/yr

* Net income for Q3 rises 97% yr/yr, reflecting strong profitability

Outlook

* Revolve expects FY 2025 gross margin of 53.5%, up from prior 52.1%-52.6%

* Company anticipates Q4 2025 gross margin between 53.1% and 53.6%

* Revolve sees FY 2025 marketing expenses at 14.6% of net sales

Result Drivers

* GROSS MARGIN IMPROVEMENT - Co attributes 347 basis point increase in gross margin to higher mix of full-price and owned brand sales

* DATA-DRIVEN STRATEGY - Co's data-driven merchandising strategy cited as a competitive advantage in improving margins

* LONG-TERM INVESTMENTS - Co continues to invest in international expansion, new brands, AI, and retail opportunities, supported by strong cash flow

Key Details

Metric Beat/Mis Actual Consensu

s s

Estimate

Q3 Sales Miss $295.63 $297.60

mln mln (14

Analysts

)

Q3 EPS $0.29

Q3 Net $21.17

Income mln

Q3 Beat $25.34 $13.90

Adjusted mln mln (14

EBITDA Analysts

)

Q3 Gross 54.60%

Margin

Q3 Gross $161.51

Profit mln

Analyst Coverage

* The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 9 "strong buy" or "buy", 5 "hold" and 1 "sell" or "strong sell"

* The average consensus recommendation for the department stores peer group is "buy"

* Wall Street's median 12-month price target for Revolve Group Inc ( RVLV ) is $25.00, about 14.8% above its November 3 closing price of $21.30

* The stock recently traded at 32 times the next 12-month earnings vs. a P/E of 40 three months ago

Press Release:

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)