Revolve sales up 10 percent as transformation plan kicks into next gear

Revolve Group announced on Tuesday sales rose 10 percent to $283.1 million for the third quarter, as the U.S. luxury retailer doubled down on its transformation efforts after a return to sales growth in the prior quarter.

The Los Angeles-based firm said Revolve segment  sales were $243.4 million, up 12%, while sales at its Fwrd segment were flat at $39.7 million. By region, domestic sales were $222.7 million, up 7%, outpaced by international
sales at $60.5 million, up 20%, driven by growth in all major regions.  

Meanwhile, the firm’s trailing 12-month active customers grew 5 percent to 2.628 million as of September 30. Net income grew by $3.2 million to $10.8 million during the quarter, while adjusted EBITDA was $17.5 million, a year-over-year increase of 85%.

“We delivered exceptional results in the third quarter, highlighted by double-digit top-line growth, significant expansion of net income, and 85% growth in Adjusted EBITDA year-over-year,” said co-founder and co-CEO Mike Karanikolas.

“Key contributors to our increased profitability were meaningfully improved efficiency in our logistics costs, continued improvement in our return rate, and increased marketing efficiency year-over-year.”    

“Our strong quarter is a result of our execution on key growth and efficiency initiatives, which have helped us continue our net sales momentum into the first month of the fourth quarter of 2024,” said co-founder and co-CEO Michael Mente.

“We achieved these strong financial results while continuing to invest in initiatives that we believe set us up well for market share gains over the long-term, including international expansion, leveraging AI technology for merchandising and marketing enhancements, expansion into physical retail, and broadening our owned brand capabilities.”    

The earning update comes just days after Revolve announced the upcoming opening of a seasonal pop-up shop at The Grove in Los Angeles, from November 14 to January 4, as the retailer looks to maximise revenue growth during the all-important holiday season