Revolve Group Inc., the fashion e-tailer catering to Millennials and Gen-Z, reported earnings jumped 21 percent in the first quarter ending March 31. Sales grew 16 percent, accelerating from 10 percent growth seen in the fourth quarter.

“Outstanding execution by our team within a dynamic operating environment led to strong first quarter results and continued market share gains, highlighted by our net sales increasing 16 percent year-over-year, earnings per share increasing 25 percent year-over-year, and $49 million in operating cash flow that significantly strengthened our pristine balance sheet,” said co-founder and co-CEO Mike Karanikolas.

“Beyond the outstanding quarterly results, I am most excited about our visible progress in longer-term initiatives, such as international expansion and advancing our use of AI technology, that have become key contributors to our momentum and reinforce my confidence that we will continue to drive profitable growth in the future,” added co-founder and co-CEO Michael Mente. “We have also made exciting advances in key growth initiatives that we believe could be game changers longer term, including the launch of our first-ever namesake label, Revolve Los Angeles, laying the foundation to expand our physical retail footprint to Miami, and an incredibly successful launch of Grow-Good beauty products created in partnership with Cardi B.” Recent Business Developments

  • Revolve successfully introduced Revolve Los Angeles, its first-ever namesake label. Revolve said, “We believe this exciting new chapter for our owned brand assortment creates a compelling foundation for continued profitable growth in the coming years.”
  • Revolve said it launched Grow-Good Beauty hair care products in partnership with Grammy award-winning performer and style icon, Cardi B, that sold out in less than an hour. Just a few weeks after the products launched, Grow-Good Beauty has already attracted more than 640,000 followers on Instagram.
  • Revolve entered into a lease for its third retail store in Miami. It is expected to open by the end of 2026.

Additional First Quarter 2026 Metrics and Results Commentary

  • Trailing 12-month active customers grew to 2,926,000 as of March 31, 2026, an increase of 8 percent year-over-year, Revolve’s highest year-over-year growth rate in more than two years.
  • Net sales were $342.9 million, a year-over-year increase of 16 percent, and a sequential improvement from the 10 percent increase year-over-year reported in the fourth quarter of 2025.
  • Gross profit was $180.6 million, a year-over-year increase of 17 percent.
  • Gross margin was 52.7 percent, a year-over-year increase of 68 basis points that was primarily driven by margin expansion in the FWRD segment.
  • Fulfillment costs were $10.8 million, or 3.1 percent of net sales, compared to $9.4 million, or 3.2 percent of net sales, in the first quarter of 2025.
  • Selling and distribution costs were $57.7 million, or 16.8 percent of net sales, compared to $50.0 million, or 16.8 percent of net sales, in the first quarter of 2025.
  • Marketing costs were $54.2 million, or 15.8 percent of net sales, compared to $42.4 million, or 14.3 percent of net sales, in the first quarter of 2025. The increased marketing investment year-over-year as a percentage of net sales primarily reflects incremental brand marketing investments to support various growth initiatives, including the launch of its first-ever namesake label, Revolve Los Angeles, within its owned brand assortment.
  • General and administrative costs were $42.3 million, or 12.3 percent of net sales, compared to $37.9 million, or 12.8 percent of net sales, in the first quarter of 2025. The increased efficiency year-over-year as a percentage of net sales primarily reflects scale efficiencies, with growth in net sales outpacing growth in general and administrative expenses.
  • Other income, net increased to $2.7 million from $0.9 million in the first quarter of 2025.
  • Net income was $13.8 million, a year-over-year increase of 21 percent.
  • Adjusted EBITDA was $21.1 million, a year-over-year increase of 9 percent.
  • Diluted earnings per share (EPS) was 20 cents, a year-over-year increase of 25 percent from 16 cents in the first quarter of 2025.

Additional Net Sales Commentary

  • Revolve segment net sales were $293.2 million, a year-over-year increase of 15 percent.
  • FWRD segment net sales were $49.6 million, a year-over-year increase of 17 percent.
  • Domestic net sales were $274.0 million, a year-over-year increase of 15 percent.
  • International net sales were $68.9 million, a year-over-year increase of 20 percent.

Cash Flow and Balance Sheet

  • Net cash provided by operating activities was $49.4 million and free cash flow was $44.9 million, an increase of 9 percent and 5 percent, respectively, compared to $45.1 million and $42.8 million reported in the first quarter of 2025.
  • Cash and cash equivalents: The cash flow generation has further strengthened its balance sheet and liquidity. Cash and cash equivalents as of March 31, 2026 were $335.8 million, an increase of $32.6 million, or 11 percent, from $303.2 million in total cash (including restricted cash) as of December 31, 2025, and an increase of $35.0 million, or 12 percent, from $300.8 million as of March 31, 2025. Revolve’s balance sheet as of March 31, 2026 remains debt free.
  • Inventory as of March 31, 2026 was $245.1 million, a decrease of $6.8 million, or 3 percent, from December 31, 2025, and an increase of $31.4 million, or 15 percent, year-over-year, from the inventory balance of $213.7 million as of March 31, 2025. The increase in inventory balance year-over-year is broadly consistent with its 16 percent year-over-year growth in net sales during the first quarter of 2026.

Results Since the End of the First Quarter of 2026

Net sales in April 2026 increased by approximately 14 percent year-over-year. Of note, the prior-year revenue comparison in April 2025 following Liberation Day was softer than normal due to peak tariff uncertainty, before rebounding into the low-double digit growth territory for the months of May and June 2025.

2026 Business Outlook

Revolve said its outlook takes into account its assessment of the current macroeconomic environment and related cost pressures and potential headwinds to consumer spending, including, but not limited to, geopolitical uncertainty, tariffs, inflationary pressures, supply chain disruptions and foreign currency volatility.

Charts and image courtesy Revolve