{"id":19045,"date":"2025-12-12T11:02:02","date_gmt":"2025-12-12T18:02:02","guid":{"rendered":"https:\/\/footwearmagazine.com\/?p=19045"},"modified":"2025-12-12T11:02:02","modified_gmt":"2025-12-12T18:02:02","slug":"revolve-q3-2025-results","status":"publish","type":"post","link":"https:\/\/footwearmagazine.com\/?p=19045","title":{"rendered":"Revolve Group Delivers Record Profitability and Margin Gains in Q3 2025"},"content":{"rendered":"\r\n<p class=\"wp-block-paragraph\">Performance excellence and bold investment define a milestone quarter for the next-gen fashion powerhouse.\u200b<\/p>\r\n\r\n\r\n\r\n<h3 id=\"h-standout-financial-results-and-strategic-execution\" class=\"wp-block-heading\"><strong>Standout Financial Results and Strategic Execution<\/strong><\/h3>\r\n\r\n\r\n\r\n<p class=\"wp-block-paragraph\"><a href=\"https:\/\/www.revolve.com\/\">Revolve Group<\/a>, the e-commerce leader for Millennial and Gen Z fashion, posted strong third-quarter results for 2025. Net sales climbed 4% to $295.6 million, with domestic sales up 4% and international sales up 6% year-over-year.<\/p>\r\n\r\n\r\n\r\n<p class=\"wp-block-paragraph\">Gross profit surged 11% to $161.5 million, driven by a leap in gross margin to 54.6% a 347 basis point increase thanks to shallower markdowns, a greater mix of full-price and owned brand sales, and higher realized margins per item.\u200b\u00a0The company\u2019s trailing 12-month active customer count reached 2.75 million, up 5%, with total orders placed also increasing 5% all while average order value ticked up to $306.\u200b\u00a0Net income soared 97% to $21.2 million, and diluted EPS nearly doubled to $0.29. Adjusted EBITDA rocketed 45% to a third-quarter record of $25.3 million, highlighting robust margin expansion and operating discipline.\u200b<\/p>\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n<h3 id=\"h-strengthening-cash-flow-and-balance-sheet-amid-investment\" class=\"wp-block-heading\"><strong>Strengthening Cash Flow and Balance Sheet Amid Investment<\/strong><\/h3>\r\n\r\n\r\n\r\n<p class=\"wp-block-paragraph\">Revolve\u2019s focus on sustainable growth is reinforced by free cash flow of $6.6 million for Q3, up 7% year-over-year, and a cash balance of $315.4 million a 25% boost compared to last year\u2019s quarter-end.\u00a0The company remains debt free and invested $0.3 million in stock repurchases. Inventory levels declined by 1% year-over-year to $238.8 million, reflecting effective inventory management.\u200b<\/p>\r\n\r\n\r\n\r\n\r\n\r\n<p class=\"wp-block-paragraph\">Operating activities generated $11.8 million in net cash for the quarter, while free cash flow over nine months leapt 265%, primarily due to stronger income and favorable working capital shifts compared to the previous year.\u200b<\/p>\r\n\r\n\r\n\r\n<h3 id=\"h-segment-insights-and-outlook\" class=\"wp-block-heading\"><strong>Segment Insights and Outlook<\/strong><\/h3>\r\n\r\n\r\n\r\n<ul class=\"wp-block-list\">\r\n<li>REVOLVE segment net sales reached $254.6 million, up 5%.<\/li>\r\n\r\n\r\n\r\n<li>FWRD, the luxury-forward segment, delivered $41 million in net sales, up 3%.<\/li>\r\n<\/ul>\r\n\r\n\r\n\r\n<p class=\"wp-block-paragraph\">Revolve\u2019s strategic long-term investments international expansion, proprietary brand development, leveraging AI, and advancing physical retail remain in full swing, enabled by healthy cash flow and a resilient balance sheet.\u200b<\/p>\r\n\r\n\r\n\r\n<h3 id=\"h-management-commentary-and-forward-view\" class=\"wp-block-heading\"><strong>Management Commentary and Forward View<\/strong><\/h3>\r\n\r\n\r\n\r\n<p class=\"wp-block-paragraph\"><strong>Mike Karanikolas, co-founder and co-CEO<\/strong> stated, \u201cWe had a very solid third quarter, highlighted by exceptional gross margin performance that drove an 11% increase in gross profit year-over-year and a 45% increase in Adjusted EBITDA to $25 million, our highest ever for a third quarter\u2026 Our nearly 350 basis point increase in gross margin year-over-year\u2026 puts us on track to expand our gross margin and Adjusted EBITDA margin in the full year 2025 for the second straight year.\u201d\u200b<\/p>\r\n\r\n\r\n\r\n\r\n\r\n<h3 id=\"h-looking-ahead\" class=\"wp-block-heading\"><strong>Looking Ahead<\/strong><\/h3>\r\n\r\n\r\n\r\n<p class=\"wp-block-paragraph\">Management remains optimistic, guiding for continued gross margin and EBITDA margin expansion through the end of 2025, while acknowledging macroeconomic headwinds like tariffs, supply chain challenges, and inflation pressures. With a focus on innovation and operational agility, Revolve is positioned to build on its momentum as a digital fashion leader.<\/p>\r\n\r\n\r\n\r\n\r\n\r\n<p class=\"wp-block-paragraph\">Additional trend information regarding <a href=\"https:\/\/www.revolve.com\/\">Revolve Group<\/a>&#8216;s third quarter of 2025 financial results and operating metrics is available in the Q3 2025 Financial Highlights presentation available on the <a href=\"https:\/\/investors.revolve.com\/events-and-presentations\/default.aspx\">investor relations website<\/a>.<\/p>\r\n\r\n\r\n\r\n<p class=\"wp-block-paragraph\">&nbsp;<\/p>\r\n\r\n<div>\u00a0<\/div>","protected":false},"excerpt":{"rendered":"Performance excellence and bold investment define a milestone quarter for the next-gen fashion powerhouse.\u200b Standout Financial Results and&hellip;","protected":false},"author":219894229,"featured_media":20033,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_crdt_document":"","pad_hide_post_author":"","csco_display_header_overlay":false,"csco_singular_sidebar":"","csco_page_header_type":"","csco_page_load_nextpost":"","csco_post_video_location":[],"csco_post_video_location_hash":"","csco_post_video_url":"","csco_post_video_bg_start_time":0,"csco_post_video_bg_end_time":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[1408,1364,1450],"tags":[3290,2299,2298],"class_list":{"0":"post-19045","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"category-fashion","9":"category-retail","10":"tag-q3-2025","11":"tag-q3-2025-earnings","12":"tag-revolve-group","13":"cs-entry","14":"cs-video-wrap"},"yoast_head":"<!-- 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