Revolve Group reports strong Q2 performance with 9 percent sales growth

Revolve Group, Inc. announced strong financial results for its second quarter ended June 30, 2025. After the quarter's end, the company's net sales in July 2025 increased by approximately 7 percent year-over-year.

The company's co-founder and co-CEO, Mike Karanikolas, highlighted a 9 percent year-over-year increase in net sales and a 10 percent growth in operating income, calling it a "strong start" to the quarter despite a "volatile environment and amidst all the macro uncertainty". The company also achieved its highest Adjusted EBITDA margin in three years and its highest operating cash flow for any second quarter in the past four years.

Revolve Group posts positive Q2

The company's net sales reached 309 million dollars, a 9 percent increase compared to the prior year. This growth was supported by a 6 percent rise in active customers over the trailing 12 months, totalling 2.74 million, and a 7 percent increase in total orders placed. The gross margin for the quarter was 54.1 percent, a slight increase from 54 percent in the previous year, which the company attributed to a higher mix of owned brand net sales that carry higher margins.

For the second quarter of 2025, the Revolve segment saw a 9 percent year-over-year increase in net sales, reaching 268.4 million dollars, while the FWRD segment's net sales also grew, increasing by 10 percent year-over-year to 40.6 million dollars. Domestically, net sales rose by 7 percent, totalling 241.6 million dollars and internationally, the company experienced even stronger growth, with net sales increasing by 17 percent to 67.3 million dollars.

Despite the positive sales figures, net income for the quarter decreased by 35 percent to 10 million dollars primarily due to a significant year-over-year decrease in other income and an increased effective tax rate. However, Adjusted EBITDA saw a 12 percent increase to 22.9 million dollars, reflecting strong net sales and gross profit combined with increased efficiency in fulfilment and distribution costs.

Co-founder and co-CEO Michael Mente emphasised the company's ability to achieve profitable growth while investing in long-term initiatives. He noted that the company's "healthy cash flow generation" provides the capacity to invest in areas such as "AI enhancements, developing new owned brands, physical retail exploration, and category expansion," which could accelerate growth for years to come.

Revolve Group updates outlook

Looking ahead, the company provided an updated outlook for the full fiscal year 2025, forecasting a gross margin of 52.1 percent to 52.6 percent and a decrease in general and administrative expenses. For the third quarter, Revolve expects net sales to grow by approximately 7 percent year-over-year.

The company, which was founded in 2003 by co-CEOs Michael Mente and Mike Karanikolas, operates two complementary segments: Revolve and FWRD, both leveraging a single platform. The Revolve segment offers a range of premium apparel, footwear, accessories, and beauty products from emerging, established, and owned brands, while the FWRD segment focuses on curated luxury brands.