But logistics costs contributed to lower profits at the e-commerce company targeting Millennials and Gen Z.

The kids are all right — or at least they’re still spending.

Revolve Group Inc., which bills itself as “the next-generation fashion retailer for Millennial and Gen Z consumers” turned in a stronger-than-expected top line for the third quarter.

Sales rose 20 percent to $356 million for the quarter ended Sept. 30 — better than the 16.9 percent analysts counted on, according to Yahoo Finance. Sales at both divisions moved in lock step with the corporate average, with Revolve up to $306.8 million and Fwrd tallying $49.2 million.

The company’s active customer count rose 18 percent to 3.2 million for the trailing 12 months. Those shoppers delivered Revolve a 19 percent increase in orders, although the average order value slipped 5 percent to $292, a decline the company said was “primarily attributable to initial sales of Grow-Good beauty products at much lower price points.” Grow-Good, which launched in the spring, is part of a joint venture with Cardi B.

Michael Karanikolas, cofounder and co-chief executive officer, told analysts on a conference call: “Our strong top-line results and the momentum in our customer base in recent quarters is especially noteworthy in an environment where many in our industry have seen softer trends. We believe that it shows our investments are delivering results and reflects the team’s disciplined execution against our key growth initiatives.”

Karanikolas also pointed to continued improvement in the company’s return rate, which decreased by more than 2 percent from a year earlier.

Source link