Q2 2024 Revolve Group Inc Earnings Call Transcript
Key Points
- Revolve Group Inc (RVLV) reported a 3% year-over-year increase in net sales, reaching $282 million.
- Net income for the second quarter was $15 million, or $0.21 per diluted share, marking a 111% year-over-year increase.
- Adjusted EBITDA increased by 97% year-over-year to $20 million, driven by a nearly 350 basis point expansion in adjusted EBITDA margin.
- International net sales grew by 13% year-over-year, with strong performance in regions like China and Mexico.
- The company achieved significant marketing efficiency, spending $7.5 million less in brand marketing while generating greater impact and increasing active customer growth.
- The FWRD segment saw a 4% decline in net sales year-over-year, despite some improvement from the first quarter.
- Inventory levels increased by 14% year-over-year, which could indicate potential overstocking issues.
- Free cash flow was negative $27 million for the second quarter, primarily due to unfavorable working capital movements.
- General and administrative costs increased, with expectations for higher G&A expenses in the second half of the year due to the Alexandre Vauthier acquisition and other investments.
- The company is cautious about factoring in the recent improvements in return rates into their financial outlook until they see more sustained traction.
Good afternoon. My name is Emma, and I will be your conference operator today. At this time, I would like to welcome everyone to Revolve's second-quarter 2024 results conference call. (Operator Instructions)
At this time, I'd like to turn the conference over to Erik Randerson, Vice President of Investor Relations at Revolve. Thank you. You may begin.
Good afternoon, everyone, and thanks for joining us to discuss Revolve's second-quarter 2024 results. Before we begin, I'd like to mention that we have posted a presentation containing Q2 financial highlights to our Investor Relations website located at investors.revolve.com. I would also like to remind you this conference call will include forward-looking statements, including statements related to our future growth, our inventory balance, our key priorities and operating initiatives, industry trends, our marketing events and impact, our partnerships and strategic acquisitions, our physical retail stores and our outlook for net sales,
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