Company Reports

We will discontinue analyst coverage of Revolve Group on or about March 21, 2025. We provide analyst research and ratings on over 1,500 companies globally and periodically adjust our coverage according to investor interest and staffing.

The Revolve Group has carved out an interesting competitive niche in the affordable luxury category, leaning heavily into the strengths of the e-commerce channel—breadth of selection, scalability, and ubiquity of access—to reach a mobile-first, millennial and Generation Z audience. With the firm cycling through 110,000 styles on its Revolve and FWRD (luxury) marketplaces during 2024, and with roughly 1,900 new styles launching weekly, the firm has positioned itself as an "online source for discovery and inspiration," capturing more than $400 in after-return spending among its base of 2.7 million active buyers at year-end 2024. A measured foray into offline retail provides an interesting twist, offering the potential to reduce return rates, increase private-label penetration, and improve marketing efficiency, though that initiative remains nascent.

No-moat Revolve Group posted strong fourth-quarter earnings, with sales growth accelerating to 14% (from 10% a quarter earlier) as marketing investments and new categories build momentum. We're particularly impressed by the breadth of the turnaround, with double-digit sales growth across the Revolve and FWRD segments and in both US and international markets. That said, the quarter wasn't altogether positive, with 2025 guidance suggesting a lower gross margin range (52.2% to 52.7%) than our 53.2% estimate going into the quarter, while an uncertain tariff environment threatens further pressure as the year unfolds, given the firm's large but unquantified exposure to Chinese synthetic fabric manufacturing. We expect to raise our $30.50 per share fair value estimate by a low-single-digit percentage, and view the market's reaction—shares have shed 6%-7% of their value during Feb. 25 trading—as unduly harsh.

The Revolve Group has carved out an interesting competitive niche in the affordable luxury category, leaning heavily into the strengths of the e-commerce channel—breadth of selection, scalability, and ubiquity of access—to reach a mobile-first, millennial and Generation Z audience. With the firm cycling through 300,000 styles on its Revolve and FWRD (luxury) marketplaces during 2023, and with roughly 1,500 new styles launching weekly, the firm has positioned itself as an "online source for discovery and inspiration," capturing more than $400 in after-return spending among its base of 2.5 million active buyers at year-end 2023. A measured foray into offline retail provides an interesting twist, offering the potential to reduce return rates, increase private label penetration, and improve marketing efficiency, though that initiative remains nascent.

No-moat Revolve Group's unexpected return to double-digit sales growth during the third quarter of 2024 drove shares 15% to 16% higher in aftermarket trading, with investors viewing results as the first definitive sign that the upscale retailer has turned a corner after a challenging few years. We view that conclusion as appropriate and plan to raise our $27.50 fair value estimate by a high-single-digit percentage after mulling over results, leaving shares trading in a range we'd consider fairly valued.

The Revolve Group has carved out an interesting competitive niche in the affordable luxury category, leaning heavily into the strengths of the e-commerce channel—breadth of selection, scalability, and ubiquity of access—to reach a mobile-first, millennial and Gen Z audience. With the firm cycling through 300,000 styles on its Revolve and FWRD (luxury) marketplaces during 2023, and with roughly 1,500 new styles launching weekly, the firm has positioned itself as an "online source for discovery and inspiration," capturing more than $400 in after-return spending among its base of 2.5 million active buyers at year-end 2023. A measured foray into offline retail provides an interesting twist, offering the potential to reduce return rates, increase private label penetration, and improve marketing efficiency, though that initiative remains nascent.

No-moat Revolve posted strong second-quarter results, with $282 million in sales and $0.21 in diluted EPS topping our respective $280 million and $0.15 estimates. With the firm's sales trajectory improving markedly throughout the quarter, we expect to lift our full-year sales estimate by about 2% to $1.10 billion and our full-year adjusted EPS estimates by a high-teens rate, with unexpected marketing leverage making up the difference. Barring any changes to our long-term expectations for 11%-12% operating margin and low-double-digit annual revenue growth over the next decade, we expect to nudge our $27 fair value estimate up by just a low-single-digit percentage. Shares continue to look attractive at current prices despite a 9%-10% surge in after-market trading.

The Revolve Group has carved out an interesting competitive niche in the attainable luxury category, leaning heavily into the strengths of the e-commerce channel—breadth of selection, scalability, and ubiquity of access—to reach a mobile-first, millennial and Gen Z audience. With the firm cycling through 300,000 styles on its Revolve and FWRD (luxury) marketplaces during 2023, and with roughly 1,500 new styles launching weekly, the firm has positioned itself as an "online source for discovery and inspiration," capturing more than $400 in after-return spending among its base of 2.5 million active buyers at year-end 2023.

No-moat Revolve’s first-quarter results were aligned closely with our prerelease estimates. Moreover, a return to net sales growth in March and April bodes well for the company’s near-term prospects. Revolve continues to navigate a choppy macroeconomic environment, and we don’t expect it to return to double-digit sales growth until consumer discretionary spending improves, likely toward the end of 2025. However, its durable profitability, willingness to invest through the cycle, and enviable investment opportunities leave us ready buyers over a longer-term investment horizon. As we balance the mixed first-quarter results, time value, and reaffirmed guidance, we don’t expect to alter our $29 fair value estimate meaningfully.

The Revolve Group has carved out an interesting competitive niche in the attainable luxury category, leaning heavily into the strengths of the e-commerce channel—breadth of selection, scalability, and ubiquity of access—to reach a mobile-first, millennial and Gen Z audience. With the firm cycling through 300,000 styles on its Revolve and FWRD (luxury) marketplaces during 2023, and with roughly 1,500 new styles launching weekly, the firm has positioned itself as an "online source for discovery and inspiration," capturing more than $400 in after-return spending among its base of 2.5 million active buyers at year-end 2023.

No-moat Revolve showcased solid fiscal 2023 fourth-quarter marks, with $258 million in revenue and $0.05 in EPS outpacing our respective $242 million and $0.04 estimates before the earnings call. As we balance better-than-expected quarterly results, time value, and our tempered near-term forecasts (and given that we anticipate macro pressures will stretch further through 2024, with just 2% full-year sales growth and 3.1% operating margin), we don't expect any meaningful change to our $29 fair value estimate.

The Revolve Group has carved out an interesting competitive niche in the attainable luxury category, leaning heavily into the strengths of the e-commerce channel—breadth of selection, scalability, and ubiquity of access—to reach a mobile-first, millennial and Gen Z audience across its online properties. With the firm cycling through 219,000 styles on its Revolve and FWRD (luxury) marketplaces during 2022, and with roughly 1,000 new styles launching weekly, the firm has positioned itself as an "online source for discovery and inspiration," capturing more than $500 in after-return spend among its base of 2.3 million active buyers at year-end 2022.

No-moat Revolve delivered solid fiscal 2023 third-quarter results, with net sales of $257.6 million topping our $248.9 million forecast, while diluted EPS of $0.04 matched our estimate. Although we intend to trim our near-term forecast, consistent with tempered fourth-quarter guidance, we plan to lower our $29.50 fair value estimate by a low-single-digit percentage as we view long-term prospects as largely intact.

The Revolve Group has carved out an interesting competitive niche in the attainable luxury category, leaning heavily into the strengths of the e-commerce channel--breadth of selection, scalability, and ubiquity of access--to reach a mobile-first, millennial and Gen Z audience across its online properties. With the firm cycling through 219,000 styles on its REVOLVE and FRWD (luxury) marketplaces during 2022, and with roughly 1,000 new styles launching weekly, the firm has positioned itself as an "online source for discovery and inspiration," capturing more than $500 in after-return spend among its base of 2.3 million active buyers, by our estimates.

No-moat Revolve’s challenging second-quarter results and tempered guidance sent the shares down 11% in afterhours trading, but we think the market is overly fixated on the near-term macro challenges, leaving shares deeply undervalued. Underpinning the reaction, management trimmed its fiscal 2023 outlook to a 52%-52.5% gross margin (down from 52%-53%) while projecting slightly higher operating costs for the balance of the year. We plan to adjust our near-term estimates into the guided range, and consequently expect to trim our $31 fair value estimate by a low-single-digit percentage. We maintain our midteens top line growth over our explicit forecast (after fiscal 2023).

The Revolve Group has carved out an interesting competitive niche in the attainable luxury category, leaning heavily into the strengths of the e-commerce channel--breadth of selection, scalability, and ubiquity of access--to reach a mobile-first, millennial and Gen Z audience across its online properties. With the firm cycling through 219,000 styles on its REVOLVE and FRWD (luxury) marketplaces during 2022, and with roughly 1,000 new styles launching weekly, the firm has positioned itself as an "online source for discovery and inspiration," capturing more than $500 in after-return spend among its base of 2.3 million active buyers, by our estimates.

After digesting no-moat Revolve’s mixed fiscal 2023 first-quarter results, we plan to trim our $33.50 fair value estimate by a high-single-digit percentage, reflective of our less sanguine outlook for the year and into 2024. We now forecast a slight decline in net sales growth and 4.6% operating margin for the year, down from preprint estimates for 6.3% growth and a 5.7% margin. Despite a 3%-4% pullback on the print, shares offer a compelling buying opportunity at current trading prices (trading nearly 40% below our revised valuation), although a turnaround catalyst may not materialize until macro pressures subside.

The Revolve Group has carved out an interesting competitive niche in the attainable luxury category, leaning heavily into the strengths of the e-commerce channel--breadth of selection, scalability, and ubiquity of access--to reach a mobile-first, millennial and Gen Z audience across its online properties. With the firm cycling through 219,000 styles on its REVOLVE and FRWD (luxury) marketplaces during 2022, and with roughly 1,000 new styles launching weekly, the firm has positioned itself as an "online source for discovery and inspiration," capturing more than $500 in after-return spend among its base of 2.3 million active buyers, by our estimates.

After digesting no-moat Revolve’s fourth-quarter results and factoring in a tepid 2023 outlook, we plan to cut our $36 fair value estimate by a mid-single-digit percentage. This adjustment reflects a combination of lower gross margin guidance (to 52%-53%, down from 54% in 2022), elevated return rates, and lower projected full-price sales mix in 2023.

The Revolve Group has carved out an interesting competitive niche in the attainable luxury category, leaning heavily into the strengths of the e-commerce channel--breadth of selection, scalability, and ubiquity of access--to reach a mobile-first, millennial and Gen Z audience across its online properties. With approximately 50,000 stock-keeping units (SKUs) sitting on its REVOLVE and FRWD (luxury) marketplaces at any given time, and with 900 new styles launching weekly, the firm has positioned itself as an "online source for discovery and inspiration," capturing almost 40% of apparel wallet share among its base of more than 2 million active buyers, by our estimates.