RVLV earnings analysis
What we found in RVLV's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Revolve delivered a strong Q2, with revenue up 12.4% to $347.405 million, gross margin up 250 basis points to 56.6%, and diluted EPS of $0.26. Both segments grew at double-digit rates, aided by higher orders and lower returns, but the margin result included a $5.6 million tariff-refund benefit. The key offset is weaker quarterly cash conversion and deliberate operating-expense investment, while future margins remain exposed to potentially renewed or higher tariffs.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Double-digit sales growth continued
- Q2 net sales rose 12.4% year over year to $347.405 million, or $38.434 million of growth, driven by an 11.4% increase in orders shipped and a lower proportion of returned purchases. Revenue also increased 1.3% sequentially from $343 million in Q1 2026.
- Gross margin expanded sharply
- Gross margin expanded 250 basis points year over year to 56.6% from 54.1% and 390 basis points sequentially from 52.7%. The expansion included a $5.6 million reduction in cost of sales from IEEPA tariff refunds, plus shallower markdowns and a lower third-party-brand mix.
- Profitability and EPS improved
- Operating income increased to $22.100 million from $18.003 million, lifting operating margin to 6.4% from 5.8% year over year and from 4.6% in Q1 2026. Diluted EPS was $0.26, up from $0.14 a year earlier and $0.20 sequentially.
- Growth was broad-based across segments
- Both reporting segments grew: REVOLVE sales rose 12.7% to $302.5 million and FWRD sales increased 10.7% to $44.9 million. International sales grew 16.3% to $78.4 million, faster than U.S. sales growth of 11.4% to $269.1 million.
- Customer base and orders expanded
- Active customers increased to 3.041 million from 2.743 million, while total orders placed increased to 2.701 million from 2.424 million. Management attributed the increases to greater existing-customer engagement and sales-and-marketing-led new-customer acquisition.
- Cash-rich balance sheet and unused revolver
- Liquidity remained substantial: cash and cash equivalents rose $19.315 million from year-end to $311.571 million, working capital rose $4.395 million to $420.877 million, and there were no borrowings outstanding on the $75.0 million revolver.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Quarterly cash conversion turned negative
- Quarterly free cash flow was negative $10.933 million, versus positive $9.607 million a year earlier, as operating cash flow turned to an $8.213 million outflow from a $12.620 million inflow. Property-and-equipment purchases were $2.841 million, or 0.8% of quarterly sales, and rental-product spending was $0.806 million.
- Growth investments pressured cost leverage
- Marketing expense increased 22.0% to $57.491 million, outpacing 12.4% revenue growth, and rose to 16.5% of sales from 15.3%. Selling and distribution expense also rose 50 basis points to 17.9% of sales, reflecting higher shipping rates.
- Receivables and working capital absorbed cash
- Accounts receivable nearly doubled to $31.085 million from $16.561 million at year-end, a $14.524 million increase. Management cited unfavorable working-capital changes as the primary reason six-month operating cash flow declined to $41.207 million from $57.765 million.
- Tariff benefit may reverse amid policy uncertainty
- The filing newly details volatile tariff exposure: prior China tariff rates briefly reached 145.0% in 2025, while a June 2026 USTR proposal contemplated additional Section 301 tariffs of 10.0% to 12.5%. The current quarter's 56.6% gross margin benefited from $5.6 million of tariff refunds, which may not recur.
- Average-order-value pressure remains
- Management expects average order value could decline year over year following the Q2 Grow-Good hair-care launch because the products have a lower average order value. Average order value was already relatively flat year over year, as higher selling prices were offset by fewer units per order and mix effects.
- Investment and repurchases reduced cash flow
- Capital deployment increased: six-month investing cash outflow was $21.773 million versus $7.011 million, primarily including a $14.5 million investment in unconsolidated entities. Financing outflow was $10.236 million, including 497,675 shares repurchased during Q2 for approximately $9.9 million at average prices of $20.18 and $19.16.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $0.26
- Gross margin
- 56.6%
- Operating margin
- 6.4%
- Segment
- REVOLVE revenue: $302.5 million, up 12.7% year over year from $268.4 million.
- Segment
- FWRD revenue: $44.9 million, up 10.7% year over year from $40.6 million.
What they said about what is next.
The 10-Q provides no explicit quantitative revenue or EPS outlook. Management says it expects its current three fulfillment centers to support near-term growth plans and expects to open a third physical store in Miami in 2026; it also cautions that near-term Adjusted EBITDA may be adversely affected by tariff-driven gross-margin pressure.
The filing reads about the same as the one before it.
What came before.
- 10-Q · May 5, 2026
- Revolve Group reported Q1 2026 revenue of $342.9 million, surpassing estimates by 4.5%, with an EPS of $0.20 matching expectations. The revenue reflects a year-over-year increase of 15.6%, highlighting strong segment…
- 10-K · February 25, 2026
- REVOLVE reports $1.2 billion in net sales for 2025, serving 2.8 million active customers with a high-touch, influencer-driven premium fashion platform. The company highlights durable full-price selling (81.4% of net…
- 10-Q · November 5, 2024
- REVOLVE reported quarterly net sales of $283,146,000 for the three months ended September 30, 2024, up from $257,603,000 a year earlier, with gross margin of 51.2% and operating income of $14,253,000 (5.0% operating…
- 10-Q · August 6, 2024
- Revolve reported Q2 net sales of $282,456,000 (up $8,727,000 vs. Q2 2023) with gross profit of $152,606,000 (gross margin ~54.0%) and operating income of $16,435,000 (operating margin ~5.8%). Diluted EPS was $0.21 vs.…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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