Revolve Group, Inc.

Previous wording

We sell merchandise through two complementary segments, REVOLVE and FWRD, that leverage one platform. Through REVOLVE, we offer an assortment of premium apparel, footwear, beauty and accessories from emerging, established and owned brands. Through FWRD, we offer an assortment of curated and elevated iconic and emerging luxury brands. REVOLVE has historically been focused on the discovery of trend-driven, ready-to-wear styles, while FWRD has been more heavily weighted toward the statement pieces in our customers’ wardrobe, such as shoes and handbags. We believe that FWRD provides our customer with a unique destination for luxury products as our customers’ spending power increases and their desire for fashion and inspiration remains central to their self-expression.

Current wording

We sell merchandise primarily through two complementary segments, REVOLVE and FWRD, that leverage one platform. Through REVOLVE, we offer an assortment of premium apparel, footwear, beauty and accessories from emerging, established and owned brands. Through FWRD, we offer an assortment of curated and elevated iconic and emerging luxury brands. REVOLVE has historically been focused on the discovery of trend-driven, ready-to-wear styles, while FWRD has been more heavily weighted toward the statement pieces in our customers’ wardrobe, such as shoes and handbags. We believe that FWRD provides our customer with a unique destination for luxury products as our customers’ spending power increases and their desire for fashion and inspiration remains central to their self-expression.

Previous wording

To date, we have successfully expanded internationally with limited investment and physical presence. Our ongoing initiative to elevate the international service levels and customer experience has been a key contributor to our growth. We also offer REVOLVE products on international marketplaces such as Tmall Global, RED and Douyin in China and Nykaa Fashion in India, to expand our distribution reach in these key geographies. We intend to continue to invest in and develop international markets while maintaining our focus on the core U.S. market.

Current wording

To date, we have successfully expanded internationally with limited investment and physical presence. Our ongoing initiative to elevate the international service levels and customer experience has been a key contributor to our growth. We also offer REVOLVE products on international marketplaces such as Tmall Global and RED in China and Nykaa Fashion in India, to expand our distribution reach in these key geographies. We intend to continue to invest in and develop international markets while maintaining our focus on the core U.S. market.

Previous wording

Gross margin is also impacted by inbound freight costs and the level of tariffs and duties placed on imported products. In the near-term, given the significant increase in tariff rates on imported products, particularly from China, our gross margin will be adversely impacted by the effects of tariffs, though any long-term impact remains unclear. See the section titled “—Factors Affecting Our Performance—Overall Economic Trends.”

Current wording

Gross margin is also impacted by inbound freight costs and the level of tariffs and duties placed on imported products.

Previous wording

A reconciliation of Adjusted EBITDA to net income for the three months ended March 31, 2026 and 2025 is as follows:

Current wording

A reconciliation of Adjusted EBITDA to net income for the three and six months ended June 30, 2026 and 2025 is as follows:

Previous wording

Total orders placed increased in the three months ended March 31, 2026 compared to the same period in 2025, primarily due to our increased engagement with our existing customers and acquisition of new customers through our sales and marketing efforts.

Current wording

Total orders placed increased in the three and six months ended June 30, 2026 compared to the same periods in 2025, primarily due to our increased engagement with our existing customers and acquisition of new customers through our sales and marketing efforts.

Previous wording

We define average order value as the sum of the total gross sales from our sites in a given period, prior to product returns, divided by the total orders placed in that period. We believe that average order value is a measure that is useful to investors and management in understanding our ongoing operations and in analysis of ongoing operating trends. Average order value varies depending on the site through which we sell merchandise, the percentage of sales at full price, and for sales at less than full price, the level of markdowns on these products, product mix, and the number of units per order. Average order value can be adversely impacted by negative consumer sentiment, including as a result of tariffs. A shift in product mix toward lower-priced products or categories may also reduce our average order value.

Current wording

We define average order value as the sum of the total gross sales from our sites in a given period, prior to product returns, divided by the total orders placed in that period. We believe that average order value is a measure that is useful to investors and management in understanding our ongoing operations and in analysis of ongoing operating trends. Average order value varies depending on the site through which we sell merchandise, the percentage of sales at full price, and for sales at less than full price, the level of markdowns on these products, product mix, and the number of units per order. Average order value can be adversely impacted by negative consumer sentiment, including as a result of tariffs. A shift in product mix toward lower-priced products or categories may also reduce our average order value. In the near-term, average order value may decrease year-over-year due to net sales of Grow-Good hair care products created in partnership with Cardi B following its successful launch in the second quarter of 2026. We expect this potential decrease to be at least partially offset by price increases as a result of the actual or anticipated effects of incremental tariffs that were in effect at various times and rates over the course of 2025 and early 2026, though any long-term impact remains unclear. The impact of tariffs may also impair comparability of average order value with prior periods. See the section titled “—Factors Affecting Our Performance—Overall Economic Trends.”

Previous wording

Average order value increased in the three months ended March 31, 2026, relative to the same period in 2025, primarily due to an increase in average selling price, partially offset by a decrease in units per order.

Current wording

Average order value in the three and six months ended June 30, 2026 was relatively flat compared to the same periods in 2025, as an increase in average selling price was offset by a decrease in units per order and a mix shift resulting from initial sales of Grow-Good hair care products, which have a much lower average order value.

Previous wording

For example, since February 2025, the U.S. government has imposed incremental tariffs on most goods imported from China, from which we source a significant portion of our products, subject to certain exceptions. At various points in 2025, the total tariff rate on our goods imported from China briefly reached 145.0%, before eventually decreasing to the current level of 10%. These tariffs are in addition to a pre-existing Section 301 tariff of 7.5% and baseline Harmonized Tariff Schedule, or HTS, tariffs, which vary by product. In addition, U.S. tariffs on goods imported from certain other countries from which we source products included an incremental reciprocal tariff of 10% imposed since April 2025 and higher reciprocal tariff rates at certain points in time for many U.S. trading partners including Japan, Turkey, Indonesia and India.

Current wording

For example, since February 2025, the U.S. government has imposed incremental tariffs on most goods imported from China and other U.S. trading partners including India, Turkey and Indonesia, from which we source a significant portion of our products, with certain exceptions. These include reciprocal and fentanyl-related tariffs of 10% or more imposed under the International Emergency Economic Powers Act, or IEEPA, and a temporary import surcharge of 10% imposed under Section 122 of the Trade Act of 1974, which expired on July 24, 2026. At various points in 2025, the total tariff rate on our goods imported from China briefly reached 145.0%. These tariffs are in addition to a pre-existing Section 301 tariff of 7.5% and baseline Harmonized Tariff Schedule, or HTS, tariffs, which vary by product.

Previous wording

The REVOLVE segment contributes to a majority of our net sales, representing 85.5% and 85.7% of our net sales for the three months ended March 31, 2026 and 2025, respectively. During the three months ended March 31, 2026 and 2025, REVOLVE generated $293.2 million and $254.4 million in net sales, respectively, representing an increase of 15.3%. The net sales increase in the three months ended March 31, 2026, as compared to the same period in 2025, was primarily due to an increase in the number of orders shipped, a lower proportion of returned purchases and an increase in average order value.

Current wording

The REVOLVE segment contributes to a majority of our net sales, representing 87.1% and 86.9% of our net sales for the three months ended June 30, 2026 and 2025, respectively, and 86.3% of our net sales for both the six months ended June 30, 2026 and 2025. During the three months ended June 30, 2026 and 2025, REVOLVE generated $302.5 million and $268.4 million in net sales, respectively, representing an increase of 12.7%. During the six months ended June 30, 2026 and 2025, REVOLVE generated $595.8 million and $522.8 million in net sales, respectively, representing an increase of 14.0%. The net sales increase in the three and six months ended June 30, 2026, as compared to the same periods in 2025, was primarily due to an increase in the number of orders shipped and a lower proportion of returned purchases.

Previous wording

The FWRD segment contributes to a smaller portion of our overall net sales, representing 14.5% and 14.3% of our net sales for the three months ended March 31, 2026 and 2025, respectively. During the three months ended March 31, 2026 and 2025, FWRD generated $49.6 million and $42.3 million in net sales, respectively, representing an increase of 17.3%. The net sales increase in the three months ended March 31, 2026, as compared to the same period in 2025, was primarily due to an increase in the number of orders shipped, an increase in average order value and a lower proportion of returned purchases.

Current wording

The FWRD segment contributes to a smaller portion of our overall net sales, representing 12.9% and 13.1% of our net sales for the three months ended June 30, 2026 and 2025, respectively, and 13.7% of our net sales for both the six months ended June 30, 2026 and 2025. During the three months ended June 30, 2026 and 2025, FWRD generated $44.9 million and $40.6 million in net sales, respectively, representing an increase of 10.7%. During the six months ended June 30, 2026 and 2025, FWRD generated $94.5 million and $82.9 million in net sales, respectively, representing an increase of 14.1%. The net sales increase in the three months ended June 30, 2026, as compared to the same period in 2025, was primarily due to an increase in the number of orders shipped and a lower proportion of returned purchases, partially offset by a decrease in average order value. The net sales increase in the six months ended June 30, 2026, as compared to the same period in 2025, was primarily due to an increase in the number of orders shipped and a lower proportion of returned purchases.

Previous wording

Net sales to customers in the United States contributed to 79.9% and 80.6% of our net sales for the three months ended March 31, 2026 and 2025, respectively. During the three months ended March 31, 2026 and 2025, net sales to customers in the United States were $274.0 million and $239.2 million, respectively, representing an increase of 14.5%.

Current wording

Net sales to customers in the United States contributed to 77.4% and 78.2% of our net sales for the three months ended June 30, 2026 and 2025, respectively, and 78.7% and 79.4% of our net sales for the six months ended June 30, 2026 and 2025, respectively. During the three months ended June 30, 2026 and 2025, net sales to customers in the United States were $269.1 million and $241.6 million, respectively, representing an increase of 11.4%. During the six months ended June 30, 2026 and 2025, net sales to customers in the United States were $543.0 million and $480.9 million, respectively, representing an increase of 12.9%.

Previous wording

Net sales to customers outside of the United States contributed to 20.1% and 19.4% of our net sales for the three months ended March 31, 2026 and 2025, respectively. During the three months ended March 31, 2026 and 2025, net sales to customers outside of the United States were $68.9 million and $57.5 million, respectively, representing an increase of 19.9%.

Current wording

Net sales to customers outside of the United States contributed to 22.6% and 21.8% of our net sales for the three months ended June 30, 2026 and 2025, respectively, and 21.3% and 20.6% of our net sales for the six months ended June 30, 2026 and 2025, respectively. During the three months ended June 30, 2026 and 2025, net sales to customers outside of the United States were $78.4 million and $67.3 million, respectively, representing an increase of 16.3%. During the six months ended June 30, 2026 and 2025, net sales to customers outside of the United States were $147.2 million and $124.8 million, respectively, representing an increase of 18.0%.

Previous wording

Other income, net consists primarily of interest income on our money market funds, foreign currency exchange gains and losses, and fees associated with our line of credit.

Current wording

Other (income) expense, net consists primarily of interest income on our money market funds, foreign currency exchange gains and losses, and fees associated with our line of credit. For the three and six months ended June 30, 2025, other (income) expense, net also includes a $2.4 million loss on deconsolidation of subsidiary.

Previous wording

Net sales in the REVOLVE segment increased 15.3% to $293.2 million in the three months ended March 31, 2026 as compared to net sales of $254.4 million in the same period in 2025. Net sales in the FWRD segment increased 17.3% to $49.6 million in the three months ended March 31, 2026 as compared to net sales of $42.3 million in the same period in 2025.

Current wording

Net sales in the REVOLVE segment increased 12.7% to $302.5 million in the three months ended June 30, 2026 as compared to net sales of $268.4 million in the same period in 2025. Net sales in the FWRD segment increased 10.7% to $44.9 million in the three months ended June 30, 2026 as compared to net sales of $40.6 million in the same period in 2025.

Previous wording

The increase in cost of sales for the three months ended March 31, 2026, as compared to the same period in 2025, was primarily due to an increase in net sales. The decrease in cost of sales as a percentage of net sales was primarily due to shallower markdowns within markdown sales and a lower mix of third-party brand sales, partially offset by a lower percentage of full price sales.

Current wording

The increase in cost of sales for the three months ended June 30, 2026, as compared to the same period in 2025, was primarily due to an increase in net sales. The decrease in cost of sales as a percentage of net sales was primarily driven by a $5.6 million reduction of cost of sales due to IEEPA tariff refunds, shallower markdowns within markdown sales and a lower mix of third-party brand sales, partially offset by a lower percentage of full price sales and increased inventory valuation adjustments.

Previous wording

The increase in fulfillment expenses for the three months ended March 31, 2026, as compared to the same period in 2025, was primarily due to an increase in the number of units processed. The decrease in fulfillment expenses as a percentage of net sales was primarily due to a lower proportion of returned purchases.

Current wording

The increase in fulfillment expenses for the three months ended June 30, 2026, as compared to the same period in 2025, was primarily due to an increase in the number of units processed. The increase in fulfillment expenses as a percentage of net sales was primarily due to higher compensation expense for fulfillment staff, partially offset by a lower proportion of returned purchases.

Previous wording

The increase in selling and distribution expenses for the three months ended March 31, 2026, as compared to the same period in 2025, was due to increases in orders placed and net sales that resulted in a $5.3 million increase in shipping and handling costs, a $1.8 million increase in merchant processing fees and a $0.6 million increase in other selling expenses. Selling and distribution expenses as a percentage of net sales were flat as compared to the three months ended March 31, 2025, as higher shipping rates were offset by a lower proportion of returned purchases and an increase in average order value.

Current wording

The increase in selling and distribution expenses for the three months ended June 30, 2026, as compared to the same period in 2025, was due to increases in orders placed and net sales that resulted in a $6.4 million increase in shipping and handling costs, a $1.3 million increase in merchant processing fees and a $0.6 million increase in other selling expenses. The increase in selling and distribution expenses as a percentage of net sales as compared to the three months ended June 30, 2025, was primarily due to higher shipping rates, partially offset by a lower proportion of returned purchases.

Previous wording

The decrease in the effective tax rate for the three months ended March 31, 2026, as compared to the same period in 2025, was primarily due to the prior year increase in valuation allowance against deferred tax assets, which did not recur in the current period.

Current wording

The decrease in the effective tax rate for the three months ended June 30, 2026, as compared to the same period in 2025, was primarily due to the prior year increase in the valuation allowance against deferred tax assets and the disallowance of intercompany write-offs, which did not recur in the current period.

Previous wording

The increase in marketing expenses for the three months ended March 31, 2026, as compared to the same period in 2025, was due to a $6.3 million increase in performance marketing expense and a $5.5 million increase in brand marketing expense. The increase in marketing expenses as a percentage of net sales was primarily due to incremental marketing investments to support various growth initiatives, including the launch of our first-ever namesake label, REVOLVE Los Angeles, within our owned brand assortment.

Current wording

The increase in marketing expenses for the six months ended June 30, 2026, as compared to the same period in 2025, was due to a $14.5 million increase in performance marketing expense and a $7.7 million increase in brand marketing expense. The increase in marketing expenses as a percentage of net sales was primarily due to an increase in performance marketing investments and incremental marketing investments to support various growth initiatives, including the launch of our first-ever namesake label, REVOLVE Los Angeles, within our owned brand assortment and the launch of Grow-Good beauty assortment of hair care products with Cardi B.

Previous wording

The increase in general and administrative expenses for the three months ended March 31, 2026, as compared to the same period in 2025, was primarily due to a $2.0 million increase in salaries and related benefits and equity-based compensation expense, a $0.4 million increase related to professional services and other occupancy costs and a $2.0 million increase in other operating expenses to support business growth. The decrease in general and administrative expenses as a percentage of net sales was driven by scale efficiencies with growth in net sales outpacing growth in general and administrative expenses.

Current wording

The increase in general and administrative expenses for the six months ended June 30, 2026, as compared to the same period in 2025, was primarily due to a $4.0 million increase in salaries and related benefits and equity-based compensation expense, a $2.4 million increase in studio and design costs, a $2.0 million increase in other operating expenses to support business growth and a $1.0 million increase related to professional services and other occupancy costs. The decrease in general and administrative expenses as a percentage of net sales was driven by scale efficiencies with growth in net sales outpacing growth in general and administrative expenses.

Previous wording

For the three months ended March 31, 2026, we generated $49.4 million of operating cash flow as compared to $45.1 million for the same period in 2025. The increase in our operating cash flow was primarily due to higher net income adjusted for certain non-cash items and favorable impact from changes in working capital.

Current wording

For the six months ended June 30, 2026, we generated $41.2 million of operating cash flow as compared to $57.8 million for the same period in 2025. The decrease in our operating cash flow was primarily due to unfavorable impact from changes in working capital, partially offset by higher net income adjusted for certain non-cash items.

Previous wording

Our primary investing activities have consisted of purchases of property and equipment to support our fulfillment centers and our overall business growth and internally developed software for the continued development of our proprietary technology infrastructure, leasehold improvements in our retail locations, purchases of rental product and proceeds from sale of rental product. Purchases of property and equipment may vary from period-to-period depending on the timing and extent of the expansion of our operations.

Current wording

Our primary investing activities have consisted of purchases of property and equipment to support our fulfillment centers and our overall business growth and internally developed software for the continued development of our proprietary technology infrastructure, leasehold improvements in our retail locations, purchases of rental product and proceeds from the sale of rental product. Purchases of property and equipment may vary from period-to-period depending on the timing and extent of the expansion of our operations.

Previous wording

Net cash used in investing activities was $15.5 million and $2.3 million for the three months ended March 31, 2026 and 2025, respectively. The increase was primarily due to a $11.0 million investment in an equity method investee made during the three months ended March 31, 2026.

Current wording

Net cash used in investing activities was $21.8 million and $7.0 million for the six months ended June 30, 2026 and 2025, respectively. The increase was primarily due to a $14.5 million investment in unconsolidated entities made during the six months ended June 30, 2026.

Previous wording

Net cash used in financing activities was $0.5 million for both the three months ended March 31, 2026 and 2025, and was primarily attributable to tax withholdings on share-based payment awards, partially offset by proceeds from the exercise of stock options.

Current wording

Net cash used in financing activities was $10.2 million and $2.1 million for the six months ended June 30, 2026 and 2025, respectively, and was primarily attributable to repurchases of Class A common stock.