FIGS, Inc.

Previous wording

At March 31, 2026, we had approximately 3.0 million active customers. Our customers come to us through word of mouth referrals, as well as through our data-driven brand and performance marketing efforts. See the section titled “Key Operating Metrics and Non-GAAP Financial Measures” for a definition of active customers.

Current wording

At June 30, 2026, we had approximately 3.1 million active customers. Our customers come to us through word of mouth referrals, as well as through our data-driven brand and performance marketing efforts. See the section titled “Key Operating Metrics and Non-GAAP Financial Measures” for a definition of active customers.

Previous wording

In the three months ended March 31, 2026, we had the following results compared to the comparable period in 2025:

Current wording

In the three and six months ended June 30, 2026, we had the following results compared to the comparable period in 2025:

Previous wording

◦Expanded our community of active customers by 12.2% from approximately 2.7 million at March 31, 2025 to approximately 3.0 million at March 31, 2026;

Current wording

◦Expanded our community of active customers by 13.2% from approximately 2.7 million at June 30, 2025 to approximately 3.1 million at June 30, 2026;

Previous wording

◦Adjusted EBITDA increased from $9.2 million to $13.9 million in the three months ended March 31, 2026, representing an adjusted EBITDA margin of 8.7%;

Current wording

◦Adjusted EBITDA increased from $19.7 million to $36.6 million in the three months ended June 30, 2026, and increased from $28.9 million to $50.5 million in the six months ended June 30, 2026, representing an adjusted EBITDA margin of 18.6% and 14.2%, respectively;

Previous wording

We continue to monitor changes in policy impacting global trade, including tariffs, which have been dynamic, unpredictable and subject to ongoing modification. In February 2026, the United States Supreme Court ruled that the use of the International Emergency Economic Powers Act (“IEEPA”) to impose tariffs was not permitted, invalidating a significant portion of U.S. tariffs that had been in effect since April 2025. The Administration responded by invoking a 10% global tariff pursuant to Section 122 of the Trade Act of 1974 for 150 days, effective on February 24, 2026 and scheduled to expire on July 24, 2026, unless extended by Congress. The Administration also expressed an intention to raise such tariff to 15%, although no formal action implementing that increase has been issued. The Administration also initiated trade investigations that could result in additional future tariffs prior to or following the expiration of the Section 122 tariffs. The ruling, and the Administration’s subsequent actions, have created substantial uncertainty regarding the tariff environment, including with respect to (i) whether and to what extent refunds will be issued for tariffs previously collected under IEEPA, (ii) the scope and duration of tariffs imposed under Section 122 and any new or higher tariffs that may be imposed under alternative mechanisms and (iii) the outcome of pending legal challenges to the Section 122 tariffs and the potential for further legal challenges to any such tariffs. We have applied for a refund of approximately $20 million of IEEPA tariffs paid by us, however the ultimate extent and timing of such refunds remains uncertain.

Current wording

We continue to monitor changes in policy impacting global trade, including tariffs, which have been dynamic, unpredictable and subject to ongoing modification. In February 2026, the United States Supreme Court ruled that the use of the International Emergency Economic Powers Act (“IEEPA”) to impose tariffs was not permitted, invalidating a significant portion of U.S. tariffs that had been in effect since April 2025. The Administration responded by invoking a 10.0% global tariff pursuant to Section 122 of the Trade Act of 1974 (the “Trade Act”), effective on February 24, 2026, which expired on July 24, 2026. On July 23, 2026, the Administration imposed new tariffs ranging from 10.0%-12.5% pursuant to Section 301 of the Trade Act, effective July 24, 2026. These tariffs are intended to replace the Section 122 tariffs and affect imports from approximately 60 countries and territories, including those where our suppliers are located. The ruling and the Administration’s subsequent actions have created substantial uncertainty regarding the tariff environment, including with respect to (i) the scope and duration of the new tariffs imposed under Section 301 and any new or higher tariffs that may be imposed and (ii) the outcome of pending legal challenges to the Section 122 tariffs and the potential for further legal challenges to those, the Section 301 tariffs and any future tariffs.

Previous wording

The tariffs in place from April 2025 through the February 2026 Supreme Court decision under IEEPA increased our product costs, negatively impacting gross margin for the three months ended March 31, 2026. We have implemented, and plan to continue to implement as needed, various mitigation strategies, which have included, and may in the future again include, adjusting the countries from which we source our products and renegotiating terms with suppliers, but we cannot be certain how effective they will be over the long term. Without taking into account mitigation efforts and based on the information available to us today, we believe that tariffs will continue to negatively impact gross margin for 2026, although to a lesser extent than we previously disclosed in our 2025 Annual Report on Form 10-K. This estimate and actual impact may change materially as conditions evolve and new information becomes available.

Current wording

Tariffs have increased our product costs, negatively impacting gross margin for the three months ended June 30, 2026. We have implemented, and plan to continue to implement as needed, various mitigation strategies, which have included, and may in the future again include, adjusting the countries from which we source our products and renegotiating terms with suppliers, but we cannot be certain how effective they will be over the long term. Without taking into account mitigation efforts and based on the information available to us today, we believe that tariffs will continue to negatively impact gross margin for 2026, although to a lesser extent than we previously disclosed in our 2025 Annual Report on Form 10-K. This estimate and actual impact may change materially as conditions evolve and new information becomes available.

Previous wording

Cost of goods sold consists principally of the cost of purchased merchandise and includes import duties, tariffs and other taxes, freight-in, defective merchandise returned by customers, inventory write-offs and other miscellaneous shrinkage. Our cost of goods sold has and may continue to fluctuate with the cost of the raw materials used in our products and freight costs and the impact of changes to applicable import duties and tariffs.

Current wording

Cost of goods sold consists principally of the cost of purchased merchandise and includes import duties, tariffs and other taxes, freight-in, defective merchandise returned by customers, inventory write-offs and other miscellaneous shrinkage. Our cost of goods sold has fluctuated and may continue to fluctuate with the cost of the raw materials used in our products and freight costs and the impact of changes to applicable import duties and tariffs.

Previous wording

(1)Includes stock-based compensation expense of $5.5 million and $7.2 million for the three months ended March 31, 2026 and 2025, respectively.

Current wording

(1)Includes stock-based compensation expense of $6.7 million and $7.6 million for the three months ended June 30, 2026 and 2025, respectively.

Previous wording

Net revenues increased by $35.0 million, or 28.0%, for the three months ended March 31, 2026, compared to the prior year period. The increase in net revenues was primarily driven by an increase in orders from new and existing customers, and an increase in AOV.

Current wording

Net revenues increased by $44.0 million, or 28.8%, for the three months ended June 30, 2026, compared to the prior year period. The increase in net revenues was primarily driven by an increase in orders and higher AOV.

Previous wording

Gross profit increased by $23.8 million, or 28.2%, for the three months ended March 31, 2026, compared to the prior year period. The increase in gross profit was primarily due to higher unit sales and positive impact from price increases, partially offset by tariffs.

Current wording

Gross profit increased by $45.6 million, or 44.6%, for the three months ended June 30, 2026, compared to the prior year period. The increase in gross profit was primarily due to IEEPA tariff refunds, higher unit sales, and positive impact from price increases, partially offset by tariffs.

Previous wording

Gross margin increased 0.1 percentage point for the three months ended March 31, 2026, compared to the prior year period. The increase in gross margin was primarily due to positive impact from price increases and ongoing efficiency efforts, largely offset by higher tariffs and product mix shift.

Current wording

Gross margin increased 8.2 percentage points for the three months ended June 30, 2026, compared to the prior year period. The increase in gross margin was primarily due to IEEPA tariff refunds, positive impacts from price increases and ongoing efficiency efforts, partially offset by tariffs.

Previous wording

General and administrative expense increased by $4.0 million, or 12.0%, for the three months ended March 31, 2026, compared to the prior year period and, as a percentage of net revenues, decreased by 3.4 percentage points. The decrease in general and administrative expense as a percentage of net revenues was primarily due to leverage on higher net revenues and lower stock-based compensation expense, partially offset by increased investment in people, and higher depreciation and amortization expense.

Current wording

General and administrative expense increased by $5.6 million, or 16.2%, for the three months ended June 30, 2026, compared to the prior year period and, as a percentage of net revenues, decreased by 2.3 percentage points. The decrease in general and administrative expense as a percentage of net revenues was primarily due to leverage on higher net revenues and lower stock-based compensation expense.

Previous wording

Other income, net decreased for the three months ended March 31, 2026, compared to the prior year period, primarily due to foreign exchange loss, partially offset by an increase in interest income.

Current wording

Other income, net decreased for the three months ended June 30, 2026, compared to the prior year period, primarily due to foreign exchange loss.

Previous wording

Cost of goods sold increased by $11.2 million, or 27.6%, for the three months ended March 31, 2026, compared to the prior year period. The increase in costs of goods sold was primarily due to higher unit sales and tariffs.

Current wording

Cost of goods sold increased by $9.5 million, or 10.5%, for the six months ended June 30, 2026, compared to the prior year period. The increase in cost of goods sold was primarily due to higher unit sales and tariffs, partially offset by IEEPA tariff refunds.

Previous wording

Operating expenses increased by $19.1 million, or 22.6%, for the three months ended March 31, 2026, compared to the prior year period, driven by higher marketing expense, general and administrative expense, and selling expense. As a percentage of net revenues, operating expenses decreased by 2.9 percentage points, primarily driven by leverage on higher net revenues in general and administrative expense and selling expense, partially offset by an increase in marketing expense.

Current wording

Operating expenses increased by $39.4 million, or 22.3%, for the six months ended June 30, 2026, compared to the prior year period, driven by higher marketing expense, selling expense, and general and administrative expense. As a percentage of net revenues, operating expenses decreased by 3.1 percentage points, primarily due to leverage on higher net revenues in general and administrative expense and selling expense, partially offset by an increase in marketing expense.

Previous wording

Selling expense increased by $3.8 million, or 11.5%, for the three months ended March 31, 2026, compared to the prior year period and, as a percentage of net revenues, decreased by 3.4 percentage points. The decrease in selling expense as a percentage of net revenues was primarily due to leverage on higher net revenues, favorable shipping rates, and lower fulfillment expense due to fulfillment center optimization.

Current wording

Selling expense increased by $13.0 million, or 19.4%, for the six months ended June 30, 2026, compared to the prior year period and, as a percentage of net revenues, decreased by 1.7 percentage points. The decrease in selling expense as a percentage of net revenues was primarily due to leverage on higher net revenues, favorable shipping rates and lower fulfillment expense due to fulfillment center optimization.

Previous wording

Marketing expense increased by $11.3 million, or 62.4%, for the three months ended March 31, 2026, compared to the prior year period and, as a percentage of net revenues, increased by 3.9 percentage points. The increase in marketing expense as a percentage of net revenues was primarily driven by our 2026 Winter Olympics campaign, partially offset by leverage on higher net revenues.

Current wording

Marketing expense increased by $16.7 million, or 40.4%, for the six months ended June 30, 2026, compared to the prior year period and, as a percentage of net revenues, increased by 1.4 percentage points. The increase in marketing expense as a percentage of net revenues was primarily due to our 2026 Winter Olympics campaign, partially offset by leverage on higher net revenues, and revenue efficiency on digital marketing spend.

Previous wording

We define AOV as the sum of the total net revenues in a given period divided by the total orders placed in that period. Total orders are the summation of all completed individual purchase transactions in a given period. We believe our relatively high AOV demonstrates the premium nature of our product. As we expand into and increase our presence in additional product categories, price points and international markets, AOV may fluctuate. AOV for the three months ended March 31, 2026 and 2025, respectively, are presented in the following table:

Current wording

We define AOV as the sum of the total net revenues in a given period divided by the total orders placed in that period. Total orders are the summation of all completed individual purchase transactions in a given period. We believe our relatively high AOV demonstrates the premium nature of our product. As we expand into and increase our presence in additional product categories, price points and international markets, AOV may fluctuate. AOV for the three and six months ended June 30, 2026 and 2025, respectively, are presented in the following table:

Previous wording

We calculate adjusted EBITDA as net income (loss) adjusted to exclude: other income, net; gain/loss on disposal of assets; provision for income taxes; depreciation and amortization expense; stock-based compensation and related expense; transaction costs; and expenses related to non-ordinary course disputes. Adjusted EBITDA margin is calculated by dividing adjusted EBITDA by net revenues.

Current wording

We calculate adjusted EBITDA as net income adjusted to exclude: other income, net; gain/loss on disposal of assets; provision for income taxes; depreciation and amortization expense; stock-based compensation and related expense; transaction costs; expenses related to non-ordinary course disputes; and refunds recognized for IEEPA tariffs incurred on goods sold in the prior fiscal year. Adjusted EBITDA margin is calculated by dividing adjusted EBITDA by net revenues.

Previous wording

The following table reflects a reconciliation of adjusted EBITDA to net income (loss), the most directly comparable financial measure prepared in accordance with GAAP and presents adjusted EBITDA margin with net income (loss) margin, the most directly comparable financial measure prepared in accordance with GAAP:

Current wording

The following table reflects a reconciliation of adjusted EBITDA to net income, the most directly comparable financial measure prepared in accordance with GAAP and presents adjusted EBITDA margin with net income margin, the most directly comparable financial measure prepared in accordance with GAAP:

Previous wording

(3)For the three months ended March 31, 2025, reflects $171,000 of stock-based compensation expense and payroll taxes inadvertently not reflected in our previously disclosed Adjusted EBITDA results for the same period.

Current wording

(4)For the six months ended June 30, 2025, reflects $171,000 of stock-based compensation expense and payroll taxes inadvertently not reflected in our previously disclosed Adjusted EBITDA results for the three months ended March 31, 2025.

Previous wording

(4)Net income (loss) margin represents net income (loss) as a percentage of net revenues.

Current wording

(5)Net income margin represents net income as a percentage of net revenues.

Previous wording

As of March 31, 2026 and December 31, 2025, we had $74.3 million and $82.0 million of cash and cash equivalents, respectively. Since inception, we have financed operations primarily through cash flows from operating activities and the sale of our capital stock.

Current wording

As of June 30, 2026 and December 31, 2025, we had $108.5 million and $82.0 million of cash and cash equivalents, respectively. Since inception, we have financed operations primarily through cash flows from operating activities and the sale of our capital stock.

Previous wording

In August 2024, our board of directors authorized a share repurchase program for up to $50.0 million of our outstanding Class A common stock, with no expiration date. On February 27, 2025, our board of directors authorized an increase of $50.0 million to the share repurchase program, bringing the total authorization for repurchases under the program to up to $100.0 million of our outstanding Class A common stock. During the three months ended March 31, 2026, we repurchased 571,592 shares of our Class A common stock for approximately $8.8 million. As of March 31, 2026, we had approximately $43.2 million available for future repurchases under the share repurchase program.

Current wording

In August 2024, our board of directors authorized a share repurchase program for up to $50.0 million of our outstanding Class A common stock, with no expiration date. On February 27, 2025, our board of directors authorized an increase of $50.0 million to the share repurchase program, bringing the total authorization for repurchases under the program as of that date to up to $100.0 million of our outstanding Class A common stock. During the three months ended June 30, 2026, we repurchased 2,009,381 shares of our Class A common stock for approximately $24.0 million. During the six months ended June 30, 2026, we repurchased 2,580,973 shares of our Class A common stock for approximately $32.8 million. As of June 30, 2026, we had approximately $19.2 million available for future repurchases under the share repurchase program.

Previous wording

Cash flows from operating activities decreased by $12.4 million for the three months ended March 31, 2026, compared to the same period last year. The decrease was due the timing of cash payments of accounts payable of $11.9 million and the timing of cash payments of accrued compensation and benefits of $11.7 million. The decrease was partially offset by an increase in our net income, including the impact of non-cash adjustments, of $5.9 million, lower inventory purchases of $4.4 million, the timing of cash payments for sales tax payable of $0.6 million, and decreased cash payments of operating lease liabilities of $0.5 million.

Current wording

Cash flows from operating activities increased by $46.8 million for the six months ended June 30, 2026, compared to the same period last year. The increase was due to the timing of cash payments for accrued expenses of $38.6 million, an increase in our net income including the impact of non-cash adjustments of $28.6 million, and lower inventory purchases of $28.2 million. The increase in our net income includes a benefit to cost of goods sold from IEEPA tariff refunds. The increase was partially offset by the timing of cash payments of accounts payable of $18.7 million, IEEPA tariff refund receivable of $16.0 million, the timing of cash payments of accrued compensation and benefits of $8.3 million, and the timing of cash payments of prepaid expenses and other current assets of $4.7 million.

Previous wording

Cash flows from investing activities consists of capital expenditures, as well as purchases, maturities, and sales of investments.

Current wording

Cash flows from investing activities consist of capital expenditures, as well as purchases, maturities, and sales of investments.

Previous wording

Cash flows from investing activities increased by $16.0 million for the three months ended March 31, 2026, compared to the same period last year. The increase in cash flows from investing activities was primarily due to higher maturities and sales of available-for-sale securities of $67.7 million. This was offset by higher purchases of available-for-sale securities of $50.8 million and higher purchases of property and equipment of $1.1 million.

Current wording

Cash flows from investing activities increased by $53.8 million for the six months ended June 30, 2026, compared to the same period last year. The increase in cash flows from investing activities was primarily due to higher maturities and sales of available-for-sale securities of $91.8 million. This was offset by higher purchases of available-for-sale securities of $34.1 million, and higher purchases of property and equipment of $2.6 million.

Previous wording

Cash flows from financing activities decreased by $15.6 million as compared to the same period last year. The decrease in financing cash flows was primarily due to payments for taxes related to the net share settlement of equity awards of $9.8 million, with no comparable activity in the prior year. In addition, cash flows from financing activities decreased due to an increase in repurchases of Class A common stock of $6.1 million.

Current wording

Cash flows from financing activities decreased by $39.2 million as compared to the same period last year. The decrease in financing cash flows was primarily due to an increase in repurchases of Class A common stock of $30.1 million. In addition, cash flows from financing activities decreased due to payments for taxes related to the net share settlement of equity awards of $9.8 million, with no comparable activity in the prior year.

Previous wording

Refer to Note 10 to our condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q for any commitments entered into during the three months ended March 31, 2026.

Current wording

Refer to Note 10 to our condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q for any commitments entered into during the three and six months ended June 30, 2026.